In order to move toward a cashless society Prime Minister Abiy Ahmed ordered public institutions to replace cash transactions with cashless ones.
The PM stated that it would be difficult to fully stop cash transactions in the whole society. “But we can start by ourselves and implement the cashless transaction from one public institute to another,” he said.
He talked about this at a National Doing Business Committee, made up of several public enterprises, which is being done to improve Ethiopia’s rating at the World Bank.
He also advised the National Bank of Ethiopia (NBE) and the Ministry of Finance to conduct a study that would lead to cashless payments. He stated that public institutions would settle their payments for private clients without cash.
The study would also indicate the payment of major transactions that should be done without cash. The private sector would be also included in the study. Currently cash transactions are the dominant payment system in the country, while the government has tried its best to improve the system.
It costs the government a lot of money to print cash and it costs forex because its done abroad. NBE via the support of international partners has implemented the improvement of a cashless society by introducing a core banking scheme and introducing a national payment system. At the same time public enterprises and other major private transactions are made via cash. Settling payment in millions of birr for a single purchase is common on the Ethiopian market. The PM said that public bodies shall undertake non cash payments for other public institutions without further study.