In a significant development for the Ethiopian mobile financial services market, Safaricom Ethiopia has received the Payment Instrument Issuer License from The National Bank of Ethiopia.

This license allows Safaricom's newly established subsidiary, Safaricom M-PESA Mobile Financial Services PLC, to provide mobile financial services to its customers under the M-PESA trademark.

To enable foreign-owned telecom operators to provide mobile financial services in Ethiopia, The National Bank of Ethiopia amended the National Payment Systems Proclamation, with consultation from industry players in the country.

As part of the process, Safaricom Ethiopia settled the requested investment protection fee, paid by all foreign investors entering a sector protected for local investors.

According to Anwar Soussa, the CEO of Safaricom Ethiopia, the company is thrilled to have been granted a license to establish M-Pesa and provide Mobile Financial Services to its customers.

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"We are delighted to receive the license to establish M-Pesa and start providing Mobile Financial Services to our customers," Soussa said.

"M-Pesa comes with a tested and proven track record of enabling financial inclusion in Africa, provides services to more than 51 million customers across seven countries in Africa with a safe, secure and affordable ways to send and receive money, top-up airtime, make bill payments, get short-term loans and much more."

Soussa expressed gratitude to the Government of Ethiopia, Ministry of Finance, and the National Bank of Ethiopia for their support and guidance in enabling Safaricom Ethiopia to contribute to the efforts of fast-tracking digital inclusion and promoting innovation outlined in the Digital payments Strategy 2025.

M-PESA has over 51 million customers across seven countries in Africa and is the region's largest fintech platform, providing financial services to millions of people with mobile phones but without bank accounts.

Safaricom Telecommunications Ethiopia set up the subsidiary with an initial capital of 50 million Birr, in compliance with Ethiopian legislation.

The company plans to offer mobile financial services under the M-PESA brand by mid-2023.

While welcoming the move, the National Bank of Ethiopia (NBE) said it has been working to promote digital finance offerings in Ethiopia, reflecting a growing demand for such services in the country.

The bank hopes that digital financial services will bring greater efficiency, safety, and transparency to the country's rapidly growing financial system.

"The issuance of the mobile money license reflects the NBE's on-going objective of fostering financial inovation and inclusion in the Ethiopian market," NBE said.

"With NBE support, the menu of digital finance offerings-including mobile banking, mobile wallets, internet banking, and card banking has expanded rapidly in recent years, showing the strong underlying public demand for the use of such services."

"We welcome this shift to the use of digital financial services so as to bring greater efficiency, safety, and transparency to the country's rapidly growing financial system," NBE added.

The bank will continue to take measures to deepen Ethiopia's digital finance ecosystem and support the spread of digital payment systems.

As Ethiopia's financial system modernizes, diverse forms of digital financial services will become tools to help citizens transact, save, borrow, invest, and more.