Ethio Telecom, Awash Bank Introduce New Financial Service Suite Including Salary Loans Up to 1M Bir

A new partnership between majority state-owned Ethio Telecom and Ethiopia’s most profitable private commercial bank, Awash Bank, was unveiled today, introducing a menu of collateral-free micro-credit, savings, SME lending and device-financing services. The offering, branded Tilla, will be delivered through Telebirr, the telecom operator’s fast-expanding mobile money platform.

The rollout comes at a moment of extraordinary growth for Awash Bank, which reported gross profits of more than 22 billion Birr for the 2024/25 financial year, a 113 percent jump from the previous year. The bank has been working to deepen its digital footprint in Ethiopia’s financial sector. Earlier in the day, its investment-banking subsidiary received a license from the Ethiopian Capital Market Authority, marking another milestone in the sector’s slow but steady shift toward modernized, regulated financial services.

At the heart of the new service is a tiered credit system that ranges from short-term micro loans to large salary-based financing. The micro-credit products start with a 15-day loan from 500 Birr upward, extending to a six-month salary loan that climbs as high as 1 million birr and can be repaid over 16 months. Facilitation fees start at 1.25 percent for the briefest loans, with additional daily charges between 0.5 and 1.25 percent. For the 40-day and 75-day loans, the same daily fees apply, although first-day facilitation fees rise to 4.5 percent and 6.5 percent respectively.

The six-month salary loan carries a 22 percent facilitation fee, with penalties beginning at 0.11 percent for late payments. This product is reserved for employees whose salaries are paid through Telebirr or Awash Bank, a mechanism designed to tie credit access more closely to the mobile money ecosystem. 

Eligibility for the micro-credit products depends on a customer’s previous six months of Telebirr transactions. Airtime purchases, bill payments and transfers are among the variables used to assess borrower reliability. In contrast, Awash’s salary-loan product uses only payroll history through Telebirr as its basis for approval.

For Ethio Telecom, the partnership marks an expansion of its relationships with formal financial institutions, bringing the number of its micro-credit partners to four. The company has disbursed above 31 billion Birr in micro credit since it was kicked off nearly three years back. 

Frehiwot Tamiru, the company’s chief executive, said during the launch at the Science Museum that the company aims to ensure nearly half of all digital transactions in Ethiopia pass through Telebirr in the next three years. She reiterated the company’s target to lift Telebirr’s customer base to 62.5 million this year, up from about 54 million only months ago, as part of its new three-year strategy. The Bank has prepared reserves of about 2 billion Birr for the loan service according to Frehiwot.