Source: Michael Akuchie/ Technext

Safaricom, one of Africa’s leading telecoms companies, has announced the official launch of M-Pesa mobile money services in Ethiopia. This development follows the telco’s acquisition of an operational license from the National Bank of Ethiopia in May. 

As of today, all Safaricom Ethiopia customers can access M-Pesa’s services by either dialling *733# on their Safaricom line or through the mobile app. The app is available to only Android users for now and it currently supports five languages. Plans to release an iOS version in the next few weeks are underway.

In a press statement, Safaricom expressed delight at the thought of offering essential financial services to the Ethiopian market through M-Pesa. Since its launch in 2007, M-Pesa has become a major mobile money operator thanks to its mission of promoting digital financial inclusion. It allows users to pay bills, send/receive money within and outside the country, buy data, and many more. 

Unsurprisingly, its popularity is unrivalled in Kenya, its host market. Although Airtel and T-Kash offer similar services in Kenya, the Safaricom-owned company owns the majority of the market share. Safaricom hopes to replicate the same dominance in Ethiopia. That market has two fascinating qualities, the second-largest youth population in Africa and a large economy.

Stanley Njoroge, the acting CEO of Safaricom Ethiopia said, “M-Pesa is known to be a game-changer for financial inclusion and provides services to more than 51 million customers across seven countries in Africa offering a safe and secure platform for transactions.” He further stated that his company would strive to expand its service delivery for an improved customer experience. 

“M-PESA will play its part in fast tracking Digital Inclusion and promote innovation outlined in the Digital Payments Strategy 2025,” he concluded. Two years ago, the National Bank of Ethiopia rolled out the National Digital Payments strategy. The primary goal is to fully digitize the financial sector while promoting the nation’s economic growth. 

Paul Kavavu, the interim General Manager of M-Pesa also commented on the entry into a new market. He acknowledged M-Pesa as “Africa’s most successful mobile money service and the region’s largest fintech platform for both the banked and unbanked.” He further stated that he and the team looked forward to repeating the same success it achieved in Kenya. To that end, he mentioned that more functions would be added to the platform as part of efforts to reel in prospective users. 

Tough test for M-Pesa in Ethiopia 

When Safaricom announced last week that it would shut down its sites in the Amhara region, it reiterated that the move would not affect M-Pesa’s launch. It didn’t lie. 

With the service now operational, many would expect Safaricom to leverage this and bounce back from the losses recorded early this year. It registered a loss of Sh22.1 billion thanks to the heavy cost of operations it incurred upon launching operations in Ethiopia last year. 

While M-Pesa was a hit in Kenya, it is worth noting that Ethiopia already has a major player. For context, Telebirr, a government-backed mobile money service, reported last month that it had 34 million users. 

Battling and possibly surpassing Tellbirr will be Safaricom’s major challenge. Mobile money services are huge in East Africa, and that already presents tons of opportunities. How M-Pesa capitalizes on this fact remains to be seen. 

Source: Michael Akuchie/ Technext