Ethiopia has granted Safaricom a license to launch M-Pesa in the populous nation, which is largely unbanked.
The telecom company expects to roll out its mobile money services before the end of the year, a move set to further elevate the company’s profile since its launch in Kenya in 2007.
“As of this morning, Safaricom Ethiopia has officially been granted the license to operate mobile money. We look forward to launching M-Pesa in the coming weeks,” CEO Peter Ndegwa said on Thursday morning during an investor briefing.
Safaricom announced a 22.2 percent decline in full-year net profit for the year ending March 2023, down to Ksh.52.48 billion. This marks the third consecutive drop in earnings, driven by capital investments in Ethiopia.
The unit recorded a net loss of Sh21.7 billion, but Safaricom expects it to break even in its fourth year of operation.
License Fee
The Safaricom-led consortium in Ethiopia has paid $150 million (Sh20.5 billion at current exchange rates) in license fees to the National Bank of Ethiopia (NBE).
The banking sector regulator said on Thursday that it had issued the mobile money service license to Safaricom M-Pesa Mobile Financial Service, a new subsidiary that is the first foreign-owned entity to receive such a license.
“We welcome this shift toward the use of digital financial services to bring greater efficiency, security, and transparency to the country’s rapidly growing financial system,” the NBE said in a statement.
Safaricom Ethiopia increased its customer base to three million users seven months after entering the country. Mr. Ndegwa said that voice, messaging, and data services had been rolled out in 22 cities and regions with 1,272 network sites. The company has so far employed 909 staff members.
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