Oromia Bank has signed an agreement with two technology providers to invest Omni Channel digital banking technology so as to deliver an integrated service.
On an event held on Thursday July 19, 2022 the bank has signed agreements with CR2 Digital Banking Technology and Moneta Technologies S.C.
“Previously, our bank has done a lot in equipping itself with the latest technology so as to provide reliable and modern banking services to our customers. By realizing the future era is based on banking technology, our Bank has put it into practice by installing the first and most massive data centre infrastructure in the private banking sector,” said Teferi Mekonnen, president of the bank, adding that the Technology adoption will make the bank a superior customer service experience centre and contribute significantly to the development of the country’s digital transformation and help to bring the unbanked society into the banking industry.
“Omni Channel Digital Banking Technology will also greatly update the bank’s internal processes and enables its customers to get services digitally,” said Fintan Byrne, CEO of CR2.
“Once built and readied for service, this huge investment Omni Channel digital banking technology will significantly update the entire payment system of the bank as Omni Channel digital banking technology enables payment of any bill from any bank through digital means,” indicated the bank’s president.
“Omni Channel’s Digital Banking Technology brings the payment options that were previously provided in a fragmented manner by multi-channel technology into one platform and making the service fast, modern and very convenient to users,” he further elaborated.
The adoption of this technology makes Oromia Bank the 3rd bank in the country to do so.
“What makes Oromia Bank unique with this technology is that, the rural farmers are our centre in terms of accessibility. In nutshell, our adoption of this technology will make our bank a superior customer service experience centre and will significantly contribute to the development of our country’s digital transformation,” said Teferi.
Oromia bank is said to be accessible through its 405 branches, by providing efficient and modern banking services. It is said that Oromia bank has financial technology security by installing an information system security centre that can monitor 24/7 and has the highest capacity in the industry.
Oromia bank forges partnerships to better digital banking services
Geray Real Estate sets emulative pace for construction turnkey
Geray Real Estate, a developer relatively new to the Ethiopian construction scene, has managed to pull through and transfer houses prior to the set turnkey deadline, which is rarely observed in the real estate market.
The developer which joined the sector about two years ago was successfully able to transfer houses to its buyers, about six months prior to the contract deadline.
The facility which was built up close to the Ethiopian Youth Sports Academy around Imperial Hotel will be officially inaugurated today.
At the event, houses that had already been sold to buyers will officially be transferred.
“We have fully accomplished the houses as per the agreement,” said Alemayehu Birhanie, founder and CEO of Geray Real Estate.
Alemayehu said that he was engaged in the export import business for the last about two decades, with a business culture that stems from his family.
“I have been engaged in the trade for the local and export market and the business is still up and running,” he added.
“I decided to join the real estate business about two years ago since there was a gap I observed,” he said, whilst adding, “if you are prudent enough, the sector is profitable and that is what drew me to become a developer.”
According to the real estate developer, the challenge on the sector is that developers are not committed to their contracts in terms of transfer of houses in a timely manner; to which he said it damaged their reputation and eroded the trust of potential customers.
“The project delay also contributes to a lot of money being incurred which may have a ripple effect and cause bankruptcy to developers,” he explained.
Meanwhile he admitted that there are several force majeure like sudden price hikes on raw materials and hard currency shortage to import some key input on projects like on finishing parts.
“Even though we faced several challenges we have committed to accomplish our projects as per the agreement we gave to our home buyers,” he said, adding, “and our commitment helped us to finalize the project in two years time ahead of the period.” The original agreement was to transfer houses in two and half years.
The facility is an 11 storey and has 27 luxury houses with different sized two bedroom properties.
“The ground and first floor has already been leased by businesses, while the residential flats started from second floor to ten and the last upper floor is an office for the real estate,” he explained.
The residential floors have three houses each in every flat, while the size range 154, 146, 141 in square meters of space. In total the facility rests on a 460 square meter plot of land. The facility has parking lots at the basement and open air area behind the building with a capacity to handle 50 cars.
“Initially we had sold the luxury house at 40,000 birr per square meter, but later the price spike in construction materials pushed the rate to climb up to 70, 000 birr for some houses that were not sold,” the developer said.
“As a beginner we sold houses at fair price, which is great for our customers,” he added.
Alemayehu said that their upcoming project is a 17 storey apartment that will be erected around Gerji Mebrat Hayel on a 610 square meter plot of land, “as per our principle we will continue constructing apartments at the heart of the city with relatively vast lands.”
The Gerji Mebrat Hayel project has already commenced construction will have three basements and 68 houses with two and three bedrooms.
He disclosed that the company will continue on its commitment to finalize houses as per the agreement. “We are working to finalize the upcoming project within two and half years time meanwhile the agreement is to transfer it in three years time.”
He said that besides sudden and nonstop price hike on the construction materials like cement and rebar, lack of plots in the capital is a major challenge for the sector, “one of the major reason that make the houses expensive is the way we access to land.”
“We are constructing house on the plots of land that we bought at extra ordinary rates from individual landowners, due to that the house will be sold at high rates,” he explained “if the city administration facilitate plots we may provide houses at lesser price points.”
Geray Real Estate is named after an irrigation dam called Geray that was constructed early 1980s in the Derg era.
Leather industry requests for ease of foreign currency retention rate
The Leather and Leather Products Industry and Research Development Centre propose for the government to ease the foreign currency retention rate in order to alleviate input shortage on the leather industry.
It can be recalled that the financial sector regulatory body introduced a new retention ration for hard currency earnings that only allow exporters to access only a fifth of their hard currency generated from export which resulted in erosion of the rate they secured in the past.
According to Mohammed Hussein, head of Leather and Leather Products Industry and Research Development Center that was formerly known as Leather Industry Development Institute, the manufacturing industry particularly the sector he leads is foreign currency dependant to import inputs.
“We understand the hard currency crunch the country faces, but the sector is challenging to operate since almost 99 percent of inputs like chemical, accessories and others are imported for factories,” he told Capital.
“So we proposed to the relevant government body, Ministry of Industry, for factories to access more foreign currencies they earned from their export earnings to import inputs,” he added.
“If it was a trade it could be understandable, but our industry entails manufacturers and even exporters so they need adequate foreign currency to import the proportion they need for their operations,” the Center head explained.
According to the proposal, the Center expressed that the leather industry aught at least access 40 percent of the foreign currency they earned for the purpose of import inputs.
The retention and utilization of export earnings and inward remittances directives no. FXD/79/2022 that was amended and became effective on January 6 on its article 4.1 stated that banks are required to surrender 70 percent of the foreign currency earnings from export of goods and services, private transfer and NGO’s transfer to the NBE.
Article 4.2 stated that exporter of goods and services and recipients of inward remittance shall have the right to retain 20 percent of their export earnings in foreign currency indeterminately in a retention account after the deduction of 70 percent surrender requirement from the total earnings. It added that the remaining 10 percent shall be surrendered to the respective bank.
Mohammed said that the Centre is working with the Ministry of Industry, which is the upper body for the Leather Industry Center, and others for factories who are in critical condition to get special solution to their problems and accelerate the production.
Besides foreign currency, regarding access to finance, factories particularly local industries have some sort of working capital problems to which the Center is approaching banks to solve their problems.
“Access to finance policy generally includes all sectors at the same range, while manufacturing industry needs a separate attention since it is totally different from other businesses,” he said, adding, “the recently ratified industry policy has considered access to finance for the sector to be treated separately unlike other businesses.”
In the budget year, the leather and leather goods export generated USD 40 million, which is almost the same compared with the preceding year.
In the past three years, the export earnings from the sector have declined in related with internal and external factors like COVID 19.
In the 2017/18 and 2018/19 budget year the sector contributed USD 130 million and USD 120 million respectively that reduced to USD 75 million in the 2019/20 budget year.
Meanwhile the export earnings eroded compared with the preceding year however the local market has been boosted in the budget year as per the explanation of Mohammed. He said that the import substation was very fruitful in the budget year that ended on July 7, “the local sales helps factories at least to operate smoothly and keep their employees.” The sector at least manages 30,000 jobs.
He reminded that the global market particularly the shoe business is significantly downgraded “the export of Huajian shoe export, which individually contributed up to USD 30 million, and other major exporters have eroded in the past few years. On the other hand factories that used to exported goat fur leather have now totally halted their export due to the market reduction.”
Alternative products that substitute the leather goods with lesser price have also affected the global leather industry.
UNRAVELLING BANKING
It seems the world of money has finally started to unravel in earnest. The current worldwide system of banking is based on ‘Fractional Reserve Banking’ (FRB). This fraudulent enterprise, which has been running the world roughshod for over half a millennium, is visibly floundering. The proliferation of phony money created out of thin air by FRB facilitated the ascendance of financialization, which in turn led to the prevailing dominant form of capitalism, namely, ‘crony capitalism.’ The gross inequality and polarization that is afflicting the world is one visible outcome of FRB! The other exogenous factor accelerating FRB’s demise is modern informatics!
Thanks to modern informatics, those who have had enough of this unjust system of money are meticulously developing new systems of exchange that will not rely on FRB! Even the most beneficial element of the current banking system, that of being an intermediary, will (most likely) be superseded by the new technology of ‘Cryptocurrencies and ‘Blockchain’! We will revisit these topics in the coming editorials. Today we will only examine the fraudulent foundations of FRB and the existing global banking edifice that rests on FRB. We will try to give the rationale for the complete dismantling of this unfair and dishonest system. Since the ‘empty suits’, aka, neighborhood bankers, are hardly aware of the subtle underlying principles of their industry, we believe they might also benefit from exposes of this sort. Being a dutiful and loyal functionary (a ‘useful idiots’, a la Lenin) will not be helpful going forward!
It all began when ancient goldsmiths started the ‘business of safekeeping’ for people with gold (mostly the wealthy) in their heavily fortified vaults, for a fee. The goldsmiths issued receipts to gold depositors ascertaining the exact quantity and date of deposition. The well-established goldsmiths (just like the big banks of today) became more reliable and started to attract a whole lot of gold deposition. Gradually the goldsmiths’ receipts became medium of exchanges and were used (in the market) for the selling and buying of goods/services. People assumed all receipts (equivalent to present day bank notes) in circulation were backed by gold in the various vaults. Soon the goldsmiths (present day bankers) became greedy and started to issue receipts without gold deposition and charging interests on these fraudulent receipts. The goldsmiths became rich without lifting a finger, save the effort of writing the phony receipts!
In those days crisis (both natural and man-made) were frequent occurrences. During these times people tended to rush to their respective goldsmiths, with their receipts on hand, to collect their gold. Obviously there were more receipts in circulation than actual gold in the vaults. In those days justice was swift and the crooked goldsmiths were dealt with promptly and appropriately. Today’s equivalent of such an incident is called a ‘bank run’ (when a particular bank faces massive request for withdrawal of deposits, which of course it doesn’t have.) Today when such a scenario obtains, instead of banks and bankers facing justice, they are promptly bailed out by their respective central banks, read taxpayers (by availing ‘unlimited’ amount of liquidity/money which they again create out of thin air, with adverse consequences to the sheeple’s livelihood. The interstate world system dictates that each and every nation should have a central bank, mostly to avoid bank runs. In those days, imprudent banks would have been wiped out if found engaged in fraudulent activities, but today they might not even get a slap on the wrists, so to speak. The moral of it all is, our world system condones the conning business of banking and has legalized and legitimized its blatant frauds! What are the consequences of fractional reserve banking?
Inequality is one major consequence! How is this inequality created? If a business/individual is positioned closer to the money spigot, then riches are made, not always from productive activities that crate wealth, but via phony instruments concocted to dispense unearned money via credits/loans under the pretexts of viable projects. A well-connected entity will submit a project (on paper) to financial institutions, which are always eager to extend loans (without creating debts banks cannot survive a day), irrespective of the real risks involved. If the borrower is lucky and the project prospers on the account of the loans extended to it, then there is no problem. On the other hand, if the project fails, then the problems are transferred to tax payers. The possibility of non-payment or non-performance according to agreed upon conditions doesn’t really bother the bank so much, as it can always print more money (out of thin air) to fulfill its obligations. If such tricks become too much and things gets very difficult to handle, there is always the state (again read tax payers) to bail them (banks) out. Subprime loans to house buyers or auto buyers were examples of known un-payable loans systemically transferred to tax payers. Such phenomenon take place all over the world and is not only restricted to the wealthy countries of the West. From Estonia to Ethiopia, from Ukraine to Uruguay the game remains the same.
Global institutions that back such ludicrous scheme include institutions like WB/IMF, WTO, etc. Fractional Reserve Banking is a cartel operation, a protected business. If a country employing FRB becomes very indebted because of excessive bank malfeasance, the IMF and other creditors will come in and will literally take over the country’s assets, via all sorts of disguise, (austerity, privatization, etc.) We are currently witnessing this in Greece. In this game of inequity, those working stiff on fixed salary as well as operating in the informal sector (low income) lose their purchasing power on a continuous basis. The inflation created by the bank’s non-stop ‘printing of money’ dilutes the hard earned money of labor. In this category we can also include small business operators/entrepreneurs who try to create wealth without resorting to the gimmick of phony money, characteristic of the connected! As these types of economic agents are not openly welcomed by the institutionalized cartel of banks, they have started to use other forms of medium of exchanges/currencies; like precious metals, coupons, crypto currencies, etc. FRB also damages nature by availing phony money for unnecessary, useless and unsustainable projects; don’t forget, in order for the banks to survive, they have to continuously create debt. Concrete jungles enveloped by smog detrimental to health pass for livable environments. Habitat destruction by way of construction!
