Addis Ababa, Ethiopia – (African Boulevard News) – Ethiopia’s Central Bank on Thursday granted Kenya’s Safaricom, Africa’s largest telecommunications company, the first mobile money transfer license to a foreign operator in the Ethiopian banking industry. This marks a significant development in Ethiopia’s mobile money market, which has been under government control for years.
Safaricom’s M-Pesa, a pioneering mobile money service launched in Kenya in 2007, has been granted the license after being in talks with the Ethiopian government for several years. The licence allows Safaricom to partner with local banks to offer mobile money services to Ethiopians, who are largely unbanked.
With a population of over 100 million people, Ethiopia is a lucrative market for mobile money, which has been popularized in most African countries in recent years. The country’s robust growth and potential for a tech-savvy younger generation have piqued the interest of tech giants like Safaricom. According to the International Monetary Fund, Ethiopia has one of the lowest levels of financial inclusion in Africa, with only 34 percent of adults having an account with a formal financial institution.
The issuance of the license to Safaricom is expected to boost the country’s financial inclusion efforts while also spurring competition and innovation in the mobile money market.
The move was welcomed by industry experts who believe this will revolutionize Ethiopia’s banking sector. “This is a turning point for Ethiopia’s financial sector. It will increase financial inclusion and create more competition in the market, which is great for consumers,” said Taye Woldemariam, an economist and financial analyst in Ethiopia.
Safaricom CEO Peter Ndegwa commented on the milestone achievement, stating: “Ethiopia presents us with significant growth prospects and is the logical next step in M-Pesa’s African expansion journey.” He also added that the company is working closely with the Ethiopian government and local banks to launch the M-Pesa mobile money service as soon as possible.
Safaricom’s entry into Ethiopia’s mobile money market is expected to pose a challenge to the country’s state-owned monopoly Ethio Telecom, which is set to launch its own mobile money service later this year.
In conclusion, Safaricom’s move into Ethiopia’s mobile money market is expected to boost financial inclusion and spur competition in the banking sector. The issuance of the license to a foreign operator marks a significant change in Ethiopia’s banking industry, which has been controlled by the government for years. With its vast market potential, Ethiopia is poised to become the next frontier for mobile money services.