The Ethiopian Government has granted Safaricom (NSE:SCOM) a mobile money licence, therefore paving way for the telco to introduce its popular M-Pesa service in the country.
Safaricom becomes the first foreign telecoms company to be granted a mobile money licence, more than one year after it was awarded a telecommunications licence to operate in the second most populous nation in Africa with population of more than 115 Million people.
The announcement was made by Ethiopia’s Minister of Finance Ahmed Shide during the official switch of Safaricom Ethiopia’s mobile telecommunications network and services in Addis Ababa, the country’s capital city.
Safaricom Ethiopia is the first company in the country to launch a competitive mobile service to state-owned Ethio Telecom. Safaricom Ethiopia’s 2G, 3G and 4G mobile services are now available in 11 cities including the capital and the country’s second largest city Dire Dawa. The company plans to launch services in a total of 25 cities by April 2023 to meet the 25% population coverage obligation in its licence.
Mobile Money Services
The awarding of a mobile money licence to Safaricom comes after Ethiopia’s central bank put in place regulations to enable foreign companies to launch mobile money services.
Safaricom’s M-Pesa will go head to head with state-owned Ethio Telecom service Telebirr which was launched in May 2021, and has reached over 20 million subscribers.
Safaricom Ethiopia is owned by an international consortium including Vodafone Group; Safaricom PLC; Vodacom Group; Sumitomo Corporation; and British International Investment (BII) – the UK’s development finance institution.
Since 2018, Ethiopia has been undergoing a liberalization programme to open up its lucrative telecoms and banking sectors in order to spur growth by rapidly digitising its economy and attract global capital.