Bank of Abyssinia leads the way in Shari’ah compliant banking

Driving innovation in Ethiopia’s Islamic finance market

The Bank of Abyssinia (BoA), a pioneer in Ethiopia’s financial services landscape, is on a mission to expand financial inclusion and lead the country’s growing interest-free banking (IFB) sector. With nearly three decades of service, BoA has become synonymous with innovation, customer trust, and Shari’ah-compliant banking excellence.

Bridging regulatory and technological gaps

Following Ethiopia’s 2019 regulatory reforms that enabled full-fledged Islamic banks, BoA faced a significant challenge. The bank needed to rapidly scale its interest-free offerings but was constrained by legacy systems built for conventional banking. With no standardized Islamic banking platforms readily available in the market and evolving regulatory requirements, BoA required a purpose-built solution to remain competitive, compliant, and efficient.

Strategic partnership with Azentio

To meet these demands, BoA partnered with Azentio to implement iMAL, a comprehensive Islamic core banking system. The platform enabled the bank to:

1. Rapidly launch Shari’ah-compliant products that meet regulatory standards.
2. Automate profit-sharing with custom rules and pool structures.
3. Reduce operational costs and manual tasks through streamlined workflows.
4. Enhance customer trust with fair and timely payouts.
5. Minimize disputes and audit preparation time with real-time reporting.

A testament to transformation

With iMAL, BoA achieved measurable success in scaling its IFB operations:

1. 6.07 billion birr mobilized in 2024 IFB deposits, contributing to a total IFB portfolio of 24.14 billion birr.
2. Automated, accurate profit-sharing improved operational efficiency and minimized manual tasks.
3. Enhanced customer confidence and loyalty through timely, transparent profit payouts.
4. Reduced disputes and audit preparation time thanks to real-time reporting and audit-ready records.

Daniel Hailu, CIO of Bank of Abyssinia, remarked: “With Azentio, we’ve achieved full Shari’ah compliance while streamlining our operations and delivering transparent, efficient services to our customers. The solution has been a reliable backbone in our journey to scale and lead in Ethiopia’s interest-free banking sector.”

BoA’s journey shows what’s possible when purpose meets innovation. Where the future of banking is digital and Shari’ah-compliant, BoA partnered with Azentio to not just transform, but to lead, inspire trust, and shape the future of Islamic finance.