Yetim EPayment Service Proposal

A Proposal for Content Provisioning
Platform of mobile financial service

As a Value Added Service
To: Ethiopian Telecommunication
Corporation (ETC)
Submitted by: Yetim ePayment Service

Version 1.0
September, 2010
Addis Ababa, Ethiopia
Yetim is an innovative e-money service which is

believed to change the way of life in Ethiopia
Table of Contents
1.
Introduction..................................................................................................................................... 1
2.
Understanding of the ETC Requirement of the RFP for Content Provisioning .................................... 2
3.
Yetim ePayment Services PLC: The Company and its associates ....................................................... 3
4.
3.1.
Yetim Company Profile and History........................................................................................... 3
3.2.
iVeri Payment technologies; Profile, Service Certifications, License, and Reference ................... 7
Yetim: The Business Model .............................................................................................................. 9

4.1.
Yetim: The Solution and the Service.......................................................................................... 9
4.1.1.
The solution ....................................................................................................................... 10
4.1.2.
The Service ......................................................................................................................... 11
4.1.3.
Workflow for each type of service ...................................................................................... 12
4.1.3.1.
Buying electronic money (for the first time)..................................................................... 12
4.1.3.2.
Subsequent purchase of electronic money or cash deposit .............................................. 13
4.1.3.3. Transfer electronic money to a friend or family member (P2P transfer) ............................... 14
4.1.3.4. Withdrawing money or converting electronic money to cash .............................................. 14
5.
4.1.3.5.
Pay e-money to merchants for goods or services purchased ............................................ 16
4.1.3.6.
Airtime top-up ................................................................................................................ 18
4.1.3.7.
Bill payment using e-money ............................................................................................ 18
4.1.3.8.
Microfinance payments .................................................................................................. 18
4.1.3.9.
Payroll administration..................................................................................................... 19
4.1.3.10.
Balance inquiry ............................................................................................................... 19
4.1.3.11.
PIN Change..................................................................................................................... 20
4.1.4.
Methodology of managing content provisioning ................................................................. 21
4.1.5.
Service users ...................................................................................................................... 22
Why Yetim?.................................................................................................................................... 23
6.
Yetim Content marketing strategy .................................................................................................. 24
7.
Yetim Content Provisioning and Interface ....................................................................................... 24
8.
Content Language and Culture ....................................................................................................... 26
9.
Price and Business Plan .................................................................................................................. 26

9.1.
Yetim Price Scheme (Tariffs) for each service .......................................................................... 26
9.2.
Yetim Business Plan for each service ....................................................................................... 27
10.
Market Justification.................................................................................................................... 28
11.
Financial Proposal and Commercial offer.................................................................................... 29
12.
Technical Capabilities ................................................................................................................. 30
12.1. The Mobile Network Operator (MNO) .................................................................................... 31

12.2. Yetim ePayment service Data Center ...................................................................................... 32
12.2.1.
The Software Platform............................................................................................................ 33
12.2.2.
The Server Hardware .............................................................................................................. 35
12.2.3.
Interconnectivity Devices ....................................................................................................... 36
12.3.
Mobile Channel Module ..................................................................................................... 36
12.3.1.
SMS (Short Message Service) Gateway ................................................................................... 37
12.3.2.
IVR (Interactive Voice Response) Gateway .............................................................................. 37
12.3.3.
USSD (Unstructured Supplementary Service Data) Gateway ................................................... 38
12.3.4.
WAP (Wireless Application Protocol) ...................................................................................... 39
12.3.5.
POS (Point of Sales) ................................................................................................................ 39
12.4.
Internet and WAN (Wide Area Network) Connection .......................................................... 40
12.5.
Customer Contact Center (Call Center) ............................................................................... 41
12.6.
Security Considerations of Yetim Network Infrastructure .................................................... 42
12.6.1.
Security aspects of SMS use ................................................................................................... 43
12.6.2.
Security aspects of IVR channel .............................................................................................. 44
12.6.3.
Security of WAP Service.......................................................................................................... 44
12.6.4.
Internet Security .................................................................................................................... 45
12.6.5.
Security aspects of Agents and connections from institutes like Banks and MFIs ..................... 45
12.6.6.
Data Center Security .............................................................................................................. 46
12.6.7.
User Security .......................................................................................................................... 46
13.
Risk Management ...................................................................................................................... 47
14.
Conclusion and Recommendation .............................................................................................. 53
15.
Annex I: Financial Forecast and Cash Flow ................................................................................. 54
16.
Annex II: ETC Opportunity Cost Saving by Using Yetim Top-up service ........................................ 57
17.
Annex III: Yetim Initial Investment Outlay .................................................................................. 58
Table of Figures
Figure 1: Chart of Mobile Use Growth Rate by number of subscribers
Figure 2: Yetim Organizational Structure
Figure 3: Process Flow - Buying electronic money (for the first time)
13
Figure 4: Process flow of transferring electronic money to a friend or family member
14
Figure 5: Process Flow of Withdrawing money or converting electronic money to cash for Yetim eMoney
User
15
Figure 6: Process Flow of Withdrawing money or converting electronic money to cash for Non eMoney
User
16
Figure 7: Process Flow - Pay e-money to merchants for goods or services purchased - POS Managed
17
Figure 8: Process Flow - Pay e-money to merchants for goods or services purchased - Unmanaged
18
Figure 9: Yetim ePayment services Network infrastructure connection schematic
25
31
Figure 11: Yetim ePayment service Data Center Architecture
33
Figure 12: Yetim ePayment Service Logical Application Services Connectivity
34
Figure 13: Yetim ePayment Services application modules
35
Figure 14: Yetim ePayment Service Call Center Connection Schematic
41
Glossary of Terms
ICT
Information Communication Technology
MFI
Microfinance Institutes
POS
Point of Sales
ATM
Automatic Tailor Machine
MNO
Mobile Network Operator
PCI
Payment Card Industry
KYC
Know Your Customer
SMS
Short Message Service
SMSC
Short Message Service Center
IVR
Interactive Voice Response
USSD
Unstructured Supplementary Service Data
WAP
Wireless Application Protocol
SSL
Secure Socket Layer
VPN
Virtual Private Network
HTTP
Hyper Text Transfer Protocol
HTTPS
Hyper Text Transfer Protocol Secured
EVD
Electronic Voucher Distribution
Executive Summary
Until recently, operation of banks in Ethiopia have mainly concentrated in cities and big towns
providing cash based transactions, limiting the service access to the majority of the population
living in the rural area who constitute 80% of the whole engaged in agriculture.
As any developing nation the Ethiopian economy is mostly cash based. Though some sorts of
electronic payment mechanisms have been introduced recently by the banks their actual usage
is very limited due to several factors. For instance, significant proportions of the cardholders in
Ethiopia are still using their card to withdraw money from ATMs rather than to effect payment
for purchase of goods and services.
On the other hand electronic payment mechanisms are being widely used in the developed
world. Payment with card either on point of sale (POS) terminals or remotely on the internet are
being expanded significantly over the globe.
In relatively recent periods using mobile phones for payment is also being diversified in different
countries. With alarmingly increasing rate of mobile phone users in developing countries the
model of using cell phones for payment is being considered more beneficial in such nations as
other Medias like ATM, POS and computers are not easily affordable for consumers in these
countries.
Considering the technology trend, ETCs current and planned mobile coverage, and the need for
new service demand by the public at large as well as the government, we have come-up with a
complete value added service of mobile payment service in response to ETC VAS requirements.
Our proposed VAS will not only introduce new mobile payment service, but also facilitate and
aid the governments planned economic growth by enhancing payment transaction in remote
places where ETC has mobile coverage service. Furthermore, providing mobile based
transactions throughout the country where 77% of the population is unbanked, it will also fill
the gap of the governments plan to create cashless community in the coming five years, while
providing efficient and timely payment transactions.
Whilst Yetim proposed services will have the above highlighted contributions to the nation, the
main purpose of the proposal for value added services is to increase ETCs ARPU through
continuously growing mobile payment users utilizing its network on revenue/profit sharing
business model benefiting all parties involved.
Our value proposition includes partnering with financial institutes like MFIs and Banks to
achieve the required objective in a revenue sharing scheme. We believe this proposition is in
line with the Service provider of Ethiopia, Ethiopian Telecommunication Corporation, policy and
current governmental regulations.
Hoping that this document will provide the required detail, we are looking for ETCs approval to
provide us the required services.
Thanks and Regards,
Ibrahim Dawd Muzeyen
Chief Executive Officer (CEO)

Yetim ePayment Services plc
Addis Ababa,
Ethiopia
1. Introduction
Mobile phones have become an indispensable feature of life in most part of the world as
tools for communication, entertainment, and information retrieval. Mobile devices are
considered to be the developing worlds technological springboard. In 1990, there were
just 11 million mobile phone subscribers worldwide. By 1999, the proliferation of
wireless technologies had exploded to over 500 million.
Because of their ubiquity, accessibility, and ever-increasing functionality, mobile phones
promise to become a gateway to financial services far more complex than the already
existing bank based financial services.
Electronic financial services have spread rapidly. Countries and consumers are
increasingly getting connected. These new technologies not only allow countries to
leapfrog in connectivity, they also open new channels for delivering e-financial services.
Since the mid-90s investment in banking technology has focused upon online banking
and brokerage services to increase convenience.
Surveys done regarding mobile money transfer predict that significant growth in
subscribers making domestic money transfers is being observed. The number of
subscribers using mobile domestic money transfers is expected to grow to over 12% of
total subscribers in 2012 for developed markets and to 9% for developing markets. This
translates to a total of 504 million subscribers in 2012 that will make at least one money
transfer using their mobile on their phones within their own countries.
Figure 1: Chart of Mobile Use Growth Rate by number of subscribers

1
The sole telecom network and service provider, ETC(Ethiopian Telecommunications

Corporation), is currently engaged in large-scale nationwide network expansion projects.
The next-generation all-IP network project brings together GSM, CDMA, WCDMA and
CDMA2000 mobile networks as well as IP networks and landline PSTN.
ETC plans to reach a staggering 15 million mobile subscribers by 2015. The Chinese ZTE
(which is undertaking most of the current projects) and Huawei, Nokia-Siemens,
Ericsson, Alcatel-Lucent, Cisco and other telecom network solution providers have been
involved with ETC in the past in its telecom network and service provision endeavors for
a subscriber base, as of current information is about 7 million, that has been deemed as
one of the lowest in the world.
Yetim is a company that is incorporated to provide a Mobile Financial Service solution to
Ethiopian Market using the mobile as a prime tool for payment transactions from person
to person and person to merchant/agent or to any financial or microfinance institute
that aspires mobile Payments benefits. Yetim ePayment Service will create various and
multiple channels for payment transactions to provide fast and convenient financial
service to the unbanked society through financial institutions like MFIs and Banks
operating in Ethiopia. The following subsequent topics discuss the value proposition, the
solution and the partnership that needed to be incorporated to achieve the requirement
in Ethiopian context. And also the value proposition to ETC in facilitating the payment
mechanism through its network with a revenue sharing business model that will benefits
all parties involved in the operation.
2. Understanding of the ETC Requirement of the RFP for Content

Provisioning
Understanding ETCs requirement for the RFP for Value Added Services, a detail overview
of the proposed Yetim service offering and strategic engagement scenario with
users/customers, merchants/agents, banks and MFIs need to be analyzed to address the
need.
In a mobile financial service business model there are multiple strategic engagement
scenarios that are currently exercised in the business ecosystem around the world.
Different scenarios may be applied in different market conditions and scopes
(international, national or niche markets). Although other scenarios were already
available, the following three scenarios describe the main alternatives for the Ethiopian
Implementation of the mobile financial service provisioning. These alternative scenarios

are namely the Operator centric, the Bank/Service Provider Centric and a Third party
financial service provider centric models.
Appreciating the ETC requirement on providing the service with third party processors
and other stake holders like Banks and MFIs, it is the result of most case studies done on
the mobile commerce eco-system to provide the service in collaboration with the
financial service providers of the country.
3. Yetim ePayment Services PLC: The Company and its associates

Yetim is a third party service provider that will be a financial gateway for mobile and
other types of transactions that are viable to its objectives.
Yetim ePayment Services PLC is a company incorporated to provide financial solutions to
Ethiopian Market with a business model that emphasizes on Revenue sharing
mechanisms with financial solutions provider companies. As to the establishment Yetim
Partnered with company named IVeri payment technology based in South Africa to
implement the Core Multi Channel gateway application software solution.
3.1. Yetim Company Profile and History
Vision
Be the leading catalyst in accelerating the growth of electronic payment in Ethiopia
Mission
To promote fast, convenient, secure and reliable forms of electronic payment through
innovation and implementation of cutting edge technology
Major Objectives
In the realization of the above vision and mission statements Yetim will strive to achieve the
following objectives.
Assisting banks, MFIs and other financial institutions to reach the unbanked and underbanked population
Facilitating money transfer services to and from the rural community

Reducing physical cash circulation
Enhancing electronic payment
Increasing customer base to banks and MFIs
Generating income to the promoters
Playing a tangible role to the Ethiopian economy
Establishment
Yetim is a private limited company established with four shareholders at a capital of Br.
500,000.--, which will grow significantly once system installation is done. The
shareholders are known and well respected business individuals playing significant
positive roles in different sectors of the economy including technology, financial,
mapping, real-estate and transport services. They believe that achieving the above cited
objectives will create them another opportunity to contribute their share to the growth
and development of the country.
Yetim ePayment Services has taken further steps by investing on the latest,
internationally accredited advanced solutions multichannel Payment Gateway ready for
use prior to VAS agreements demonstrating its commitment to provide world class
payment services.
Yetims payment technology solution strategic alliance, iVeri is a well recognized
electronic and mobile payment solution provider with international Visa/Master/PCI
DSS accreditations and has wide installation bases. Brief profile of iVeri is described
below enclosing references.
Yetim Organization structure
Figure 2: Yetim Organizational Structure
Roles and responsibilities of the CEO and the different work units
1. Chief Executive Officer
Develop policies and operating procedures

Set annual and quarterly targets of the company and monitor
implementation
Supervise the activities of the different work units
Approve payments and control all financial movements of the company
Monitor proper maintenance of financial statements

Represent the company for all external communications including negotiation
and signing of contracts
Identify risks and implement proper risk management mechanisms
2. Information technology
Administer the hardware, software and network components

Make sure that redundancy and disaster recovery components are in place to
guarantee utmost level of business continuity in all circumstances
Follow up of hardware and software maintenance contracts signed with
technology provides and ensure that SLAs are always intact.
Supervise the activities of the24X7 call center and properly respond to
customer complaints
Always ascertain that appropriate system sizing is in place
Design technical specification for new product development ideas
3. Marketing and Product development
Create the necessary awareness on Yetim and its benefits

Promote the Yetim brand in collaboration with the customers i.e. financial
institutions
Conduct periodic surveys to identify the level of customer satisfaction and
propose improvement mechanisms based on their feedback
Monitor global e-payment trends and propose innovative ways of adopting
latest technology
Design business requirements for any suggested innovation
4. Finance and Administration
Maintain the recording of books of accounts

Reconcile cash with bank balances and follow-up on pending items
Produce quarterly and annual financial statements

Prepare and deliver monthly settlement and reconciliation reports to each
customer i.e. bank and/or MFI
Investigate customer complaints on settlement
Assess financial viability of any new idea generated by the marketing and
product development wing.
Administer the Companys payroll and maintain staff records
Facilitate annual audit by external auditors
3.2. iVeri Payment technologies; Profile, Service Certifications, License,

and Reference
Yetim has collaborated with company named Ivery Payment technologies for its Core software
platform deployment of the payment solution. The short profile of which is described below.
Introduction to iVeri
iVeri creates technology for banks and businesses to facilitate multiple-channel transaction
acceptance. Their goal is to help customers create a profitable and sustainable business by enabling
them to implement the right transactional channels for their market environment.
They have been developing electronic payment technology since 1998. Today, they process millions
of transactions and have customers in several countries. iVeri is a proven provider of best-of-breed
multiple channel transaction technology.
iVeri provides a Transaction Gateway that supports multiple-channel card acceptance and a Personal
Banking solution that allows account holders to use a range of communication channels to access
their bank accounts.
iVeris Transaction Gateway provides mobile, internet, recurring payment, point of sale and card-notpresent card acceptance channels, as well as comprehensive reporting and back-office functionality
for both the bank and the merchants.
iVeris Personal Banking solution MiBank allows account holders to utilize the technology at their
disposal to access their bank account and perform a range of transactions. Mibank supports voice,
mobile phone, internet and email interfaces.
Their experience gives them a distinct advantage when meeting the demanding needs of banks and
businesses requiring multi-channel transaction acceptance. Their customers agree that their unique
products, coupled with tried-and-tested back-office solution and a dedicated team of engineers,
have been key to their success.
Their specialist knowledge of transacting in Developing Economies has resulted in the design of
innovative and cost-effective solutions aimed at providing world-class services to underserved areas.
Key Successes
-
Process over 1.6 million transactions a month to the value of about USD100,000,000
Supplier to the 4th largest bank in Africa
Solutions in 6 African Countries
Transaction Gateway supports 10 transaction delivery channels for card processing
MiBank Personal Banking supports 7 channels to access e-money accounts
Forward Strategy
-
Reduce the barriers to entry in the transaction processing market for clients
Continue to develop and implement new transaction channels
Partner with local support companies to provide in country on-site support to clients
Work with clients to find solutions to their unique transaction and payment challenges
Customer Base
-
Nedbank, one of South Africa's big four banks has an exclusive distribution agreement with
iVeri for South Africa. iVeri also provides services to Nedbank Namibia.
iVeri is certified to Credit Card Services Company SAL, a bank registered in Lebanon and
providing services to developing countries.
iVeri is certified to Mediterranean Smart Card Company, a Third Party processor registered in
Egypt and providing services to developing countries.
Cards Technology Limited in Lagos, Nigeria is the MasterCard processor for Nigeria. CTL uses iVeri
to provide internet and mobile card solutions to its customer banks.
Chams a listed company in Nigeria uses iVeris Transaction Gateway across a range of their
business units to support card acceptance and a Mibank product for full mobile banking
I&M Bank in Kenya who are the first bank in Kenya to provide internet acquiring to the market
uses iVeri Transaction Gateway.
Dashen Bank in Ethiopia uses iVeri to provide internet and mobile card solutions including
money transfer to its customer.
CBZ Bank in Zimbabwe uses iVeris full Transaction Gateway.
Shareholders
iVeri is owned 51% by RJB Trust and 49% African Development Corporation. African
Development Corporation (ADC ) is a business development company with private funding,
investing in companies across the African continent. The African Development Corporation is
managed by a subsidiary of Altira AG (www.altira-group.de), one of the leading independent
asset management companies in Germany.
Geographic and General Representation
iVeris head office is located in Sandton, South Africa. iVeri also has a permanent representative
based in Nairobi, Kenya. iVeri is also represented by regional resellers in Kenya, Tanzania,
Uganda, Rwanda, Burundi, Ethiopia, Malawi, Zimbabwe, Zambia, Mozambique, Botswana, India
and Nigeria.
Certification
iVeri has been a member of the International MasterCard Vendor program for the last 4 years.
iVeri is a fully certified PCI DSS level 1 solution.
4. Yetim: The Business Model

The mobile payment solution only has a chance to be accepted on the market if it is profitable for the
key players to support and promote the service. All the features, offered to the end users, the security,
the comfort, the wide reach may be in vain if there is no economic incentive for the service providers
and banks. However, it is obvious also that the service providers alone cannot gain success if the users
are dissatisfied with either the service or the terms of usage. With this regard the Yetim Business model
is devised in a way where each party involved in the transaction will get satisfied.
4.1.Yetim: The Solution and the Service

With the following major features the business model is designed in a way to cover the country
at large serving for most payment needs of the public.
The technology channels to be used are mobile connection options GSM, GPRS and
CDMA spread almost all over the country.
No need for separate registration. Individuals can use their cell phone to convert their
cash to electronic money or vice versa; their personal identification will be taken at this
stage in accordance with the KYC (Know Your Customer) principle of the Government
Financial Regulations.
It facilitates providing financial services to unbanked polulation and enhances micro

saving. For instance, one can receive his salary in the form of e-money and spend same
in exchange for cash, goods or services as and when needed while leaving some value in
his/her account.
Any type of payment either recurrent or one time can be supported using e-money
Transacting with voice instruction on IVR is much convenient to most Ethiopians. Hence
low level of training is required.
The system is multi-lingual. The service will be given initially using the widely spoken local
languages of Amharic, Oromifa and Tigrigna together with English as a foreign language.
4.1.1. The solution

The increasing need for mobile phones and the corresponding capacity diversification of the
Ethiopian Telecommunication Corporation is a vivid fact in Ethiopia. Within the last two years
alone the number of mobile subscribers has almost doubled. With this accelerated growth the
number of mobile subscribers now reached about 7 million while the fixed phone users
stagnate at below one million, which is only less than 15% of the mobile subscribers.
Such developments are opportunities worth exploiting for the diversification of electronic
payment methods in the country so that majority of the unbanked population will play a role in
the formal financial industry than being hidden behind the curtain.
The core of the idea is to convert physical cash circulating in the country to electronic money
that can serve as a means of value exchange in a more convenient, safe, reliable and flexible
manner both to the payer and to the payee. Mobile phone (through GSM GPRS, CDMA 1x& 3G)
and even fixed telephone lines will therefore be important Medias to facilitate the process.
Implementation of the concept will have significant benefits from the national economic
development perspective. It will open the door in bringing measurable proportion of the
population to the formal financial sector through converting their physical cash to electronic
money which will be more controllable. This will obviously provide tangible advantages in better
10
controlling the national monetary movement. Besides, the diversification of electronic payment
methods will reduce the national budget required for production and distribution of paper
money.
Furthermore, it will also help in assisting the unbanked majority of the Ethiopian community to
adopt modern ways of managing their hard earned money. The safety feature of the e-money
model will also protect users from being exposed for theft while moving physical cash from
place to place. In addition, due to its high level convenience of being handled on ones own
mobile phone without the need to invest money on equipments more users are expected to
enjoy the service.
For banks and financial institutions involved in the implementation of the scheme it opens the
door for increasing their customer base, which will give them a great level of cross selling
potential besides its advantage in bringing additional revenue stream to them.
4.1.2. The Service

At a minimum the following services will be obtained from Yetim.
Buy electronic money in exchange for cash
Transfer electronic money
Convert electronic money to cash
Pay electronic cash to buy goods or services
Top-up of prepaid airtime
Settle utility bills
Disbursement and collection of Micro credit by Microfinance institutions
Distribution of payroll
Inquire balances
Change PIN
11
4.1.3. Workflow for each type of service
4.1.3.1.
Buying electronic money (for the first time)
A potential customer may approach an agent

As a new applicant he/she will fill the application form and present a valid ID card
for identification
The agent will capture the data on the POS from the application form
The agent will take the picture of the customer and ID card using the POS
The agent shall then process the transaction on the POS
The customer shall receive SMS confirmation for the credit of electronic money
to his/her e-money account together with a four digit PIN
The customer shall then pay the amount to the agent and take a POS receipt
from the agent.
If the SMS couldnt be delivered immediately and if the message is seen as
pending on the POS the customer should be notified of this case and should be
given copy of the application form after being signed by the officer in charge to
serve in place of the POS receipt.
If customer couldnt obtain the SMS confirmation after a receipt is printed by the
POS, the case shall be investigated immediately as it may be because of filling a
wrong beneficiary mobile number. If that is the case a reversal shall be done
immediately by the agent and the correct transaction should be passed again.
The agent should then send a predefined SMS to the wrong beneficiary from the
POS terminal requesting for apologies.
12
Figure 3: Process Flow - Buying electronic money (for the first time)
4.1.3.2.
Subsequent purchase of electronic money or cash deposit
An existing customer may approach an agent for cash deposit

The customer shall fill the e-money purchase form (cash deposit form)
The agent will process the transaction on the POS
The POS will print a receipt confirming the transaction
Customer shall also get an SMS message as additional confirmation
If SMS message is not delivered due to problem on the SMS gateway customer should be
notified of the case by the agent based on the pending message on the POS
If the SMS message does not reach the customer after delivery confirmation is obtained
on the POS the case shall be investigated and the transaction capturing process must be
checked immediately. The potential cause for this is error on typing the customer
account number. Hence, a reversal should be done immediately and the process shall be
done again with the correct account number
The agent shall then send a predefined SMS via the POS to the user who received a
wrong message to ask for apologies.
13
4.1.3.3.
Transfer electronic money to a friend or family member (P2P transfer)
The person will dial 511 and follow instructions to transfer e-money
An SMS confirmation of the transaction will reach the sender
The receiver will also receive an SMS confirming the e-money transferred
together with the reference number of the transaction. If the receiver does not
have a GSM the reference number will be given to him/her by the sender.
Figure 4: Process flow of transferring electronic money to a friend or family member
4.1.3.4.
Withdrawing money or converting electronic money to cash
a) For E-Money customers
The user will approach an agent and fill the cash withdrawal form
The agent will process the transaction on the POS after properly identifying the
customer
The POS will print receipt for the transaction
The user will receive SMS confirmation of the transaction
14
The agent will pay the amount requested to the customer after obtaining his/her
signature on its copy of the POS receipt
Figure 5: Process Flow of Withdrawing money or converting electronic money to cash for Yetim
eMoney User
b) For Non E-Money customers
When a non registered user approach an agent to withdraw the cash he received from his
friend or relative the agent should first capture him or her as a user. This will also help as a
form of additional security as registration requires detail KYC. Then the whole process given
above will be applied.
15
Figure 6: Process Flow of Withdrawing money or converting electronic money to cash for Non
eMoney User
4.1.3.5.
Pay e-money to merchants for goods or services purchased
a) For merchants who are using POS terminals
User approaches a merchant
Buy the goods or services he needs
The merchant will process the transaction on the POS
The POS will provide receipt of the transaction in two copies
The user will also obtain SMS confirmation of the transaction
The user shall sign the merchants copy of the receipt and take the goods/services
bought
16
Figure 7: Process Flow - Pay e-money to merchants for goods or services purchased - POS
Managed
b) For owner managed merchants
Owner managed merchants will not be provided with POS. They can use their own
mobile phone to accept e-payment for the goods/services they sell. Thus, the process
used for P2P transfer will be used.
17
Figure 8: Process Flow - Pay e-money to merchants for goods or services purchased Unmanaged
4.1.3.6.
Airtime top-up
To provide this service airtime should be purchased from ETC and loaded on the system
for subsequent retail or Yetim will make arrangements with ETC to facilitate online
purchase via direct interface. In both cases the user is expected to dial 511 and follow
instructions for airtime top-up.
4.1.3.7.
Bill payment using e-money
With agreements to be signed with utility companies bill collection will be done via
Yetim. The utility company or its authorized agent will handle the bill presentment and
Yetim will facilitate the payment aspect. After obtaining the bill value the user can dial
511 and follow instructions to make payment.
4.1.3.8.
Microfinance payments
Operation of micro-finance is becoming increasingly important to the emerging
economies as it gives the ability to advance funds into the sector as well as receive
repayments on loans already advanced.
18
One case scenario involved a customer who was required to make regular weekly or
fortnightly repayments but to do so involved one whole day of travel to reach an office
that could accept the payment. That requirement resulted in the customer being
unavailable for productive employment on that day and if a five-day week was assumed,
the loss of productivity is around 20 percent. The use of the Yetim financial service will
be helpful to solve this issue.
Microfinance institutions can, therefore, use the Yetim platform to disburse as well as
collect Microcredit extended to their customers.
Upon extending Microcredit an e-money account will be opened to the
customer, which will be credited with the value of the loan. Proper KYC will be
applied on the customer before opening the e-money account.
The value of the credit as well as amount and frequency of period settlements
will be configured on the system
The customer will use the e-money account to withdraw cash, to transfer money
or to effect payments.
Upon the date of the settlement the system will debit the value of the periodic
payment from the e-money account with a credit of the MFI master account
with Yetim. If the customer does not have sufficient e-money balance for the
repayment, the e-money account will be overdrawn and upon which the MFI will
claim the cash payment from the borrower who will be required to make cash
deposit to the e-money account at any Yetim agent, without being limited to his
MFI branch.
4.1.3.9.
Payroll administration
Companies can use the Yetim system to pay salaries in the form of e-money. Each
employee may need to pass the KYC requirements and will accordingly have Yetim emoney account. The employer will either electronically or manually, as the case might
be, forward the net monthly pay to be credited to each employees e-money account,
which will be loaded on the system of Yetim for the appropriate update of employees emoney accounts.
4.1.3.10.
Balance inquiry
19
E-money users should be allowed to check their e-money balances at any time. They can
do this by dialing 511 and following instructions or by sending SMS to the system in a
predefined format.
4.1.3.11. PIN Change

As part of securing the entire operation users should be allowed to change their PIN at any time.
They can do this by dialing 511 or through the internet.
20
4.1.4. Methodology of managing content provisioning

The company will sell this innovative service to micro-finance institutions, banks or the post
office operating in the country. It will implement the entire system and the necessary call center
and serve as a third party processor to interested financial institutions.
The micro-finance institution, the bank or post office which wants the service will assign their
branches all over the country as agents to receive cash and pay cash in exchange for e-money.
The following will be the arrangement in handling e-money transactions.
a. The Network Operator: Ethiopian Telecommunication Corporation
The corporation is a key component in providing the required infrastructure and
connectivity solution to facilitate the service. The involvement will create a sound and
reliable service offering for Yetim and better capacity utilization of ETCs Mobile network.
The provision of the mobile commerce and financial services is capable of generating a
healthy revenue stream for ETC, but more importantly, it may create an additional
incentive to take up mobile services. Although the added customers are unlikely to be
volume users of the mobile services, they will still contribute in a material way to the
operators net earnings.
b. Institutions
Institutions are like Banks, Microfinance institutions, and the Post office who wants to
serve customers using the solutions of Yetim ePayment services PLC. Institutions need to
sign contract with Yetim to start serving customers with Yetim. Institutions should notify
the number and location of branches where they need to provide the Yetim service.
c.
Agents
Agents are branches of institutions who are assigned to register customers as well as to
pay and receive cash. Agents shall be supplied with POS machines on which they register
customers, pay out cash and receive cash.
21
d. Merchants
Merchants are traders who are authorized to accept Yetim ePayment for the goods
and/or services that they sell. Merchants need to have accounts with those financial
institutions partnering with Yetim in using its technology platform.
Those owner managed merchants will use their own mobile phones to accept payments
in the form of e-money. Other corporate merchants where the front desk cashier is
different from the owner will be provided with POS terminals on which they will process
e-money payments.
e. Users
Users are mobile phone subscribers who are registered to have e-money accounts. Upon
registration at a branch location of a financial institution, users shall be assigned with emoney accounts on the Yetim platform. The Institution or bank that first registers the
customer for e-money service is the owner of the users e-money account.
4.1.5. Service users

The Yetim e-money service is to everyone in Ethiopia. Any person can buy and spend e-money.
With this in mind the e-money service can be used in the following ways.
For urban dwellers to transfer money to parents in rural areas
For parents to transfer money to students in towns or universities
For any form of money transfer
For employers to pay salary to their employees
For anyone to purchase goods and/or services from any merchant location
For prepaid airtime top-up
For settlement of utility bills
For settlement of loans to micro-finance institutions
22
For effecting periodic payments to associations or cooperatives
For Parents to pay school tuition fees of their children
For payment of any periodic payment like insurance premium
And wherever payment is needed
Thus, we can see that the Yetim e-money can serve everywhere to satisfy payment needs of the
public. That is why it is called Yetim. It is because of this feature of Yetim we confidently claim
that it is the only way to accelerate the shift from cash to electronic payment.
5. Why Yetim?
Implementation of the concept will have significant benefits from the national economic
development perspective. It will open the door in bringing measurable proportion of the
population to the formal financial sector through converting their physical cash to electronic
money which will be more controllable. This will obviously provide tangible advantages in better
controlling the national monetary movement. Besides, the diversification of electronic payment
methods will reduce the national budget required for production and distribution of paper
money.
Furthermore, it will also help in assisting the unbanked majority of the Ethiopian community to
adopt modern ways of managing their hard earned money. The safety feature of the e-money
model will also protect users from being exposed for theft while moving physical cash from
place to place. In addition, due to its high level convenience of being handled on ones own
mobile phone without the need to invest money on equipments more users are expected to
enjoy the service.
For financial institutions involved in the implementation of the scheme it opens the door for
increasing their customer base, which will give them a great level of cross selling potential
besides its advantage in bringing additional revenue stream to them. Not only does it generate a
cash float that can be used to improve the countrys economic situation, but it also helps to
reduce fraud, money laundering and criminal acts such as robbery because the cash assets of
the users are no longer being carried around in person.
23
6. Yetim Content marketing strategy

Using the business model described above financial institutions are the direct clients of the
Yetim service. They will be interested to buy the Yetim service as it gives a value add to their
customers. Moreover, they can concentrate on their core business leaving the technology
management side of their e-money service to Yetim including the call center. Though their
involvement in the service is only on cash in cash out activities while the majority of the
transactions are expected to be P2P transfers they will earn a proportion of the fee from all the
transactions made by users initially registered by them. This will not only encourages financial
institutions to use the service it also enhances the pace of the business growth as each
institution will keep on exploiting every opportunity in increasing the number of its registered
customers.
Yetim will strive to maintain standards of its own brand at each service location so that ultimate
users will easily identify service locations and feel familiar with the type of service they get.
Furthermore, Yetim will support the promotion and marketing efforts of institutions in the
following major ways.
Create the necessary awareness on Yetim and its benefits
Promote the Yetim brand in collaboration with the customers i.e. financial institutions
Conduct periodic surveys to identify the level of customer satisfaction and propose
improvement mechanisms based on their feedback
Monitor global e-payment trends and propose innovative ways of adopting latest
technology
Design business requirements for any suggested innovation
7. Yetim Content Provisioning and Interface

The intended service for Yetim ePayment Services will be implemented on a data network
infrastructure that will be setup based on a proven methodologies for planning, designing,
implementing, operating, and optimizing the performance of a variety of secure voice and data
network solutions and technologies.
24
As the service required is to deliver a mobile financial services including delivering a branchless
banking solution, the infrastructure should be able to deliver a fault tolerant, highly available
and very secure system access to the customer, agents and other stack holders. To achieve this
capability the network infrastructure should be designed and implemented in a redundant,
scalable, highly secure and highly manageable manner to accommodate the required services.
This requirement calls technologies and product implementation that are industry tested on
similar operation scenarios of Yetim services or other financial transaction service institute best
practices.
The Infrastructure Yetim is built on can be classified in to major infrastructure modules namely:
The mobile Network Operator(service provider), the Data center Module, Mobile access
Module(such as SMS, IVR, USSD, WAP and Internet), VPN Internet and WAN Connectivity
Module and a Call Center Module for customer contact and relation management.
25
8. Content Language and Culture

The system is multi-lingual. The service will be given initially using the widely spoken local
languages of Amharic, Oromifa and Tigrigna together with English as a foreign language. As the
service incorporates communication interfaces that are interactive to the service users or
subscribers, communication mechanisms will be catered to include cultural and linguistic
aspects of Ethiopian multi Ethnic values.
The following systems will use a multi-lingual interface for the service deployment:
-
Multi-lingual SMS to and from the subscriber of the service
Multi-lingual IVR to and from the subscriber of the service
Multi-lingual USSD to and from the subscriber of the service
Multi-lingual WAP to and from the subscriber of the service
Multi-lingual WEB Portal and email to and from the subscriber of the service
Multi-lingual Call Center service catered to the deployed services
9. Price and Business Plan

9.1.Yetim Price Scheme (Tariffs) for each service
The following price scheme will be used for payment transactions that are going to be
deployed on Yetim ePayment services:
Price of Service per transaction
Tariff (In Birr or Percentage)
Deposit (purchase of e-money)
Withdrawal (sale of e-money)
1.50
Transfer
1.75
Balance inquiry
0.50
PIN Change
0.50
Top-up (%)
8%
Table 1: Price Scheme (Tariffs) for Yetim Services

26
9.2.Yetim Business Plan for each service

The e-money business is volume driven. The higher the volume the higher will be the
corresponding income and cash flow. To be on the safe side we have developed the
enclosed forecast for the coming five years in a very conservative manner considering
the following.
The current number of mobile subscribers reach about 7 million and is expected to grow
by 20% annually
It is estimated to obtain 10% of the mobile subscribers as Yetim users in the first year
and addition 5% will be added every year subsequently
For the sake of increasing the number of users via encouraging purchase of e-money, the
deposit service will be given free of charge.
Minimal fee of Br. 1.50, Br. 1.75, Br. 0.50 and Br. 0.50 will be imposed on cash
withdrawal; money transfer, balance inquiry and PIN change services, respectively.
As per the current tariff of ETC on scratch card sales 8% commission is considered on
each e-voucher sell of Airtime. This could be further negotiated as we will reduce cost of
scratch card production and distribution for ETC.
Each Yetim user is expected to make an average of one deposit transaction per month.
Moreover, the average number of withdrawal, transfer and Balance inquiry transactions
is estimated to be 2 per month per user. PIN change is estimated to be done by a user
once in six months on average. Each user will fill an average airtime of Br. 25.00 per
month through Yetim.
Upon facilitating transfer services, two SMS messages will be delivered; one to the
sender and the other to the receiver. Hence, the SMS cost per transfer using existing ETC
charge for bulk SMS will be Br. 0.22 (0.11X2). All other services will involve a single SMS
with a charge of Br. 0.35.
Banks or MFIs using the Yetim service will share 30% of the total revenue earned.
27
Hardware and software maintenance cost is considered to be 20% of the investment on

hardware, software and networking.
Office and datacenter will be rented. It is estimated that a total of 500 meter square area
will be rented at a cost of Br. 150.00 per meter square per month.
Income tax will be 30% of net income before tax.
For Detailed Income statement of Yetim ePayment service operation and the forecasted cash
flow is stipulated on Annex 1 on this document. Please also refer the initial investment
outlay for Yetim infrastructure and operation on Annex II.
10.
Market Justification
As indicated previously, Yetims operation partners include banks, merchants, retail agents, topup resellers as well as MFI institutions. To illustrate the user market projection of our proposal,
here are two immediate market targets related with MFI with actual demand for the services
which currently are underway.
Currently in Ethiopia, there are 27 micro finance institutions with 3,019,284 active clients
(expected to grow to 7,000,000 in three years) operating through 537 branches which
are mainly in remote areas where other financial institutions are not present. All MFI
have identified their problem of being lack of accurate and timely transaction
information as well as creation of bankable community. With the economic growth, all
are considering mobile payment and Point-of-Sales transactions to provide loan payment
and repayments, which both require Yetim Payment services using ETC mobile network.
Related to MFI, the Ethiopian government in partnership with international donors
utilizes MFI branches to effect wages/payment transactions for the 7,400,000 SafetyNet
workers throughout the country due to their presence in the remote areas. To enhance
payments and reporting, use of mobile and point-of-sales is being considered by the
government and World Bank in a period of 1-2 years period. Easier references of similar
successful mobile payments for SafetyNet projects include Malawi, Kenya, Rwanda and
etc..
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11.
Financial Proposal and Commercial offer
Yetim promotes revenue sharing strategy, as this has proven to be the ideal approach to ensure
long term success of the solution and the parties involved to achieve the objective. This
approach breaks the traditional vendor customer model as it continues to be in the interest of
all the technology providers to grow the market and customer base.
Today technology and markets are continually evolving; ETC needs a partner to provide future
proof technology. Our revenue-share model commits the parties involved like ETC, MFIs and
Banks to continuously provide a solution that meets future requirements for underlying huge
customer base.
The following is our revenue sharing scheme, where aware of any variances or unforeseen
issues we may at our discretion do a full assessment of the MNO and Banks options and provide
a quote on the variances.
Revenue sharing Scheme
Banks or MFIs using the Yetim service will share 30% of the total revenue earned.
Hardware and software maintenance cost is considered to be 20% of the investment on
hardware, software and networking.
ETC, on providing the solutions listed below and future services that will enhance the service
provided by Yetim, will share 20.19% of the total revenue earned from the income:
-
Providing redundant IP based connections to ETC SMSC center from Yetim Data Center
SMS Gateway for Bulk SMS transfers
Providing on Short Numbers for USSD, SMS and IVR services for Yetim Services
Providing redundant and reliable Data Connections to Yetim Data Center for Service like
WAP and Web Portal of Yetim operation
Providing enhanced service and significant cost reduction on Data and Mobile services
for Yetim operation
Providing toll free number for Yetim call center and IVR service
Providing a high secure Network connectivity to Yetim Data Centers
On providing an SLA to the services deployed.
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Opportunity cost saving for ETC
In addition to the Income generated for ETC on deploying the services with Yetim, ETC will also
benefit with cost saving that comes with the opportunity on services like Yetim Top UP for
mobile recharge of air time.
The most of this cost saving comes from the expenditures of ETC for Card Production, Logistics,
Distribution, Storage and Risk Factor processes that are necessary to make avail and provide
scratch cards to pre-paid users of the mobile service.
Please refer to Appendix II of this document to refer the amount of cost saved by ETC on
deploying the services with Yetim.
12.
Technical Capabilities
The intended service for Yetim ePayment Services will be implemented on a data network
infrastructure that will be setup based on a proven methodologies for planning, designing,
implementing, operating, and optimizing the performance of a variety of secure voice and data
network solutions and technologies.
As the service required is to deliver a mobile financial services including delivering a branchless
banking solution, the infrastructure should be able to deliver a fault tolerant, highly available
and very secure system access to the customer, agents and other stack holders. To achieve this
capability the network infrastructure should be designed and implemented in a redundant,
scalable, highly secure and highly manageable manner to accommodate the required services.
This requirement calls technologies and product implementation that are industry tested on
similar operation scenarios of Yetim services or other financial transaction service institute best
practices.
30
The Infrastructure Yetim is built on can be classified in to major infrastructure modules namely:
The mobile Network Operator(service provider), the Data center Module, Mobile access
Module(such as SMS, IVR, USSD, WAP and Internet), VPN Internet and WAN Connectivity
Module and a Call Center Module for customer contact and relation management.
The following sub topics will discuss on each major module of Yetim Infrastructure components:
12.1. The Mobile Network Operator (MNO)

The Mobile Network operator (MNO) is a core component for all the services that are planned
to be deployed by Yetim payment systems. The security on the Mobile Network Operator is a
critical concern in securing an infrastructure that is totally based on services that are passing
through a network that is operated by a service provider like ETC.
The services that are passing through the service provider or MNO are: SMS, USSD, IVR, and
WAP requests of financial kind. And all these service channels include user credentials and
transaction data of the payment service. The major security threats that come from the service
31
provider side on this technology channels, is interception of the data transmission on services
like SMS and IVR on the Mobile operator network switches facilities.
Access facilities to the mobile channels will be provided by ETC with Yetim subscription. It is
observed that the sole MNO of the country has not currently deployed some of the
technologies that are required to make the service robust. These technologies include the use of
single cable direct connection to communication channels like SMS and IVR gateways. And also
the use of short number telephone numbers for IVR and call center services. The initial
implementation of Yetim might not include this added technology benefits to decrease the
hardware and management headraces of some services. However, the MNO is currently on the
process of deploying these services and Yetim will implement or include these technology
options phase by phase hand in hand with the MNO deployment schedule and policy.
12.2. Yetim ePayment service Data Center

Yetim Data Center will house the main ePayment Software platform that will be used to transact
customer account data from Servers interconnected with high speed backbone switching
connectivity to and from the customer accessing the system through SMS, GPRS, WAP, Internet,
and Interactive Voice Response (IVR). The system will also be connected to Internet and Wide
Area Network connection with a telecom infrastructure and serves customers and retail agents
securely through VPN tunnels. These customers and retail agents will have a Yetim Service
Portal interface that will be hosted on the web servers of the Yetim Data Center. The data
Center is implemented on four major network components required for the intended service
namely: The software Platform, the server Hardware, Interconnectivity Devices and
Miscellaneous Data Center Infrastructure equipments.
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Figure 11: Yetim ePayment service Data Center Architecture
12.2.1.
The Software Platf orm
The softwares that are deployed on the Yetim Infrastructure will be installed and configured
after performing various analysis and implementation base comparisons of electronic
transaction services by the system design engineers employed for the intended purpose. The
software platforms on Yetim implementation include Operating system softwares, Application
Softwares and Management Softwares.
Mixed Operating system architecture is used to accommodate the hosted services installation
pre-requisites. Microsoft is the main platform operating system that is implemented for
Applications such as Core channel management and service provisioning server, Data Base
Service, Web and Directory Servers. Linux Operating system is also used for SMS and IVR
applications.
33
Figure 12: Yetim ePayment Service Logical Application Services Connectivity

The core and the very important application software service that will be running on Yetim Data
Center are the channel management and service provisioning applications. The application is
used for the various Value Added Services typically offered by mobile financial service providers
over mobile network operators. These include: Short Message Service (SMS), Interactive Voice
Response (IVR), Wireless Application Protocol (WAP)/General Packet Radio Service (GPRS) and
Unstructured Supplementary Service Data (USSD) portals. The application is selected according
to the technical requirements of the intended service provisioning necessities.
The Core Financial channel service is implemented with Application servers that are critically
required to the operation of the service. These are the back end data base server, the web
server and authentication and authorization servers. The backend database serves as a store
for the users accounts and profiles. The communication between the service provisioning server
and the backend database will be independent from the one between the mobile device and
the MNO. And SSL will be used for all internal communications of servers used for the services.
34
Figure 13: Yetim ePayment Services application modules
Yetim Mobile payment application servers will profile client behavior like transaction pattern so
that illegitimate abnormal usage should be detected on early basis. As an additional measure
application servers will also use an alias of user account to transmit across network as a purpose
to hide actual user account details on network. Appropriate antivirus softwares will scan the
system regularly to avoid prevalent threats caused by Virus and other malicious applications.
12.2.2.
The Server Hardware
The software platform run on a fault tolerant Data Center hardware that is capable of being
recovered from main faults that might hinder the operation of the service. All major network
services of Yetim and application will be run on Server hardware that are intended and designed
to provide non stop service to banking and transaction solutions.
The selected Yetim Servers are from range of HP Blade Enterprise products range with a
capability to grow as the operation of the system requires more resources. The servers will be
35
equipped with a large storage capacity with a fault tolerant configuration to have an instant data
back up access in case of disk or server failures. Multiple Network connection will be provided
by these servers using a multi-homing configuration in case of network link lose that might
occur due to Network interface card failures.
12.2.3.
Interconnectivity Devices
All the services that are provided by Yetim are from Server Applications that are connected to
Internetworking devices inside the Data Center. Virtually all traffic between the planned
application and clients traverses the LAN backbone of the Data Center Network infrastructure.
Hence the interconnectivity devices needs to be high-speed switching equipments and should
have a capability to switch packets as fast as possible. With this regard, LAN networking devices
will be selected from Cisco Systems products, a company that is an industry leader on the
network infrastructure sector in providing reliable equipments, Cisco Systems.
Yetim LAN backbone implementation is based on the Cisco Systems concept of Hierarchical
(Layered) Network Design, such that each layer will be responsible for a certain task thereby
resolving and alleviating design, implementation, and administration and troubleshooting
responsibilities.
12.3. Mobile Channel Module

The mobile channel module is the front-end component or a component that is facing the
consumer to the Mobile payment services technologies provided by Yetim. These Mobile
payment channel technologies can be categorized into two environments of Yetim
implementation:
Server-Side Technologies
Server-side technologies are those applications built on a server, away from the consumers SIM
or Mobile handset, it this context at the Yetim Data Center infrastructure. Among many of these
technologies the initial implementations of server-side technologies would include SMS, IVR,
USSD2 and WAP gateways application softwares.
Client-Side Technologies
Client-side technologies are those applications, solutions and service offerings built or
embedded on a consumer SIM or mobile handset. The examples of Client Side technologies are
36
built on most of the handsets include, SMS, USSD, Voice, and WAP. And also the client side
technologies that can be embedded or used as application platform softwares include S@T and
J2ME (JAVA).
Yetim ePayment services provide a multi-channel gateway solution which includes the following
channels for the service deployment:
12.3.1.
SMS (Short Message Service) Gateway
SMS is a vital component on the implementation of Yetim e-Payment system, as it is deployed as

a mechanism of confirmation for transactions made by the customers. It will also be used for a
financial transaction channels with a limitation to avoid any potential risks. While SMS can also
be used as a main transaction method as used in other implementations, due to its security
issues involved on the service, it is decided only to be used for confirmation mechanisms and for
a limited amount of transactions.
The SMS processing computer applications runs on Yetim corporate data center servers that are
connected to the SMS network through specialized connectivity technologies to the ETC SMS
Center. These servers will be assigned short numbers instead of the traditional 10-digits mobile
numbers, upon a request from ETC. These numbers, also known as short codes are usually 4 to 6
digits long. For Yetim implementation of the SMS server a short code number 511 or 0511 is
selected, and it will be proposed to ETC for its availability and implementation.
12.3.2.
IVR (Interactive Voice Response) Gateway
Interactive Voice Response (IVR) is one of the most widely implemented, cost-effective, and
useful technologies around. For example, IVR functionality is used in applications for obtaining
movie schedules, bank transfers, plane ticket reservations, and prescription refills; and even for
tele-voting in TV Shows. Most businesses today use some form of IVR system.
IVR has become ubiquitous, with new applications being developed every day. Independent
software vendors (ISVs) and system integrators need the right tools to develop these
applications. Choosing the right hardware platform (media board) is essential, resulting in
reduced costs, faster time to market, and more satisfied customers.
As IVR is the most adaptable and easy to use telephone service, it is selected as a critical
component for Yetim operation understanding the technology orientation of use by most
37
customers of Ethiopia and rural areas where its simplicity makes it a best case for the
deployment of the service.
The IVR implementation on Yetim Architecture is based on a Degium SwitchVox solution that is
capable of handling 75 concurrent calls at the initial deployment and an ability to grow as the
operation of the company escalated. In addition to the implementation of the IVR based
payment transactions usage, the IVR voice system will be used as a landing point for customer
who requires support and consultancy on the operation from the customer contact center. The
customer contact center will be equipped with a full fledged Customer Relation Management
application software platform that will be attended by pre-recorded voice instructions for
mostly requested support inquires of the service.
12.3.3.
USSD
Gateway
(Unstructured
Supplementary
Service
Data)
In its simplest definition, USSD is a menu driven form of SMS where a customer would receive a
text menu on their phone as opposed to a string of words. USSD is a data bearer channel in the
GSM network. Like SMS, it transports small messages of up to 160 characters between the
mobile handset and the network. Unlike SMS, which is store and forward, USSD is session
based and can provide an interactive dialog between the user and a certain set of applications.
In other words, both sides of the dialogue happen during a session whereas an SMS based
interaction is broken into each segment of communication between the client and the service.
USSD1 only allows one way communication to the network, USSD2 allows two way
communications between the user and the network. With USSD1, the interaction between the
user and the service would be broken into each communication segment, much like SMS. With
USSD2 it would be held in the same session and allow for a flowing conversation between the
user and the service. This is similar to e-mail and instant messaging, e-mail waits for the
recipient to read and respond while as instant messaging allows for immediate dialogue.
USSD is one of the components of Yetim payment service implementation. However, as to the
preparation of this document the service is still not available from the sole service provider of
the country ETC. Although USSD have been used for balance request of pre-paid mobile user,
the status of the service is yet to be confirmed for availability from the mobile network operator
of the country, ETC.
USSD is as standard a feature as SMS and is available in an estimated 95% of handsets today.
And it requires no pre-configuration on the consumers SIM or handset and is already built into
most GSM networks.
38
12.3.4.
WAP (Wireless Application Protocol)
WAP is best described as the internet on a mobile phone. WAP is an open international standard
for applications that use wireless communication. Its principal application is to enable access to
the Internet from a mobile phone or PDA. A WAP browser provides all of the basic services of a
computer based web browser but is simplified to operate within the restrictions of a mobile
phone. WAP is now the protocol used for the majority of the world's mobile internet sites,
known as WAP sites. Mobile internet sites, or WAP sites, are websites written in, or dynamically
converted to, WML (Wireless Mark-up Language) and accessed via the WAP browser.20
WAP or mobile internet banking offers a consumer a similar experience to that of internet
banking. The consumer would browse to a mobile internet site by accessing the WAP browser
on their mobile phone and entering the website address.
The actual banking application resides at the bank and is secured and monitored in the same
way as an internet banking website. The mobile phone and bearer (GPRS) is used to display or
transmit the data between the consumer and the bank.
A consumers handset would need to be capable (functionality developed/loaded by the
handset manufacturer), and have the right configuration (provided by the MNO), in order to
support WAP Banking.
Most Mobile Network Operators often segment this functionality to post-paid customers only.
In Ethiopian scenario it is available on both pre-paid and post-paid SIM users. Hence, Yetim ePayment solution also includes this functionality as one of the service as it is available in the
current implementation of the MNO, ETC. Though its targeted use customers are small based as
it requires some technology orientation of the user/customer, the customer base is assumed to
grow as the technology adaptation of the country grow.
12.3.5.
POS (Point of Sales)
Point of sales (POS) is a key component of making available the mobile service that will be
provided by Yetim to rural and remote Ethiopia where most of the target customer is located.
The POS device selected is designed with a duel GSM/GPRS module for communication
redundancy and battery driven to ensure optimal uptime for transactions. The Device also
supports a camera, 2D barcode scanner and a Biometric fingerprint reader, these futures are
ideal for client registration and will be used by agents.
39
The POS solution supports multi-applications allowing for Yetim P2P application to coexist with
a Visa/MasterCard card processing application. The solution is taken a step further by allowing
for SIM based money transfer systems to reside on the same terminal, allowing money to be
moved between these schemes to the P2P solution.
Initial Implementation of Yetim ePayment service will include at least two types of POS
terminals that will be made available to the Agents and Merchants under a special policy and
use requirement that need to be fulfilled upon request and signing of contractual agreement
with Yetim.
12.4. Internet and WAN (Wide Area Network) Connection

Physically, the outside network often begins with a WAN connection to the Internet. The
physical characteristics of the currently provided service for the internet by ETC that are suitable
for Yetim, are broadband Digital Subscriber Line (DSL), Fiber Optics and Fixed Wireless Local
Loop Connection to ETC networks. However, incorporation of other future connectivity
solutions that will be implemented by ETC will also be considered as soon us the confirmation of
the service availability is acquired from ETC. Point-to-Multipoint WAN connections will be used
at the Yetim data center with enough capacity to handle all transaction requests that comes
from agents and institutes that are connected through the secure leased lines from ETC. In
addition to the VPN infrastructure that is implemented through MPLS/VPN cloud in the ETC
infrastructure, high end agents and affiliate institutes will be obligated to use a VPN tunnel from
their system to Yteim data centre to enhance the security.
Yetim Data Center will be available to the World Wide Web trough a dedicated 3Mbps
redundant links acquired from ETC internet Connection. With the incorporated web service the
e-Payment solution can also be accessed through any standard web browser secured by an SSL
certificate supplied from the Yetim web servers.
The Web service include a Web Portal that will also be accessed by the Agents and customer
Banks with a registration on the Yetim Access servers after authentication with a credentials. For
Web accesses through an Internet or a Wide Area network to an Agent Yetim Portal, it is
designed to make necessary a use of VPN client on the user side with a pre-defined security
protocol and certifications that will be made available during the operation.
40
12.5. Customer Contact Center (Call Center)

Customers are becoming increasingly sophisticated and demanding in their expectations of
organizations ability to provide higher levels of responsiveness, dependability, and convenience.
In many financial sector companies, call centers are at the forefrontserving as the primary
interface between the bank and its customersclearly positioning them as a vital part of the
larger organizational customer relationship management (CRM) strategy.
Traditionally, call centers have been viewed as back-office functionscost centers that serve no
purpose other than to receive customer inquiries. Today, with the proliferations of new
customer interaction capabilities and channels, call centers have become the logical centerpiece
for banking and financial sector organizations to carry out many mission-critical activities.
With this regard, one of the strategies taken by Yetim e-Payment service deployment is to
implement a robust call center that will make the services available to customers, anytime,
anyplace, regardless of how the customer chooses to access the services whenever it require a
support on operation, use and guidance of the services provided.
Hence, the initial deployment of Yetim Call Center will include a 24/7 support service that will be
handled with 10 dedicated call center attendants working at a time and provide the support
service requests through a well developed and adaptable procedures that are designed to
decrease the period required for the responses that are generated by customer.
Figure 14: Yetim ePayment Service Call Center Connection Schematic
An IP based Voice solution, from a leading open source based Voice Call Manager manufacturer
is selected in the design for this purpose. The solution, Degium SwitchVox, is a product that is
capable of scaling as the demand grows and industry tested on similar setups for Voice solutions
for call centers.
41
As for the Customer Relation Management (CRM) application that will be used it is vital to
select an application that is catered to the use case. With this regard, Yetim deployment will
incorporate CRM application software that can be easily integrated to the Voice call manager
solution selected. CRM program, coupled with a central toll-free number for customer support,
handles inquiries from both domestic and international customers.
12.6. Security Considerations of Yetim Network Infrastructure

The services that Yetim is providing should be built on a bullet proof and secured data network
infrastructure. Security, from the network infrastructure aspect, should be considered from all
aspects of the solution provision starting from the data use access policy to data transaction and
up to Physical access of the network. As Yetim service incorporate all the components that are
required for an e-payment system such as, Data repositories, data processing and clients that
are using different telecommunication services and channels, the security consideration should
cover all these components and all aspects of the operations itself.
Implementing security on infrastructure without having a security policy (either explicitly
defined or at least implied) represents at best haphazard approach to addressing network
security issues. The security policy of Yetim will be in writing, with input into the policy coming
from the groups of stakeholders that Yetim is dealing with. These stake holders include the
Company itself, ETC, the Company Users, the Company customers and all other parties that will
be interfaced or connected to the system.
Security policy Yetim is planning to develop for the payment service IT infrastructure will define
the security goals that the company aspires to with respect to its computer network or, in a
broader sense of its all information and technology assets. This definition of security goals
creates a framework for the full development of a security policy by facilitating the following:
Identification of assets to be protected
Delineation of threats against the protected assets
Review of the available responsesthat is, security solutionsto counter the perceived
threats
Creation of rules that users are obliged to follow with respect to the utilization of the
protected internal assists and services
Development of an action plan in the event of a security breach
42
Identification of a baseline against which compliance with security procedures can be

measured and monitored on an ongoing basis
Identification of trigger mechanisms for updating and reviewing the policy
Hence, with the security policy of Yetim on hand, Security will be implemented and will be given
a major consideration on the infrastructure to all services and network assets involved. With
this regard the following areas explain all the areas where security is very critical and where due
consideration given.
12.6.1.
Security aspects of SMS use
SMS banking is deemed to be the least secure of the mobile bearer channels. This is due to the
number of points that the SMS data is available to others in a clear or unencrypted format. A
consumer would initiate a transaction by sending an SMS to the bank using the banks SMS
short code as a terminating address. The SMS would be automatically stored on the handset
and be available to anyone that looks at the consumers phone. The SMS would then pass
through the encrypted GSM/GPRS/CDMA communication channel, through the base stations
and terminate at the mobile network operator, where it is typically stored unencrypted. The
MNO may at this point pass the message onto the banks wireless application processor, SMS
gateway, or mobile banking processor (which may be a third party), where it is stored either
encrypted or unencrypted. The third party would then pass the message to the financial service
provider, like Yetim, across an encrypted fixed line where it is typically stored in a secured
environment.
Due to these aspects of security issues, SMS service, for payment transaction, will not be
deployed as a main transaction platform for large amount transfers. However it is used as a
payment transaction channel for small amounts which encompasses assumed to be about 50%
percent of the total transaction value that will be processed by Yetim. The security mechanisms
that will be deployed on the SMS channels is mainly a process and procedural control type.
These include the following schemes:
43
Limiting daily transaction amounts
Limiting Maximum transaction amounts
Limiting the number of transactions per day for a single SMS user
Educating and providing orientations of security treats to the SMS customers.

Security of the IVR Service
12.6.2.
Security aspects of IVR channel
IVR, being a voice call, is protected by both the encrypted GSM communication layer as well as
the GSM protection of the subscriber identity of the consumer and it is carried across the
mobile network or a fixed line network to the Yetim IVR Server. Only at this point are the entries
that the consumer has keyed into their phone, stored. As this is on the Yetim infrastructure the
IVR calls are terminated, the security can be reinforced by comparing the Dialer Number and
with PINs that are stored in a secure Data Center Environment in the Yetim Infrastructure.
All IVR sessions will be recorded including the callers phone number, the sequence of
transactions made by a customer. Pin or authentication data will not be logged as to avoid the
threats that are caused by a customer data accessed by unauthorized user or system. Hence IVR,
due to its simplicity of use, for the Ethiopian market, is been selected as an initial financial
transaction channel to be used while the payment confirmation will be sent by SMS.
12.6.3.
Security of WAP Service
WAP allows for a GSM/GPRS session to be opened between the handset web browser and the
web application at the Yetim Data Center. This session is protected once again by the encrypted
GSM communication layer and then can be further protected by encryption of the actual Yetim
e-Payment service website that is being accessed. This makes WAP banking open to similar
threats as internet banking.
44
For Yetim implementation, WAP service will be deployed for all the customers with ability to
perform a web browsing activities on their mobile handset. As to the service coverage it is not
assumed to hold a large customer base at the initial stage. However, as to its security Yetim will
make available this service as to its commissioning phase.
12.6.4.
Internet Security
Physically, the outside network often begins with a WAN connection to the Internet. The
physical characteristics of the currently provided service for the internet by ETC are broadband
DSL connectivity through a Wireless/Cable Connection to ETC networks.
For Yetim Network
infrastructures, TLS/SSL tunnel will be mandatory so that entire session is encrypted from any
internet browser or customer mobile device to the host system server. This technique might still
leaves the data exposed in the web server. Therefore, end-to-end application-based encryption
is still necessary.
For this purpose, Yetim implementation, deploy the use of public key cryptography for
establishing security platforms and authentication solutions.
12.6.5.
Security aspects of Agents and connections from
institutes like Banks and MFIs
Yetim payment services can be and will be accessed from Branches, and customer agencies like
other banks through a WAN connection using a secured dedicated point-to-point leased lines
from the ETC. These agencies, like microfinance institutes, and other affiliate banks will need to
have a private line establishment to connect to the WAN service. As to secure these channels
from treats like eavesdropping and intrusion, a secure VPN will be used in addition to the
MPLS/VPN service security provide by ETC point-to-point leased lines. The VPN will be
terminated at a VPN server, in Yetim data Center and a VPN client need to be installed on
customer sites to secure the connection and to have an access to the services provided by Yetim
through WAN connections.
45
12.6.6.
Data Center Security
As to any Financial Service provider company network infrastructure the Data Center need to be
secured starting from the physical access aspect to the application level of communication of
the system. Like wise, Yetim Data Center is a repository of very critical data that includes user
accounts and balances of financial kind. This will make the Data center, a very critical asset that
should be secured from all aspects of treats.
To accommodate the physical security requirement, Security cameras will be used to secure
physical access to the Data Center servers, network devices and other equipments. The cameras
will be plunged to a Digital Video Recorder with a capability of long period of recording and
storing of Video data for future reference.
Access controls will be used to secure the server rooms for authorization and accounting
purposes. Authentication, authorization and Accounting softwares will be implemented with
customizable detailed reports of use of day to day activity of the system as well as to back trace
previous activities of malicious nature and unauthorized system access. System alerts, that will
also be implemented with applications, like Access Control Servers, would provide proactive
monitoring and alerts to the system administrators that will operate 24/7.
For Data Security, Industry tested implementation and standard of security will be used on all
the devices, servers and network assets that will be deployed on the system.
12.6.7.
User Security
Various tutorial technical are designed for the clients accessing the system, as most security
threats and risks are residing on the user/client side of the access. The tutorials include various
instructions that are designed in a manner should be readable and understandable for all the
community users. The delivery methods include direct customer tutoring on Yetim training
centers, Written Pamphlets and flyers and through Internet Web pages and email notifications
46
Customer Education is a key component in securing the mobile ePayment infrastructure that is
susceptible to various threats caused by ever emerging techniques of data theft. Also as for
most security case studies, most threats can be addressed by basic education of users. This basic
education to the consumer of mobile e- financial services will be conducted in the following
ways:
-
Customers should be advised to use different PINs for different online services.
Instructions should be provided to customers on how to configure their mobile devices

to access mobile banking and payment applications in a safe manner.
Customers should be advised as to the appropriate dispute handling, reporting

procedures, and the expected time for resolution of complaints.
13.
Risk Management
While existing general business risk management principles remain applicable to electronic
payment service activities, such principles must be tailored, adapted and, in some cases,
expanded to address the specific risk management challenges existed on systems and services
like Yetim service provisioning.
Electronic payment services under bank-led model entails two major categories of risks; risks
related to the customer usage of service and risks related to the technology involved on the
service provisioning. Yetim will give a special attention to these risks.
Rule Based Risk management
PIN based
Each user of Yetim will be provided with a four digit personal identification number (PIN)
upon initial registration on the system. Users are therefore required to use this number
whenever they need to make a transaction. They have also the option to change their
PIN at any time in case they have a doubt that it is seen by anyone.
47
Two channels
The customer will make transactions following voice instructions of the IVR technology.
This avoids the risk associated with sending the PIN on clear text over SMS. On the other
hand the customer will receive SMS confirmation of the transaction which will serve as a
controlling mechanism in addition to being an electronic document of the user
evidencing the transaction.
Lost or changed numbers
As the call center will be available 24X7 the customer can order blocking of his/her emoney account while losing or changing his SIM.
Transaction limit
The scheme is basically meant for the unbanked and mainly required to handle small
value transactions. Hence, to minimize risk of loss, single transaction as well as daily
limits will be set in consultation with the interested financial institution.
Legal documentation
Customers will fill applications for the service with relevant details of their identification
which will also have the major terms and conditions governing the use of e-money. Upon
signing the application the customer is simultaneously confirming his/her agreement
with the terms of conditions specified.
Transactions of purchasing e-money and withdrawing out of it will also be supported by
signed forms besides the electronic documentation of SMS. Transfer of funds between
two Yetim users will be supported by the SMS text message. In all cases the IVR platform
also records each transaction initiated by customers.
Fraud Monitoring
The system will have a fraud monitoring component which provides alerts of suspected
transactions for further scrutiny. Alerts will be generated based on predefined rules on
the system which could be specified in a way to identify abnormal transaction patterns
so that suspected transactions will be subject to investigation.
48
Technology Based Risk management
The risk aspects of the technology can be sought from the point of view that includes
relevant components the system incorporate. These components are the MNO network,
the datacenter and network infrastructure, and individual user or customer. The risk
management aspects of the technology will be described as the following:
The MNO Network
Most service provided by the mobile communication takes place over the MNO
networks. MNO networks usually have built-in mechanisms to provide security like
mobile station authentication and data encryption. Though it's not easy for anyone with
malicious intent to crack into the MNO network and the risk should also need to be
considered on Yetim implementation, as it would not be enough for a financial
institution to provide mobile banking services relying on de-facto GSM like protocol
security. The risk involved on this component includes Physical or logical access to
Mobile Network Operator (MNO) facilities by MNO's disgruntled employees or any
unauthorized person.
To avoid these risks is for Yetim to recommend and request some additional services and
facilities to be implemented for the services deployed by Yetim. These include:
Physical Security of MNO's Facilities
Physical premises of MNO's like Mobile Switching Centre (MSC) and Yetim data
centers access should be properly managed. Proper access control and
monitoring mechanisms should be in place. Access of employees on leave or
those resigned from service should be immediately stopped. Similarly logs
should be reviewed to assess any unauthorized access.
Availability of Services
MNO's and Yetim must have proper technology infrastructure backup, disaster
recovery plan and technical security infrastructure in place to ensure timely
services availability to all clients.
Yetim ePayment Datacenter Risk Management
The risks available on the Data center are the loss of data and network availability that
will cause the system unresponsive and un-operational.
49
To avoid this risk the setup of devices and applications is replicated to avoid the loss of
system access due to device or application failure. As for the Data, tape backup of user
and account information will be used in addition to various Disk RAID mechanisms that
will be set on Server. The backup data on a Tape will be stored on remote and secure
location for backup in case of data loss or data corruption of critical database
repositories of the system.
Power failure and fluctuations is a major issue in Ethiopian IT context. To avoid the risk of
power failures, Multiple Uninterruptible Power Supply devices, with long period of
operation, is used for all major network devices and applications. As a second line of
defense Generators will be used. Power supply of devices are usually susceptible to
failures, as to avoid the risk of system failure due to the power supply failures of major
infrastructure equipments, a dual power supply configuration will be implemented.
Frequent studies show that components of network equipments and servers fail due to
an extreme heat that will be generated due to the very high work processing load of the
devices. To avoid this risk the network devices are fitted with an adequate cooling
system to reduce the heating. For Yetim data Center devices, a dedicated Air
Conditioning Units will be used to cool the Data Center to an acceptable temperature.
As to avoid the total loss of the Data Center that might be caused by natural disaster like
incidents Yetim will implement a Disaster recovery site on a remote location. The site will
be used as a second functional operation Data Center, identical to the Main data center,
with a strip down setup to reduce the cost, but with all functionality required for the
deployed services. During the full operation of the main Data center, the disaster
recovery site will also be used as a Hot standby backup site.
Networking and infrastructure capacity and Risk Management
The networking part is the most susceptible from risk point of view. As to In addition to
the redundant configuration of networking devices that will be in the initial setup of the
system, identical devices will also be hold in stock to avoid the delays that might be
caused by the supply chain and purchasing processes .
The possibility of rapid adoption of Yetim Service simply makes it more important to
adequately consider the risk factors involved on the network and communication aspect.
These factors are included In two areas the capacity of Yetim own network system and
the congestion on the service provider networks.
50
The ability of the Yetim to cope with the arrival of large numbers of financial transactions
and services, at its computer systems is very critical. to ensure that the service provider
and banking channel has sufficient capacity to handle the customer interaction and
transaction load. There will still be many more voice calls, SMS and Data traffic that load
the mobile networks. Transactions are usually a very small fraction of the overall mobile
network load. (a SMS represents the equivalent of about 0.1 seconds of speech on a
GSM network).
As to avoid the overload that will be raised due to service demands, Yetim
implementation is designed with a capability of scaling the system capacity using various
proactive monitoring and auditing tools on its network. Using this reports generated
from the tools, current loads and future capacities of the system will be identified for
equipments and individual services that might create the bottleneck to data
transactions. For such issues Yetim strategies to use extra large system sizing, with a full
consideration not to affect budget issues, as to cope with unprecedented overload of the
system before it happens. The strategy will also make sure that service provided by Yetim
will always be in relative to the number of customer subscription and number of
transactions done per second.
Redundancy and Risk of losing availability
Financial Enterprise classifies their network operations based on how critical they are to
its business operations. The measures you take to ensure availability of a specific server
or network device will depend on its importance to the overall operation of the business.
As Yetim provide a service that is entirely dependent on the technology and connectivity
solutions, its paramount importance to implement the system on a redundant platform
with a very fast recovery potential of faults on operations. With this regard, Yetim Design
of the network infrastructure is with a consideration to avoid single point of failures an
all components of the setup. Hence the most areas of the infrastructure is given due
consideration to avoid failures caused by unexpected reasons such as human errors.
When serious failures occur, the use of dual devices and applications can effectively
reduce the adverse effects system downtime that causes service interruptions. After a
failure, discovery protocols help end stations choose new paths with which to
communicate across the network. If each network connected to the failed device has an
alternative path out of the local area, complete connectivity will still be possible.
51
Risk of Data Loss and Data Encryption
Data encryption from the customer equipment to Yetim service host servers is a
paramount importance to avoid risks introduced in the transaction channels. As to the
Mobile payment implementation that includes SMS and IVR, this mechanism can not be
implemented as there is no viable technology that can be implemented to do so. And
the technologies by themselves are made for unencrypted and clear text
communications.
As to the to the Yetim infrastructure implementation, all server to server communication
will use SSL links and Certificates these are technologies that are equipped with
encryption techniques to secure communication channels between web server and web
client, through the web browser. As for the Yetim services like Internet, WAP and VPN
portal, the main communication interface is the Web browser or an http application
interface, the browser secures all the data sent and received through a SSL link (secure
tunnel or pipe) that passes through the mobile or fixed line network all the way to the
WAP or HTTPS Servers hosted by Yetim. These servers in turn communicate over a SSL
secured links to the Yetim internal servers. The end-to-end security is thus guaranteed
from the application on the handset or computer browsers through to the Yetim
systems. The SSL link security is explicit running end-to-end from the handset through to
the WAP or HTTPS Servers. Thus any insecurities that may exist in any of; the radio link
between the mobile handset and the BTS, the path through the mobile network or
through the core telephony network are bypassed.
Risk of Individual Users
Individual customers risks are the union of the business risks and the individual risks. A
business risk generally affecting the business and therefore all individuals as well as the
risks that the individuals are exposed to due to their specific use of the channel.
The risks introduced by the individual are how the individual uses the service. As such
the countermeasures usually involve user education. The risk can and will be minimized
by disseminating appropriate tutorial materials on secure use of the service upon signing
of Registration forms through various consumer channels.
52
14.
Conclusion and Recommendation

The single most important step in building a successful mobile payment system is to set
the incentives for all stakeholders. Without this, there will be no progress. Each of the
participants, furthermore, must accept certain fundamentals and step up as needed for
the good of the entire operations that provide the service that will be provided.
Mobile operators like ETC must consider the mobile payment system in the context of
new ways to open up revenue streams, especially from monthly m-payment subscription
charges or per transaction fees. Operators must also take full advantage of the positive
side effect of introducing and embedding the mobile phone and their value added
services even deeper into the life of the subscribers - a significant motivator as observed
in success stories of some African countries like Kenya (MPESA).
With this regard we have explained in the previous topics and proposed that the idea of
Yetim is technically achievable, financially feasible and economically viable. Considering
the current fast developments in the financial sector of the country, coupled with the
accelerated growth in mobile subscribers, it is appropriate to go fast with
implementation of this innovative concept within the shortest possible time.
One of the core beneficiaries and service provider of Yetim is ETC, as a part of the 5 year
plan that is stipulated by the Government, the corporation will play a crucial role in
facilitating and supporting a technologies, that are provided by third party service
providers like Yetim, that facilitate the adaptation of electronic payment services and
efficient network use by the customers/subscribers of the corporation.
With this understanding of the government initiative on growth based on ICT
implementation and also understanding the benefits that are gained through services
provided by companies like Yetim, We are looking forward on the support and
technology solution and services that are critically needed to be provided by the
government institutes, like ETC, on achieving the proposed target.
53
15.
Annex I: Financial Forecast and Cash Flow
Description
Year 2
Year 3
Year 4
Year 5
7,000,000
9,100,000
11,830,000
15,379,000
19,992,700
10%
15%
20%
25%
30%
700,000
1,365,000
2,366,000
3,844,750
5,997,810
12
12
12
12
12
24
24
24
24
24
Transfer
24
24
24
24
24
Balance inquiry
24
24
24
24
24
300
300
300
300
300
8,400,000
16,380,000
28,392,000
46,137,000
71,973,720
16,800,000
32,760,000
56,784,000
92,274,000
143,947,440
Transfer
16,800,000
32,760,000
56,784,000
92,274,000
143,947,440
Balance inquiry
16,800,000
32,760,000
56,784,000
92,274,000
143,947,440
1,400,000
2,730,000
4,732,000
7,689,500
11,995,620
210,000,000
409,500,00
0
709,800,00
0
1,153,425,00
0
1,799,343,00
0
1.50
1.50
1.50
1.50
1.50
Transfer
1.75
1.75
1.75
1.75
1.75
Balance inquiry
0.50
0.50
0.50
0.50
0.50
PIN Change
0.50
0.50
0.50
0.50
0.50
Number of mobile subscribers

Proportion of Yetim users
Number of Yetim users
Year 1
Average number (value) of

transaction per user per year
PIN Change
Top-up (in Birr)
Total number of transaction per
year
PIN Change
Top-up (in Birr)

Price per transaction
54
Top-up (%)
8%
8%
8%
8%
8%
25,200,000
49,140,000
85,176,000
138,411,000
215,921,160
Transfer
29,400,000
57,330,000
99,372,000
161,479,500
251,908,020
8,400,000
16,380,000
28,392,000
46,137,000
71,973,720
700,000
1,365,000
2,366,000
3,844,750
5,997,810
16,800,000
32,760,000
56,784,000
92,274,000
143,947,440
80,500,000
156,975,00
0
272,090,00
0
442,146,250
689,748,150
924,000
1,801,800
3,123,120
5,075,070
7,917,109
1,848,000
3,603,600
6,246,240
10,150,140
15,834,218
3,696,000
7,207,200
12,492,480
20,300,280
31,668,437
1,848,000
3,603,600
6,246,240
10,150,140
15,834,218
154,000
300,300
520,520
845,845
1,319,518
924,000
1,801,800
3,123,120
5,075,070
7,917,109
9,394,000
18,318,300
31,751,720
51,596,545
80,490,610
Revenue in Birr
Balance inquiry
PIN Change
Top-up
Total revenue
Cost and expenses

SMS text charges
Deposit (one SMS per
transaction)
Withdrawal (One SMS per
transaction)
Transfer (two SMS per
transaction)
Balance inquiry (One SMS per
transaction)
PIN Change (One SMS per
transaction)
Top-up (One SMS per
transaction)
Total SMS charges
Toll free payment (10 cents per
transaction)
Agent commission (30% of
revenue)
6,860,000
13,377,000
23,186,800
37,678,550
58,778,538
27,930,000
54,463,500
94,403,400
153,405,525
239,312,619
Marketing and promotion
16,100,000
15,697,500
19,046,300
22,107,313
34,487,408
Salaries and benefits
1,200,000
1,440,000
1,728,000
2,073,600
2,488,320
Software maintenance
2,415,000
4,709,250
8,162,700
13,264,388
20,692,445
Hardware maintenance
Other Telecom charges including
broadband connection
1,120,000
1,120,000
1,120,000
1,120,000
1,120,000
240,000
288,000
345,600
414,720
497,664
55
Rent expense
900,000
990,000
1,089,000
1,197,900
1,317,690
Depreciation and amortization
4,796,000
4,796,000
4,796,000
4,796,000
4,796,000
Miscellaneous expenses
1,610,000
3,139,500
5,441,800
8,842,925
13,794,963
Total costs and expenses
72,565,000
118,339,05
0
191,071,32
0
296,497,465
457,776,256
Net income - Before tax
7,935,000
38,635,950
81,018,680
145,648,785
231,971,894
Income tax
2,380,500
11,590,785
24,305,604
43,694,636
69,591,568
Net income after tax
5,554,500
27,045,165
56,713,076
101,954,150
162,380,326
Net Income
5,554,500
27,045,165
56,713,076
101,954,150
162,380,326
Add: Depreciation
4,796,000
4,796,000
4,796,000
4,796,000
4,796,000
Cash flow from operations
10,350,500
31,841,165
61,509,076
106,750,150
167,176,326
Total transaction related payment

to ETC
16,254,000
31,695,300
54,938,520
89,275,095
139,269,148
20.19%
20.19%
20.19%
20.19%
20.19%
Cash flow forecast
Proportion against total revenue
Table 2: Financial Forecast and Cash Flow in Ethiopian Birr
56
16. Annex II: ETC Opportunity Cost Saving by Using Yetim Top-up
service
Opportunity Cost Saving to ETC
on Using Yetim Top up Service
for Mobile Air Time
recharge(Birr)
ETC Cost of Scratch Card
Number of Scratch Cards Used
Per Year Per User(Minimum of
25Birr Card)
ETC Prepaid users that use
Yetim Top-up(95% of Yetim
Subscribers)
Number of Scratch Cards
Avoided by Yetim Service
ETC Cost saving per Top-UP
ETC Cost saving per Top-UP of
Scratch Card Management
including(Logistics, Distribution,
Storage and Risk Factors)
Total ETC Cost Saving
1.50
1.50
1.50
1.50
1.50
12
12
12
12
12
665,000
1,197,000
1,915,200
2,872,800
4,136,832
7,980,000
14,364,000
22,982,400
34,473,600
49,641,984
11,970,000
21,546,000
34,473,600
51,710,400
74,462,976
598,500
1,077,300
1,723,680
2,585,520
3,723,149
12,568,500
22,623,300
36,197,280
54,295,920
78,186,125
Table 3: ETC Opportunity Cost Saving on Using Yetim Top-up Service
57
17.
Annex III: Yetim Initial Investment Outlay
Description
cost in Birr
Server Hardware
3,500,000
Application Software
1,400,000
Operating systems and DB
700,000
Networking
1,400,000
Data center Equipments & Arrangement
2,800,000
Disaster recovery (redundancy)
2,100,000
Software and solution integration
1,260,000
Hardware configuration
420,000
Pre-opening expenses
2,100,000
Office furniture and equipment
2,800,000
Vehicle (5)
3,500,000
Miscellaneous
2,000,000
Total long term investment
23,980,000
Annual expense
Months coverage
Working capital
Total SMS charges
5,368,000
1,342,000
Toll free payment
3,920,000
980,000
Marketing and promotion
9,200,000
2,300,000
Salaries and benefits
1,200,000
600,000
Software maintenance
1,380,000
345,000
Hardware maintenance
1,120,000
280,000
Rent expense
900,000
450,000
Miscellaneous expenses
920,000
12
920,000
Total working capital
Total investment
7,217,000
31,197,000
Table 4: Yetim ePayment Service plc Initial Investment Outlay
58
59

Yetim EPayment Service Proposal

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Yetim EPayment Service Proposal

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A Proposal for Content Provisioning

Platform of mobile financial service

Submitted by: Yetim ePayment Service

Yetim is an innovative e-money service which is

Yetim Company Profile and History........................................................................................... 3

Yetim: The Business Model .............................................................................................................. 9

Yetim: The Solution and the Service.......................................................................................... 9

The solution ....................................................................................................................... 10

The Service ......................................................................................................................... 11

Workflow for each type of service ...................................................................................... 12

Buying electronic money (for the first time)..................................................................... 12

Subsequent purchase of electronic money or cash deposit .............................................. 13

Pay e-money to merchants for goods or services purchased ............................................ 16

Airtime top-up ................................................................................................................ 18

Bill payment using e-money ............................................................................................ 18

Microfinance payments .................................................................................................. 18

Balance inquiry ............................................................................................................... 19

Methodology of managing content provisioning ................................................................. 21

Service users ...................................................................................................................... 22

Yetim Content marketing strategy .................................................................................................. 24

Yetim Content Provisioning and Interface ....................................................................................... 24

Content Language and Culture ....................................................................................................... 26

Price and Business Plan .................................................................................................................. 26

Yetim Price Scheme (Tariffs) for each service .......................................................................... 26

Yetim Business Plan for each service ....................................................................................... 27

Financial Proposal and Commercial offer.................................................................................... 29

Technical Capabilities ................................................................................................................. 30

12.1. The Mobile Network Operator (MNO) .................................................................................... 31

The Software Platform............................................................................................................ 33

The Server Hardware .............................................................................................................. 35

Interconnectivity Devices ....................................................................................................... 36

Mobile Channel Module ..................................................................................................... 36

SMS (Short Message Service) Gateway ................................................................................... 37

IVR (Interactive Voice Response) Gateway .............................................................................. 37

USSD (Unstructured Supplementary Service Data) Gateway ................................................... 38

WAP (Wireless Application Protocol) ...................................................................................... 39

POS (Point of Sales) ................................................................................................................ 39

Internet and WAN (Wide Area Network) Connection .......................................................... 40

Customer Contact Center (Call Center) ............................................................................... 41

Security Considerations of Yetim Network Infrastructure .................................................... 42

Security aspects of SMS use ................................................................................................... 43

Security aspects of IVR channel .............................................................................................. 44

Security of WAP Service.......................................................................................................... 44

Internet Security .................................................................................................................... 45

Data Center Security .............................................................................................................. 46

User Security .......................................................................................................................... 46

Risk Management ...................................................................................................................... 47

Conclusion and Recommendation .............................................................................................. 53

Annex I: Financial Forecast and Cash Flow ................................................................................. 54

Annex III: Yetim Initial Investment Outlay .................................................................................. 58

Figure 2: Yetim Organizational Structure

Figure 4: Process flow of transferring electronic money to a friend or family member

Figure 9: Yetim ePayment services Network infrastructure connection schematic

Figure 10: Yetim ePayment services Network infrastructure connection schematic

Figure 11: Yetim ePayment service Data Center Architecture

Figure 12: Yetim ePayment Service Logical Application Services Connectivity

Figure 13: Yetim ePayment Services application modules

Figure 14: Yetim ePayment Service Call Center Connection Schematic

Information Communication Technology

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Mobile Network Operator

Payment Card Industry

Know Your Customer

Short Message Service