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Safaricom granted license to operate M-PESA in Ethiopia as the Group Revenue Hits KES 310.9 billion in FY23

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Safaricom (NSE: SCOM) Telecommunications Ethiopia has been granted license to operate mobile money services in Ethiopia. The licence, coming seven months

The licence which is coming seven months after the commercial launch of GSM services will open the country to the world’s largest mobile payment system and Africa’s largest Fintech, as well as the world’s first mobile money transfer system.

Peter Ndegwa, Safaricom PLC CEO said: “We are excited that this is a great milestone following our entry into Ethiopia. This positions us to provide essential financial services to the Ethiopian population. We are looking forward to launch and roll out the service over the next few months.”

M-PESA empowers over 30 million customers to transact, save or borrow money through their mobile phone. M-PESA catalysed financial inclusion in Kenya to 84% from a low of 26.7% in 2006 according to the 2021 FinAccess Survey and generated over KES 117.2 billion ($886 million) in revenue in FY23.

He added: “Since the commercial launch in October, the brand is visible, deeply rooted in the Ethiopia and quickly becoming in every sense fabric of the society. The potential for Ethiopia is immense and we look forward to the future with optimism and excitement.”

In the period under review, Safaricom Telecommunications Ethiopia added close to 3 million customers and built a distributor network of over 114 outlets, delivered an award-winning premium quality network in 22 cities and regions; with close to 1300 network sites and over 900 staff, 81% of whom are Ethiopians.

Mr Ndegwa spoke during the announcement of the Full Year 2022/2023 results, which saw net income increase by 3.0% to KES 74.5 billion for Safaricom Kenya.

Safaricom increased its Group Service Revenue by 5.2% to KES 295.7 billion while the Group net income excluding minority interest declined by 10.6% attributable to expected start-up costs and investment in rolling out operations in Ethiopia within the year. Voice service revenue declined by 2.6% to KES 81.1 billion; mobile data revenue grew by 11.4% to KES 54.0 billion, while M-PESA revenue grew by 8.8% to KES 117.2 billion.

Mr Ndegwa said: “We have delivered a solid set of results despite the tough operating environment occasioned by slowdown in business activity in an election year in Kenya, tough macro environment as well as change in mobile termination rates which impacted our voice revenues significantly. The business is stable and regained a strong positive momentum in the second half of the year. Looking into the future, we passionately believe that our business is well-positioned to support our customers and provide technology solutions as we transition into a purpose-led technology organization in line with our 5 YR strategy.”

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