Ethiopian Banks and Logistics Firm ESL Clash Over Transfer Fees

Financial institutions in Ethiopia have expressed concerns over Ethiopian Shipping and Logistics (ESL)'s recent warning regarding transfer fees. ESL, a state-owned logistics company, believes some banks charge excessive fees for transactions to its Citibank account.

Banks are requesting negotiations to find a mutually agreeable resolution. ESL has acknowledged the concerns and remains open to discussions with banks seeking further dialogue.

Fee Dispute Details

ESL sent a letter to 24 domestic banks on February 14, expressing concerns over high transfer fees. The company warned these fees negatively impact its operations and market competitiveness.

ESL has requested banks limit service fees to 1% for USD transfers and 2.5% for birr transfers. Some banks have proposed alternative rates and requested further discussions.

Bank Response and Concerns

Banks have criticized ESL's unilateral demand, arguing for negotiations instead of a dictated rate cut. They contend operational costs justify their fees.

Bank leaders argue costs differ among institutions and dispute ESL's claim of fees reaching 11%. They suggest ESL address specific banks with exorbitant rates rather than generalizing.

ESL's Position

ESL manages at least USD 50 million in monthly international payments. The company emphasizes high bank fees have a substantial impact on its finances.

ESL is now contemplating direct discussions with banks following appeals from long-term partners. Negotiations are viewed as the most effective way to maintain the relationship between the banking sector and ESL.