The Central Bank of Ethiopia Looking to Decentralize Mobile Money Beyond Banks and MFIs

The National Bank of Ethiopia has drafted a directive that will soon enable non-financial institutions to apply and run mobile money service licenses.

The National Bank of Ethiopia, which is the Central Bank of Ethiopia, is looking to open investment doors by allowing private commercial companies and government institutions to operate as payment instrument issuers and improve financial inclusion in the country.


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Currently, only 20% of the over 100 million Ethiopians have a bank account and mobile money licenses are only reserved for banks and micro-financial institutions.

If the proposed bill is passed, any registered business in Ethiopia will be able to apply for a mobile money license from the central bank and run its own operations.

The requirements for the license have been stipulated as follows:

  • Registered business should be wholly owned by Ethiopians or non-nationals with Ethiopian origin
  • The business or company should have a minimum capital of 50 million Birr ( Approx. $1.7M)
  • Payment instrument issuers to apply 2-factor authentication for transaction amounts great than 1.00 Birr ($34) for maximum protection of electronic transactions

In addition, the new directive notes that these payment instrument issuers will be allowed to give savings and credit services, sell insurance products, and pay out pensions.

The draft directive allows for three levels of transactions below:

  • Level 1 – Maximum permitted account balance is 3,000 Birr (Approx. $100) wtih an aggregate daily and monthly transaction limit of 300 Birr ($10) and 6, 000 Birr ($200) respectively
  • Level 2 – Maximum account balance is 15,000 Birr (Approx. $500) with an aggregate daily and monthly transaction limit of 2,000 Birr ($70) and 25,000 Birr ($850) respectively
  • Level 3 – Maximum account balance is 25,000 Birr (Approx. $850) with an aggregate daily and monthly transaction limit of 5,000 Birr ($170) and 50,000 Birr ($1,700) respectively

The directive has apparently been informed by the successful experience of mobile money in Kenya which is expected to help achieve financial inclusion and bring about a cashless society by relaxing restrictions on daily and monthly transaction volumes. Currently, in Kenya, daily mobile money limits stand at KES 75,000 ($750) per transaction and KES 150, 000 (Approx. $1, 450) per day.




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