Ethiopia: Safaricom obtains the license to operate its M-Pesa mobile payment service
May 14th 2023
Seven months after the official launch of its activities in the country, the mobile operator Safaricom Ethiopia believes that it has gained visibility among local consumers. While it pursues an aggressive commercial campaign in voice and data, new services are in the making.
The telecommunications company Safaricom Ethiopia announced, this Thursday, May 11, the obtaining of its operating license for the mobile money service M-Pesa. In return, the operator paid $150 million to the National Bank of Ethiopia (NBE). Subscribers of the telecom operator will now be able to send and withdraw money, make payments from their mobile.
“ We are delighted that this is an important step after our entry into Ethiopia. We are thus able to provide essential financial services to the Ethiopian population. We look forward to launching and rolling out the service over the coming months ,” said Peter Ndegwa, Chief Executive Officer of Safaricom PLC.
Safaricom Ethiopia officially launched its commercial activities in Ethiopia on October 6, 2022. The company which wanted to combine a mobile finance offer – in which its parent company has acquired some experience and international renown – with its voice and data activity obtained a few months later the authorization of the Ethiopian government to initiate the regulatory procedure necessary to obtain the related license.
It is indeed strategic for the telecom operator in the development of its activities in Ethiopia, with a population of approximately 119 million, where Ethio Telecom, its main competitor, already held, as of March 31, 2023, 68.9 million mobile subscribers, including 32.2 million subscribers to the Telebirr mobile payment service. The incumbent operator had launched its Money mobile solution in May 2021, as a prelude to the installation of competition, and subsequently opened it up to a variety of services (international payment, bill payment, payment for goods and services , etc.) over time to get ahead of the advertised competitor.
Seven months after launching its activities, Safaricom Ethiopia has registered nearly 3 million subscribers and has already extended its network to 22 cities. The boss of the Safaricom group is optimistic about the ability of the Ethiopian subsidiary to ramp up in the coming months and to repeat the Kenyan success.
“ Since the commercial launch in October, the brand has been visible, deeply rooted in Ethiopia and quickly integrated into the social fabric. Ethiopia’s potential is immense and we look to the future with optimism and enthusiasm ,” said Peter Ndegwa.
To achieve this overall objective, the company has carried out a precise identification of the market which is opening up to it, while taking into account the current financial inclusion rate of 35%. Safaricom Ethiopia sees opportunity in the 63 million Ethiopians over the age of 18 and the 13.5 million between 14 and 18; the 10,000 large enterprises and the 240,000 medium, small and micro enterprises.
Aware that Ethio Telecom pays great attention to the urban area where 22% of the population resides, Safaricom intends not only to develop competition there but will also seek to win over the rural population which represents 78% of the entire population. Ethiopian.
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