Ethiopian Financial Trio Launches Agar: An Integrated Digital Credit and Insurance Service
Kacha, Lucy Insurance, and Global Bank have launched Agar, a digital credit and insurance service in Ethiopia. The platform enables customers to access insurance without paperwork and offers digital loans for taxi drivers and salaried employees. With a focus on cybersecurity, Agar aims to improve financial access in a country with low insurance penetration.
A partnership has been formed between Kacha, Lucy Insurance, and Global Bank to launch Agar, an integrated digital credit and insurance service in Ethiopia. Announced at the Skylight Hotel, this collaboration allows customers to obtain insurance without traditional paperwork, enhancing accessibility in the financial services sector.
The newly introduced digital credit services cater specifically to taxi-hailing drivers and offer a digital salary advance function accessible through Kacha’s mobile app. This initiative reflects Lucy Insurance’s expansion into non-life and general insurance products, as explained by CEO Adeferes Wesene.
Agar offers a third-party motor insurance policy critical for the growing number of vehicles in Ethiopia, currently at over 1.4 million. Following a governmental directive last August that raised insurance premiums significantly, Agar’s premiums start at 5,000 birr and facilitate online policy management through a mobile app.
To activate the insurance coverage, users must provide specific documentation via the app, including vehicle details and ownership proof. Agar’s loan services are split into two segments: one for taxi drivers needing urgent funds and another for salaried employees seeking early wage access without collateral.
Agar also provides digital loans for premium payments, with terms ranging from one to nine months. Despite a low national insurance penetration rate of less than one percent, technological advancements are paving the way for tailored services. Recent collaborations, like that of Little Ethiopia and Lion Insurance, aim to broaden coverage options.
The system requires users to establish a transaction history with Global Bank, with a minimum one-time visit necessary to initiate services. Loan amounts can max out at 50,000 birr, adjusted by an automated credit scoring system. Delayed repayments can incur penalties up to 0.6% daily after 60 days, with loans categorized as nonperforming after 90 days.
Martha Hailemariam from the National Bank of Ethiopia emphasizes the critical need for robust cybersecurity measures to protect sensitive customer data within these emerging financial products, highlighting their commitment to consumer privacy and security.
The partnership among Kacha, Lucy Insurance, and Global Bank signifies a major step in enhancing digital financial services in Ethiopia. Through Agar, they aim to simplify access to insurance and financial assistance, particularly among taxi drivers and employees. This initiative meets the rising demand for such services in a market with a low insurance penetration rate. With oversight from regulatory bodies ensuring data security, Agar’s launch is poised to transform the financial landscape for Ethiopians.
Original Source: shega.co
