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Dashen Bank signed an agreement with iVery, a South African electronic payment technology company, for the introduction of mobile commerce to Ethiopia last week on Tuesday, April 21, 2009.
According to the agreement, iVeri Payment Technologies has licensed its Gateway and MiCard e-payment processing solution to Dashen Bank.
This would make Dashen the first bank in Ethiopia to acquire ecommerce and mobile merchant transactions.
 

The bank has also chosen iVeri’s MiCard software, which will enable Dashen Bank account holders to interact with the bank via SMS for the first time.
Dashen Bank will deploy the iVeri payment Gateway software to all its merchants to process virtual and point of sale transactions. This project will be carried out with the assistance of SS Communications Plc, iVeri’s partner in Ethiopia.
Dashen chose iVeri’s technology for the next phase of fulfilling the need for a scalable solution to meet aggressive transaction growth objectives, to support multiple delivery channels and devices, and to offer standard card payment services to cardholders in Ethiopia, according to officials of the bank.

“We have a reputation for harnessing the advanced capabilities of IT to improve our services to customers and contribute to the bottom line,” Lulseged Teferi, president of the Bank told journalists after signing the agreement. “Our decision to invest in iVeri technology is another example of this.”
iVeri’s experience and tailor-made solutions can help banks redeliver new and enhanced customer service, while giving increased return on investment, said Barry Coetzee, chief executive officer of iVeri.
 
“The bank can address a wide range of processing needs for its e-payment operations, including mobile payments and e-commerce.”
Although officials of the bank disclosed that they allocate an about 20 million Br annual budget to enhance the performance of their bank through the application of IT solutions, neither its President nor other authorities were willing to state the costs they have incurred for the purchase of this particular software from iVery.
 
Dashen did not announce any public tender for the procurement of the technology, nor did it invite short listed companies to compete for the project within the two million dollars annual budget for IT works. Instead, after a field visit to study iVery’s work done for a Kenyan bank in October 2008, it directly started negotiations with the South African company, which was established in 1998.

“We are satisfied with the work of the company as seen during the visit,” Ebrahim Dawd, payment card manager with the bank, told Fortune. “We chose to negotiate with them to avoid the long process and time taken in competitive bidding.”  

The technology would go operational in about two months.
 
“We are more careful than fast,” iVery’s Coetzee said.

Established about 14 years ago, Dashen Bank has become a pioneer in international electronic payment systems using the VISA card in Ethiopia’s banking industry.
 
It also issues debt cards to its local clients, who can withdraw funds from their saving accounts through the automated teller machines (ATMs) it has installed in different part of Addis Abeba, whose number reached 42 currently.
Two years ago, the Bank had 1,400 visa card holders, but the number grew to over 50,000, of which over 4,000 are students from the University of Gonder.
 
Its international service with VISA has become an important source of foreign currency to the bank, bringing in four million dollars each month. Last year, it was able to collect 31 million dollars.
Although Dashen’s new technology is one step ahead in that it allows transfer of funds from one’s account to others, the younger United Bank was the first to introduce telephone and Internet banking systems - including text messages (SMS) - by the end of 2008.