Safaricom Ethiopia announces that it has started to purchase equipment to operate M-pesa in Ethiopia projecting to get a license in May. The consortium led by Safaricom secured its license which does not entail mobile financial services but the firm remains hopeful that it will get the nod sooner rather than later.

“As far as our preparedness, the equipment for the M-pesa platform has been ordered,” said Pedro Rabacal, Chief Technology Officer of Safaricom. He explained that the consortium is waiting on the rent and that it’s a matter of getting the right documentation in place from the right authorities to be able to import the equipment.

As per the law, the national bank of Ethiopia restricts foreigners to get into the financial services space. However, government is said to be finalizing on legal changes to allow the central bank to issue Safaricom with a license for mobile financial services.

“To operate M-pesa we would need a similar license to that of Ethio telecom for Telebirr, from the national bank,” said Matthew Harrison-Harvey, Chief External Affairs and Regulatory Officer of Safaricom, adding, “we are diligently preparing with the assumption that we will be launching the service since the Prime Minister said on May 2021 that in 12 months’ time the foreign owned telecommunications operators will receive a license.”

Authorities said that the Safaricom license will be upgraded to include mobile financial service so as to introduce its popular M-Pesa to the market of 110 million people. This came after the decision to include the mobile phone-based financial services in tele’s license offered in May.

A couple of weeks ago Eyob Tekalgn /Ph.D./, State Minister of Finance, in his interview with Kenya medias said government will keep its promise to Safaricom by giving it the M-Pesa license by May.

“We are waiting for the government and the national bank’s communication with regards to the change in directives as we prep for the application of the license,” said Matthew.

As per its agreements with the Ethiopian government, Safaricom- Ethiopia gears towards its commercial launch which will come to fruition, early April, as it plans to provide 4G and 5G internet service. It is also said that by 2023 a low orbit satellite will be put in place to provide nationwide 4G coverage by the firm.

Safaricom plans to switch on its network on April 2022 and lots of testing are ongoing. According to Pedro Rabacal, the firm plans to gain 25 percent coverage of the population by March 2023.

The private telecommunications entrant is working with the global telecom giant Nokia and with the Chinese global telecom giants Huawei for its infrastructure development for its operation in Ethiopia. In addition, Safaricom will use satellite services to cover the country with areas that cannot be reached using fiber networks. The telecommunications firm will also be using rooftops in addition to building their own towers for their networks.

Safaricom Ethiopia which was formed by the amalgamation of Safaricom, Sumitomo Corporation, CDC Group and Vodacom secured operational license from the government to officially do business in Ethiopia as a second telecom company after the state owned Ethio Telecom. To get the license it had to pay USD 850 million to the government and promised to invest up to USD 8.5 billion in the coming decade.