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Ethiopia Opens Up Mobile Money Services to Local Non-Financial Firms


Ethiopia is in the midst of massive economic reforms led by reformist Prime Minister Abiy Ahmed, including the privatization of state-owned telecommunications monopoly
Ethiopia is in the midst of massive economic reforms led by reformist Prime Minister Abiy Ahmed, including the privatization of state-owned telecommunications monopoly

Ethiopia's central bank will allow locally-owned non-financial institutions to start offering mobile money services as it seeks to boost non-cash payments in the country, it said.

The Horn-of-Africa nation is in the midst of massive economic reforms led by reformist Prime Minister Abiy Ahmed, including the privatization of state-owned telecommunications monopoly Ethio Telecom.

The new directive would allow Ethio Telecom, as an Ethiopian-owned company, to move into mobile money. Any foreign-owned companies, however, would remain locked out, according to the new regulations that were published on Wednesday.

Foreign telecom operators, including Kenya's Safaricom and South Africa's MTN, have expressed interest in bidding for telecoms licenses in Africa's second most populous country.

But without further changes to the regulations, they will remain unable to offer mobile financial services business, analysts said.

"This directive effectively excludes foreign fin-tech and telecom companies from reaping the business benefits," Bahakal Abate, a corporate lawyer in Addis Ababa, told Reuters.

In February, Ethiopia delayed the award of two telecoms licenses to multinational companies. The licenses would end the state monopoly and open up one of the world's last major closed telecoms markets.

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    Reuters

    Reuters is a news agency founded in 1851 and owned by the Thomson Reuters Corporation based in Toronto, Canada. One of the world's largest wire services, it provides financial news as well as international coverage in over 16 languages to more than 1000 newspapers and 750 broadcasters around the globe.

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