Current Status and Future of Agent Banking in Ethiopia

This key report, produced by Shega as part of the AKOFADA project, explores the growth, challenges, and opportunities of agent banking in Ethiopia. Introduced in 2012, agent banking has become a vital model for extending financial services to underserved populations, supported by the National Bank of Ethiopia and driven by mobile platforms like Telebirr and M-PESA. Despite rapid expansion, surpassing 500,000 registered agents by mid-2025, the sector faces issues of sustainability, profitability, and uneven coverage, with most agents concentrated in urban areas while rural regions remain underserved.

Drawing on a survey of 275 agents across nine regions, the report provides an in-depth analysis of operational realities, regulatory gaps, and infrastructural barriers. It highlights key challenges, including low transaction volumes, high operational costs, limited-service diversity, and weak provider support, all of which undermine agent profitability and long-term viability.

The report calls for targeted reforms to redistribute agents toward rural areas, improve liquidity and training support, expand service offerings, and enhance regulatory flexibility. It further emphasizes the importance of building customer trust and digital literacy to strengthen usage and sustainability.

Overall, the report positions agent banking as a cornerstone of Ethiopia’s financial inclusion agenda and underscores that coordinated action across policy, infrastructure, and innovation is essential for transforming agent networks into a more resilient, inclusive, and sustainable financial delivery system.