Safaricom M-Pesa Secures Mobile Money License in Ethiopia

Safaricom M-Pesa Expands into Ethiopian Market

The National Bank of Ethiopia (NBE) has granted a mobile money-service license to Safaricom M-Pesa Mobile Financial Service. This marks a significant development in Ethiopia's telecommunications sector, previously dominated solely by Telebirr, the mobile money service of the state-owned Ethio Telecom network. This move allows Safaricom M-Pesa, a Kenya-based company, to operate in the Ethiopian market, providing consumers with more choices in mobile financial services.

Breaking Ethio Telecom's Monopoly

Safaricom's entry into Ethiopia is not entirely new. In October, Safaricom Telecommunications Ethiopia, a subsidiary of Safaricom, became the first company to challenge Ethio Telecom’s monopoly on mobile phone services. This was made possible by legislative changes introduced by the NBE earlier in 2022, which paved the way for private companies to enter the Ethiopian telecom market.

Legislative Changes and Market Impact

The introduction of legislation by the NBE was a crucial step in transforming Ethiopia's telecommunications landscape. By allowing private service providers like Safaricom M-Pesa to enter the market, the Ethiopian government aims to foster competition, enhance service quality, and provide more options for consumers. This strategic move is expected to boost technological innovation and economic growth within the country.

Future Prospects for Mobile Financial Services

The issuance of the mobile money license to Safaricom M-Pesa signifies a shift towards a more competitive and diverse telecom market in Ethiopia. As Safaricom establishes its presence, the market dynamics are likely to evolve, offering consumers improved services and potentially driving down costs. This development sets the stage for further advancements in Ethiopia's mobile financial services sector, promoting financial inclusion and accessibility for its population.