The suspension of bidding for a second telecoms operator permit in Ethiopia will not derail the introduction M-Pesa licence in the populous nation, clearing the way for Safaricom #ticker:SCOM to launch the mobile money service this year.
Safaricom licence, which was offered last year, was to be upgraded to include mobile financial service after completing bidding for its second telecoms operator permit.
This was thrown into disarray after Ethiopia suspended bids for a second telecommunication licence.
Dr Eyob Tekalgn Tolina, the State Minister of Ethiopia’s Ministry of Finance, told the Business Daily that it has delinked the M-Pesa permit from the second operator’s licence.
He said Ethiopia will keep its promise to Safaricom to give the Kenyan telco giant an M-Pesa license by May.
“The second operator license is still in the making but we have delayed it because of the current situation we felt we will not get the right competitors now. We have pushed it by a few months,” Dr Tolina said in an interview with the Business Daily.
“That has nothing to do with the financial services license, Safaricom will get that because that was part of the promise we made to give it this year.”
Ethiopia is finalising legal changes to allow the central bank to issue Safaricom with a licence for mobile financial services.
A consortium led by Safaricom secured the first licence, which does not have a permit for mobile financial services like M-Pesa, in May.
The Horn of Africa nation sold only one of two full-service licences on offer in May, citing a lower-than-expected price for the second one, which it now wants to offer again.
It is liberalising its telecoms sector in a bid to pivot to a modern, digital economy in line with reforms unveiled by Prime Minister Abiy Ahmed in 2018.State monopoly Ethio Telecom, which launched a new mobile financial service called Telebirr in May, snagged 4 million users within weeks, showing the potential of the market.Ethiopia had one of the world’s closed telecoms markets.A delay by the Ethiopian Communication Authority (ECA) in issuing the second license had dampened Safaricom’s prospects to launch into the lucrative mobile money market.“They have been very active and I think they are planning for a launch sometimes in April and so far have kept their momentum in attaining the critical milestones,” Dr Tolina said.Mobile financial services have become a significant part of African telecoms operators’ businesses since Safaricom pioneered them with M-Pesa in […]
