Ethiopia unveils Agar, an integrated digital credit and insurance service, launched by Kacha, Lucy Insurance, and Global Bank. The platform facilitates access to insurance without paperwork and offers loans for taxi drivers and salary advances. With low insurance penetration in the country, these innovations aim to boost financial inclusion and improve the customer experience.
In a notable collaboration, Kacha, Lucy Insurance, and Global Bank have launched Agar, an integrated digital credit and insurance service in Ethiopia. Announced at Skylight Hotel in Addis Ababa, Agar simplifies accessing insurance by removing the need for physical paperwork. The platform also features a digital credit service tailored for taxi-hailing drivers and a digital salary advance microloan available on Kacha’s mobile app.
Agar includes a third-party motor insurance policy for car owners, necessary due to Ethiopia’s growing vehicle population, which exceeds 1.4 million. With recent regulations increasing insurance premiums, Agar offers premiums starting from 5,000 birr, facilitating online management of insurance services. Users can activate policies by uploading relevant vehicle documentation through the app.
The digital loan aspect of Agar addresses two specific needs: Agar for Drivers allows taxi operators to secure quick loans for vehicle repairs, while Agar for Salaried Employees provides salary advance loans without collateral before paydays. Additionally, the service helps customers with insurance premium payments, featuring repayment options from one to nine months.
Despite having one of the lowest insurance penetration rates globally, the growth of technology in Ethiopia presents new opportunities for tailored financial services. Recently, a partnership between ride-hailing company Little Ethiopia and Lion Insurance introduced coverage for passengers and drivers, further indicating the growing interest in digital insurance solutions.
Mikias Fekadu from Kacha noted that the development of this platform took a year and a half, emphasizing that access to digital loans requires transaction history from Global Bank. Users must visit a branch for service activation, and loans of up to 50,000 birr can be arranged through the Kacha Wallet based on automated credit scoring. Delays in repayment can incur penalties for noncompliance.
Martha Hailemariam from the National Bank of Ethiopia stressed the importance of maintaining robust cybersecurity protocols while managing sensitive customer data. The central bank will continue to support the trio in ensuring the successful implementation of these innovative services.
The launch of Agar marks a significant advancement in Ethiopia’s fintech landscape, providing an integrated approach to digital credit and insurance services. By simplifying access to insurance and offering tailored loan products, the partnership between Kacha, Lucy Insurance, and Global Bank aims to increase financial inclusion in Ethiopia, especially in a market with historically low insurance penetration. With support from regulatory bodies, this initiative presents a promising future for digital financial services in the region.
Original Source: shega.co
