1. Introduction to Gadaa Bank
(Hundeeffamarra kan Jiru)
በምስረታ ላይ ያለ
Introduction to Gadaa Bank
By :Hamdeno Mideso
New Generation Bank!

2. Gadaa Bank S.C (Underformation) – Introduction and Background
Gadaa Bank is an inclusive private commercial bank to be established for Ethiopia Economic Development and beyond . The bank is to be established by highly experienced bankers ,Business mentors ,Higher education lecturers ,Farmers representatives and investors ,
The Bank will focus upon the agro sector and Rural business
Gadaa Bank promotes rural economy (Agriculture + Non- agriculture) constitute
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3. Continued Intro and Background
The Finance Industry lubricates economic performance of a country by
Banking and finance play a vital and crucial role in framing Nation Development in today's business environment.
Gadaa bank project inception is mainly to support the Development displaced farmers to put their compensation money in a long term and viable investment while allowing financial services access whenever they require finance.
For most Banks in Ethiopia the bone of contention in terms of lending is“the golden few” while the resources are mobilized from the larger communities.
This means they are not adequately discharging their social responsibility ( like local business development services (BDS), so that farmers can improve their agricultural skills and their position in business value chains.
Gadaa Bank will work to reduce Economic disparities by serving the mass.
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4. Gadaa Bank Vision
 We envision to be a broad base and preferable financial institution that have bold foot print in the economic and social development of Ethiopia by
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5. Gadaa Bank Mission New Generation Bank!
Optimize shareholders value of their investment and stakeholders benefit while pursuing the modern and quality customer banking services;
 Ensure equitable access to financial services and business development advices to the customers .
Promote entrepreneurial spirit Development via Business Training and Business development consultation to make possible people to transform their resourcefulness into material well-being for betterment of their life via community capacity building program of the Bank
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6. Gadaa Bank Core Values
1. SME centricity –Promoting rural entrepreneurs 2, Honesty - 3, Innovation 4, Inclusiveness 5. Compassion 6,Team work 7. Persistent
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7. Gadaa Bank Strategic goal
To be the principal Private Commercial bank in Horn of Africa in terms of market share , customer base, profitability, and delivery of Quality Financial services to its customers .
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8. Gadaa Bank Strategic priorities
Build People first (the software ) before the building (the Hardware) : Resource for business growth and organizational effectiveness by due consideration of Human Capital /software
Banking connectivity: create and Connect Ethiopian Rural Entrepreneurs/farmers with Banking services
Internationalization: (via Network and presence)
Capabilities-
Strategic partners- Business cooperation with strategic partners
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9. Objectives of Gadaa Bank
a) To provide better and liberal credit facilities to entrepreneurs .
(ii) To save the rural poor from the money lenders and opportunistic dealers .
(iii) To act as a catalyst and accelerate the economic growth in the country .
(iv) To cultivate the banking habits among the rural people and mobilize savings for the economic development of rural areas.
(v) To increase employment opportunities by encouraging trade and commerce in rural and urban areas.
(vi) To encourage entrepreneurship in rural and urban areas.
(vii) To cater to the needs of the backward areas which are not covered by other banks
(viii) To reduce economic disparity
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10. Current Access to Rural Banking in Ethiopia
Rural population of about 85% with limited access to financial services .
A high proportion of rural lending is from informal sources.
Many of Rural people still do not have bank accounts.
Banks have woken up to the potential in the rural sector .
Current demand for credit in Rural Ethiopia is high .
Currently operating bank branches are concentrated in Finfine due to mainly private banks contribution/ strategy i.e. it accounts about 50% the total bank branches.
Private banks
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11. No of Branches in Regions No of Branches in Finfine
Banks
No of Branches in Regions
No of Branches in Finfine
Public
1154
328
Private
1926
1349
Total
3080
1677
Source: NBE Annual Report 2017/18
Banks
No of branches
In regions
In Finfine
Private
Public

12. What we are going to do?
Gadaa banks will grant loans and advances to SME and farmers.
Gadaa Bank will provides training and Business Development consultation,
In the short and medium term Gadaa bank focuse on lending SMEs which has huge cost of lending and high risk of collection. Due to this the return on investment will be lower than the the average industry return.
In the long run the SMEs will graduate to higher levels, they become dependable customer base, lower the risk of collection and enable the bank to earn the highest return on investment. .
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13. Continued
Loans to artisans to encourage them for the production of artistic and related goods.
Encourage the saving habit among the rural and semi-urban population .
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14. Rationals to Focus on Rural/Agricultural Banking
85% of Ethiopian population lives in Ethiopia
The agriculture sector plays a central role in the life and livelihood of most Ethiopians, where about 12 million smallholder farming households account for an estimated 95 percent of agricultural production and 85 percent of all employment" (FAO, 2014).
As more than 64% of smallholder farmers in Ethiopia are producing on less than one hectare of land, it is crucial to enhance their income by improving productivity through access to financial and agricultural services( and agri value chain Reason for Born of Gadaa bank )
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15. Gadaa Bank Development approach
We Use Gadaa system economic Model : bottom-up” community- generated solutions to intractable economic and social problems, rather than the application of “one size fits all”, “top-down” policies and initiatives
Promote People Centered-need Based Financial Solutions -community- generated solutions to intractable economic and social problems, common resources
Make markets work for the poor
Working with Development and professional associations
Our Underlying Development assumption :Supporting farmers and SMEs in Ethiopia is fundamental for promoting sustainable and fair economic development
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16. Differences Between Gadaa Bank and others
others Banks
Pro rich bank
Pro town
Pro capital
Established by few for profit of few ,
Focused on short term gain
Highly profit orientated
Gadaa Bank
Pro Poor Bank
Pro Rural Bank
Pro Entrepreneurship
To be Established by the mass up to shareholders /361 Woredas,=70 shareholders per woredas=
Focus on Medium term gain and long term good will
Social responsibility (consultation )+Profit

17. Will Adopt Oromo system of wealth creation: Basis of the Gadaa Bank
I. Human Capital based economy: Strong Community level resource management structure(Land,People ,Know how , Livestock, minerals, other assets etc)
II: Strong and sustainable social welfare institutions
Buusaa Gonofaa
Dabaree
Daboo- for creating business organizations (share company ,PLC and ….
And other socio-economic reinstitution schemes
III, Endowment (Handhuuraa (Entitlement to
Intergenerational Wealth Creation)
- (Agricultural Land and livestock )
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18. Advantage of buying Bank’s share
Prior purchase of shares(till 500, ETB ) enables you to be founding members.
Being founding members enables you to be entitled for certain %age of profit above non-founding members.
You will have voice for developing and implementing banking working regulation that protect the interest of Public
Bank share certificate will serve you as an assets and used for collateral to borrow money from Bank, which enable farmers to easily access banks for getting loans and advances .
Your capital will trade for you with out your perspiration/system will work for you
One share is one voice
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19. Gadaa Bank -Current Status
Subscribed capital =260 million
About 8 million ETB promised from Development Displaced communities of Bidiree and Haraqaloo
As the promotion strategies and the future direction ,the Bank had provided 2 days Entrepreneurship Training for about 510 DDC with collaboration of Oromia development Displaced office and UNDP-EDC

20. Ethiopian Bank services –Current status
For more than 110 Million people ,there are 18 Banks ,However
In Kenya for 45 Million People there are 40 Banks .
50% of Bank branches are concentrated in Finfinnee city
One Bank Branch is serving more twenty thousand customers
The National saving to GDP ratio is 24% (Report of NBE,2017/18, pp11) implying that there is huge gap to fill (world highest is 55%, and expand financial services outreach to the public at large.
To get banking services here, it takes long duration (However ,international standard is 3 minutes average waiting time)
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21. Banks Profit (2018) New Generation Bank! Rank Bank Gross Profit
Net Profit
in ETB 1
Awash Bank
1.96 billion
1.49 2
Dashen Bank
1.14 billion
929 million 3
Wegagen Bank
1.05 million 4
Oromia International Bank
938 million
728 million 5
Abyssinia Bank
766 million
563 million 6
United (Hibret) Bank
706.9 million
573.6 million 7
Nib International Bank
678 million
514 million 8
Cooperative Bank of Oromia
635 million 9
Lion (Anbessa) International Bank
500 million 10
Bunna Bank
427 million
311 million 11
Abay Bank
419 million
317 million 12
Berhan Bank
410 million 13
Zemen Bank
271 million 14
Enat Bank
216 million 15
Addis International Bank
147.6 million
113 million 16
Debub Global Bank
142 million
106 million
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22. What support we need for the Government
Recognition
Promotional support (Mass Media support at Discounted rate and Awareness Creation to the public at different stages )
Support us in updating National banking Police ,regulation and by laws that may hinders farmers entrepreneurship and rural banking/financing
By discuss with development displaced people as well as negotiating with them to voluntarily allocate certain % of their composition for buying shares of Gadaa bank
Enabling cities administration and Public enterprises to buy share of Gadaa bank
Support us by promoting our Vision and Mission to Role Model Farmers of Oromia regional state
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23. GALATOOMAA!
HORAA BULAA!
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