Cooperative Bank of Oromia Takes AI-Powered Lending Into Islamic Finance

October 31, 2026 | By Semahegn Nigatu

Cooperative Bank of Oromia has extended its digital lending operations into Sharia-compliant financing, launching an artificial intelligence-powered platform designed to provide interest-free financial services to micro, small and medium-sized enterprises (MSMEs).

The platform, named Michu-Mizan, was developed in partnership with financial technology company Kifiya and was launched at the Sheraton Addis Hotel. It operates under the bank's Coopbank Alhuda interest-free banking division, using artificial intelligence (AI) and digital financial systems to facilitate access to financing for businesses seeking products compatible with Islamic financial principles.

The launch marks an expansion of the bank's existing Michu digital lending service, which has disbursed more than 70 billion birr in unsecured loans, according to Deribie Asfaw, the bank's chief executive officer.

Asfaw said the new platform was intended to address the financing constraints faced by business operators who lack access to financial products that align with their religious beliefs.

The platform introduces two financing products targeting different segments of the market. Michuu-Miizan Usra provides financing of up to 100,000 birr to support women's economic participation, while Michu-Miiaan Tajir offers eligible micro, small and medium-sized businesses up to 300,000 birr for working capital and business expansion.

Both products are designed to accommodate different business financing requirements while operating within Sharia principles.

Kifiya's chief executive officer, Munir Duri, said the platform would use AI-driven, data-based decision-making and the company's financial technology infrastructure to extend Sharia-compliant financing to businesses that have historically remained outside the formal financial system. He said the service would help such enterprises access financing and support their growth.

The introduction of Michu-Miizan adds a digital delivery channel to the bank's interest-free banking operations, at a time when financial institutions are expanding technology-based services to reach businesses with different financing requirements.

Source: FSX Business News