Dashen Bank has partnered with Accion and the Mastercard Center for Inclusive Growth to drive financial inclusion for Ethiopia’s micro, small, and medium enterprises (MSMEs). Through this collaboration, the bank is establishing an innovation hub that will develop digital financial services tailored to the needs of small businesses, with a particular focus on women-owned enterprises. This initiative aligns with Dashen Bank’s commitment to empowering MSMEs and enhancing their access to financial resources.
With nearly two million MSMEs playing a vital role in Ethiopia’s economy, the lack of access to credit remains a significant barrier to growth. Only 6 percent of microenterprises and 1.9 percent of small enterprises have formal credit access, contributing to a $4.2 billion financing gap in the sector. Women entrepreneurs face even greater challenges, with only 39 percent having a formal bank account compared to 55 percent of men. The partnership aims to bridge these gaps by leveraging technology-driven solutions to support small business owners in overcoming financial constraints.
Dashen Bank has been at the forefront of digital banking innovation in Ethiopia. The bank was one of the first to introduce a digital wallet, enabling seamless transactions for small business owners. Now, with support from Accion, it is taking another bold step by integrating AI-driven credit models and embedded finance solutions within existing supply chains. These efforts will help MSMEs transition from cash-based operations to digital financial systems, improving their visibility and access to financial services.
The innovation hub is a key part of Dashen Bank’s long-term strategy to expand financial services to MSMEs. Through extensive research and strategic partnerships, the bank will develop innovative credit solutions, digital banking tools, and non-financial support systems, such as business management resources. Additionally, an upcoming innovation workshop for Dashen Bank’s leadership and staff will explore the application of artificial intelligence and other emerging technologies in financial services.
Accion and Mastercard are playing a crucial role in this initiative, bringing global expertise in financial inclusion and digital transformation. Accion’s AI-driven approach to credit scoring will help MSMEs access credit based on alternative data points, making it easier for businesses with limited assets or financial history to secure funding. The Mastercard Center for Inclusive Growth, with its decade-long focus on financial empowerment, is reinforcing this effort by supporting the development of inclusive financial products designed to boost small business resilience.
Dashen Bank’s commitment to innovation and digital financial solutions is reshaping Ethiopia’s financial sector. By investing in technology and fostering strategic partnerships, the bank is positioning itself as a leader in driving inclusive economic growth. As this initiative progresses, it has the potential to transform the financial landscape for MSMEs, equipping them with the tools needed to thrive in a rapidly evolving digital economy.
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