Finance & Economics

Ethiopia Considering Opening Mobile Money Market to Foreign Operators

A consultative meeting will be held in Ethiopia by the end of February, during which the prospects of the mobile money market in this country will be discussed.

Ethiopia Considering Opening Mobile Money Market to Foreign Operators

Source: Pixabay.com

During the upcoming meeting, a new concept of activities in the field of mobile money will be discussed, which will replace the 2020 directive. The three-year-old project opened the sector to non-financial players and would have opened the market to foreign operators with a license fee of $150 million. The new concept, which will be the subject of discussion during the consultative meeting, provides for increasing the limits on digital wallet accounts.

Currently, there are processes in Africa that can be described as a revolution of mobile money, but in this large-scale movement of the industry, Ethiopia occupies the last position in terms of the speed of implementation of innovative solutions. Only in 2021, this country launched the first nationwide mobile payment service in Telebirr, provided by the state telecommunications company Ethio Telecom.

In August last year, the Ethiopian fintech Kacha Digital Financial Services became the first private entity in Ethiopia to receive a license for mobile money from the national bank.

Currently, there is a pent-up demand for a local mobile payment service in the Ethiopian market. This is confirmed by more than 1 million people who registered a Telebirr account within a week after its launch.

Ethiopia’s late entry into the mobile money market is explained by internal regulatory restrictions, due to which, until the end of last year, private enterprises were unable to create and use mobile communication networks.

The draft of the new directive and the consultation meeting were prepared because the Ethiopian government is currently considering pending applications from the Kenyan firm Safaricom Telecom Ethiopia to launch M-Pesa mobile payment services.

Safaricom CEO Peter Ndegwa said last year that his company perceives Ethiopia as an opportunistic market. He is also convinced that the form will achieve the same success in this country as in the home market.

As we have reported earlier, Ethiopia’s first contactless prepaid travel card introduced.