Ethiopia was tipped as an expansion target for Safaricom’s m-Pesa mobile money service, as Reuters reported the Kenyan operator is in advanced negotiations with government officials to offer the product there.
Sources told Reuters the pair are considering a deal under which Vodafone Group would licence the m-Pesa brand name to an Ethiopia-based bank. The service would be offered through Ethio Telecom, the country’s state-run telecommunications company, but Safaricom would provide the back-end technology.
Analysts speculated Safaricom could receive a 10 per cent to 25 per cent share of annual revenue from the expansion for its role hosting the service’s servers. M-Pesa revenue in Kenya reached around $627 million in 2017.
Safaricom’s decision to push m-Pesa beyond its home market isn’t all that surprising. During the operator’s most recent earnings call, CEO Bob Collymore said Safaricom was on the hunt for “attractive opportunities to take m-Pesa to other markets”.
The move would introduce m-Pesa to a new market of around 100 million people. As of May 2018, the service had 28.64 million customers.