2023-05-12 11:49:17
This is the first mobile money transfer license granted to a foreign investor in Ethiopia. The country’s central bank gave the green light on May 11 to the mobile money activities of the Kenyan telecom operator Safaricom, the institution and the company announced.
Safaricom Ethiopia was awarded the second mobile telephony license in Ethiopia in 2021, alongside the incumbent and 100% public operator Ethio Telecom. The operator a gradually put its network into service since 2022, in the country of 120 million inhabitants.
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In a press release, the National Bank of Ethiopia (NBE) announces “to have today issued the license for mobile money transfer services to Safaricom M-Pesa Mobile Financial Service Plc”. This is a newly created subsidiary of Safaricom Ethiopia, a consortium led mainly by Safaricom and including in particular the South African operator Vodacom and the Japanese group Sumimoto.
“We strongly support the spread of digital payment systems as a substitute for cash transactions,” says the NBE, as Ethiopia announced last year its intention to open its banking sector to foreign players.
A very profitable mobile service
On the occasion of the launch of its services in Addis Ababa, in October 2022, Safaricom Ethiopia announced that it had reached an agreement with the Ethiopian government to obtain this “mobile money” license.
“Before issuing the licence, the NBE amended the national legislation on payment systems, to establish the necessary regulatory framework so that foreign telecom operators can provide mobile financial services [MFS] in Ethiopia,” Safaricom Ethiopia said in a statement. The company adds plans to launch its financial services via mobile in the second half of 2023.
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Safaricom’s M-Pesa service, widely used in Kenya in particular, allows users to send and receive money, pay bills or purchases, even without having a bank account. Safaricom claims it is used by 51 million people in seven African countries. In its latest financial report, Safaricom estimates that M-Pesa contributes almost 40% of its profits.
Ethio Telecom offers a mobile money transfer service in Ethiopia called Telebirr, named after the Ethiopian national currency, the birr.
(with AFP)
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