Banks Face Financial Strain Over Proposed Fayda Digital ID Verification Fees

A new verification fee for checking customers against the Fayda digital ID system is causing financial concern for Ethiopian banks during a period of escalating operational expenses. Data shows that total expenses across the banking sector surged by 91.9 percent to reach 525.7 billion Birr in 2024/25. Expenses consumed 81.3 percent of total bank revenues, up from 75.8 percent in the previous period, severely squeezing profit margins. With banks making up to two million identity verification requests per day, per-check fees threaten to further erode profitability. Financial analyst Aminu Nuru, based in Doha, Qatar, criticized the current monetization framework of FaydaVerse. He argued that charging for basic identity verification like name and age is inappropriate because basic identity verification is a fundamental government responsibility. Instead, Nuru suggested that FaydaVerse should charge for value-added services such as credit scoring or fraud history to build a viable revenue stream.