Ethiopia has granted a mobile money transfer license to Safaricom, a Kenyan telecoms operator, marking the first time a foreign operator has received such a license in Ethiopia’s banking sector.
The Central Bank of Ethiopia announced the development, highlighting the growing collaboration between the two countries.
Safaricom Ethiopia, a consortium led by Safaricom and including Vodacom from South Africa and Sumimoto from Japan, was awarded the second mobile phone license in Ethiopia in 2021.
Since then, the operator has been progressively expanding its network in the country, which boasts a population of 120 million people.
The National Bank of Ethiopia (NBE) confirmed that it had issued the mobile money transfer services license to Safaricom’s subsidiary, Safaricom M-Pesa Mobile Financial Service Plc. This move signifies a significant milestone for foreign investors in Ethiopia.
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Prior to granting the license, the NBE made amendments to the national Payment Systems legislation, establishing a regulatory framework that allows foreign telecom operators to provide Mobile Financial Services (MFS) in Ethiopia. Safaricom Ethiopia plans to launch its mobile financial services in the second half of 2023.
Safaricom’s M-Pesa service has gained widespread popularity in Kenya, enabling users to send and receive money, pay bills, and make purchases, even without a bank account.
The company claims that M-Pesa is utilized by 51 million people across seven African countries and contributes almost 40% of its profits, according to its latest financial report.
The partnership between Safaricom and Ethiopia signifies a significant step toward expanding mobile money services in the country and enhancing financial inclusion for its citizens.
