Terms of Reference (TOR)

 The State of Digital Financial Services (DFSs) in Oromia: with specific focus on Smallholder Farmers, Pastoralists, Women and Urban SMEs

1.     Background

Gudina Tumsa Foundation (GTF) is a not-for-profit civil society organization registered with the Authority for Civil Societies Organizations (ACSO) with the mandate to operate at national level in Ethiopia. GTF was established by the family and friends of Reverend Gudina Tumsa with aim of carrying on his vision through rendering holistic service to the marginalized communities in Ethiopia. The foundation was formed in 1992 and started delivering development services in 1994. The foundation has implemented different projects in nine regional states of Ethiopia.

GTF envisions empowered communities that perceive themselves as capable human beings, equipped to actively engage in all aspects of human life. This is in line with the Reverend Gudina Tumsa’s own words, stated below:

“… an integral human development, where the spiritual and physical needs are seen together, is the only right approach to the development question in our society.”

GTF has developed and implemented different projects that promote the holistic development vision of the organization. The organization was formed to create a better world for those people who have been left behind and most vulnerable in our society to help them live with dignity and hope.

GTF engages in different thematic areas that are life-changing. Accordingly, the foundation engages in the following program areas:

• Women and child support services whereby education, healthcare, and other essential services are provided to marginalized women and children,
• Education program focusing on building schools, production materials and supplies, and teacher supports,
• Health, Water, and Environment program focusing on promotion of health services and prevention of disease, WaSH (water, sanitation, and hygiene), and environmental protection and conservation through planting trees, etc.
• Livelihood enhancement through different economic empowerment and job creation initiatives for women and youth.
• Policy Advocacy focuses on influencing Regional Decision Makers towards evidence-based, effective, and responsive policy formulation and implementation

ced the implementation of a project titled “Healthcare and Livelihood Improvement Advocacy Project in Oromia (HaLIAPO)” with the funding secured from the Gates Foundation (GF). The project is implemented in Oromia for 3 years from January 2024 to December 2026, in collaboration with the two regional states. GTF has signed a Memorandum of Understanding with the regional President’s Office of Oromia to guide the implementation of project activities in the region.

The Goal of the project is to contribute to the increased use of evidence and policy analysis by decision-makers, leading to the adoption of policies broadly favorable to agricultural productivity, healthcare and nutrition, financial inclusion, and women’s economic empowerment.

The project employed competent experts in project management, policy analysis, and data analysis who are working as a team. The activities of the project are enormous, and hence it requires external experts/consultants to undertake studies and research on identified topical issues. One of these thematic study areas to be outsourced is a Study on “The State of Digital Financial Services (DFSs) in Oromia: with specific focus on Smallholder Farmers, Pastoralists, Women and Urban SMEs.

2.     Introduction to the Assignment

DFSs are financial products and services, like payments, credit, savings, and insurance, delivered through digital channels such as mobile phones, the internet, and ATMs.

According to the National Bank of Ethiopia (NBE), active users of DFS in Oromia are 2.4 million, 2.7 million, 0.1 million, and 2.6 million for mobile money, mobile banking, internet banking, and debit card in 2023, respectively. Access to and usage of DFS in Oromia is far lower than the national average, and only about 10.3 % of the adult population have literacy about mobile money. There is a significant gender and urban-rural divide in accessing financial services, with vulnerable social groups such as smallholder farmers, the youth, and women, the poor, and small businesses being affected the most.

While the role of DFS in enhancing financial inclusion has been widely acknowledged, researches that examine how DFS effectively reaches the most vulnerable segment of the population in Oromia has not been conducted. Studies so far have focused on depicting the overall expansion and adoption of DFS at the country and regional levels without exploring the access and usage disparities among the different socio-economic groups within a region. Moreover, there is no study that explored the state of digital literacy, affordability, and regulatory challenges limiting DFS expansion to the low-income and rural communities in the region. This gap led to conducting an in-depth and context-specific study that examines the opportunities and challenges presented by DFS in promoting financial inclusion in Oromia.

Many rural people and low-income households remain outside the formal financial system, limiting their ability to engage fully in economic activities.  The digital divide, marked by unequal access to technology and varying levels of digital literacy, prevents certain groups from fully utilizing these services. Furthermore, weak regulatory frameworks raise issues related to the security, reliability, and sustainability of DFS, complicating efforts to achieve widespread economic inclusion. The core issue, therefore, is the persistent gap between the availability of DFS and the actual economic inclusion of disadvantaged groups in Oromia. Addressing this challenge requires a detailed understanding of the obstacles to DFS adoption and the factors that impact their effectiveness in promoting economic inclusion in the region.

Although digital financial solutions are prone to reach marginalized rural and the under-banked community in remote areas, and the future of banking service provision modality, digital solution often focuses on urban areas, where the traditional services have already existed.  Hence, conducting an in-depth study that identifies the factors contributing to the low access and utilization of the DFS in the rural areas of the region would help address the problem, thereby increasing the financial inclusion coverage of the region.

3.     Objectives

The general objective

The general objective is to assess the state of DFS and identify the barriers affecting the adoption and expansion of DFS in Oromia, focusing on smallholder farmers, (Agro) pastoralists and women, and SMEs in urban areas.

The specific objectives are to:

• assess the current state of the DFS in rural and urban Oromia.
• evaluate whether existing digital technologies meet smallholder farmers, (agro)pastoralists and women, and SMEs’ specific needs.
• identify the barriers that affect the adoption and use of DFS in rural and urban Oromia.
• Identify the willingness to adopt DSF by smallholder farmers, (Agro)pastoralists, women, and SMEs.
• Assess the relationship between DFS and financial inclusion in the region

4.     Scope of Work

The study will have the following scope: –

• The study covers both the rural and urban area of Oromia. In rural areas, it focuses on smallholder farmers, (agro)pastoralists, and rural women. While in urban areas, it focuses on SMEs.
• Identify the global and local DFS solutions implemented by financial institutions (such as banks and insurance) to provide financial services in Ethiopia; these include the financial products accessed and delivered through digital channels, i.e., the Internet, mobile phones (both smartphones and feature phones), ATMs, and point of sale (POS) terminals, and others.
• Assess the state of DFS in the region based on the three pillars: namely, Digital Infrastructure, Policy & Regulation, and Products & Innovation, in the light of ensuring financial inclusion.
• Assess the contribution of DFS to ensure financial inclusion in Oromia.
• Assess DFS in the light of the three internationally recognized dimensions of financial inclusion: access to financial services, usage of financial services, and quality of financial services.
• Identify the numerous technical, economic, and social challenges impeding digital transformation in the region.
• Assess the performance of DFS in the region based on the essential functions such as accepting deposits, providing loans, paying bills, offering transfer services, etc.
• Assess trend towards digitization, use of modern technologies, and Artificial Intelligence (AI) in financial institutions to simplify and facilitate access to the unbanked segment of the population;
• Assess DFS by its key features
  • Accessibility: DFS eliminates the need for physical branches, allowing users in remote areas to access services through their mobile devices.
  • Affordability: Many DFS providers offer low-cost services, reducing the financial burden on users.
  • User-Friendliness: The rise of intuitive mobile applications and platforms has made it easier for individuals with minimal financial literacy to navigate financial services.
  • Variety of Services: Beyond basic money transfers, DFS includes savings and investment accounts, microloans, insurance products, and payment solutions, catering to diverse financial needs.

5.     Methodology

The consultant has to provide a detailed study methodology and data sources which is appropriate to undertake the proposed study in its technical proposal. However, the study is expected to employ a mixed approach including quantitative, qualitative, and policy analysis.  Quantitative data will be collected from both primary and secondary sources, and demand and supply-side data. For collecting survey data, the consultant is expected to apply an appropriate sampling technique while selecting the sample zone, the woreda, and the kebele.

The study population is expected to comprise all adults capable of benefiting from financial services in Oromia. It is recommended to consider an age threshold of 15 and above, so that the data will be comparable with international definitions and reports. In order to strengthen the inference, the sample size has to be double the number of the sample size obtained using standard statistical sample size determination formula for finite populations. In effect, there will be three categories for which samples will be drawn for the survey, i.e., rural smallholder farmers, pastoralists, and urban SMEs.  From each category, make sure that women, the youth, and different religious groups are represented sufficiently.

The secondary data will be collected from the stakeholders, including the National Bank of Ethiopia (NBE), financial service providing institutions, Ethio-telecom, Safaricom, and other relevant stakeholders. The consultant has to collect time series data on DFS performances starting from the year DFS started operation in Oromia.

To complement the quantitative data, attempts should be made to collect qualitative information from identified key informants who represent key stakeholders.

6.     Deliverables:

• Inception report, which includes refined methodology and data collection tools
• Progress report presentation
• Draft study report
• Presentation of the research findings at the validation workshop.
• Final study
• Policy brief
• Final report to the GTF in both electronic and hard copies
• All collected raw data in soft copy, including recorded audio/videos, photographs, and other relevant materials.

7.     Required Qualifications

The Applicants must have a professional team composition comprising the following fields of specialization and minimum qualifications:

• Lead Consultant (Principal Investigator): PhD in Economics, Finance and Banking, Statistics, Business Management, or related fields with 7 years of proven research experience in Financial Inclusion, Digital Financial Service, and related areas.
• Data Manager: Master’s degree in Statistics or related field with 7 years of proven experience in quantitative research and data management
• Gender Expert: Master’s degree in Gender Studies or related field, with 7 years of proven research experience in gender analysis in financial services.
• Strong Research & Analytical Experience in Mixed-methods research (quantitative and qualitative).
• Proficiency in Afaan Oromo and English is mandatory

8.     Timeframe 

The assignment should be delivered within 60 days.

9.     Evaluation

• The technical proposal: 70%
• Financial proposal: 30%

10.  How to apply

Potential consultants or consulting firms should submit their detailed technical and financial proposals, including:

1. Detailed CVs and valid experiences
2. A copy of their renewed business license
3. A copy of their Taxpayer Identification Number (TIN)
4. A copy of their VAT Certificate

All application documents should be sent electronically to jobs@gtfound.org with the subject line “Proposal for the State of DFS in Oromia”.

Submission Deadline: 25 November 2025, 4:30 p.m.

 For more information, please contact us at the following address:

• Email: teshome.b@gtfound.org 
• Tel: +251969355555

 Important Notes

• Only shortlisted candidates will be contacted.
• GTF reserves the right to accept or reject any or all bids, in whole or in part, without providing any reason whatsoever.
• Late submissions will not be considered.