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Safaricom gets licence to launch M-Pesa service in Ethiopia

Ethiopia has granted Kenya’s Safaricom a licence to launch M-Pesa in the Federal Republic and make the unit it’s subsidiary.

The announcement was made during an investor briefing on Thursday, adding that the telco expects to launch the mobile money services before the end of the year.

“As of this morning, Safaricom Ethiopia has been officially granted the mobile money licence. We look forward to launching M-Pesa in the coming weeks,” said Chief Executive Officer Peter Ndegwa.

The telco said it had completed discussions with the Ethiopian government on how to set up the mobile financial service.

“In line with the applicable legislation, the consortium, through Safaricom Ethiopia, will establish a new entity, Safaricom ET MSF, to obtain a Payment Instrument Issuer License (PIIL) and offer mobile financial services under the M-Pesa brand,” the telco said.

Safaricom launched in Ethiopia in October last year, becoming the first private operator to enter one of Africa’s largest telecoms markets.

Also read: Good news! Safaricom reduces Paybill prices by more than half

Safaricom Ethiopia has grown its customer base to three million users seven months after entering the country.

Mr Ndegwa said voice, messaging and data services had been launched in 22 cities and regions with 1,272 network sites.

State-owned Ethio Telecom had previously enjoyed a monopoly in Ethiopia, Africa’s second most populous country, with an estimated 118 million people.

Safaricom is 35 per cent owned by the Kenyan government and 40 per cent by South Africa’s Vodacom, with the remaining shares listed on the stock exchange.

In 2021, as part of plans to overhaul the telecoms sector, Ethiopia issued a tender to award two licences to private telecoms operators.

“This is the first mobile money licence to be awarded to a foreign investor in Ethiopia.

With the new licence, the telco will now be able to offer services such as mobile banking, mobile wallets, internet banking and card banking.

Also read: Safaricom and Nairobi City County partner to develop ‘My Nairobi App’