According to the GSMA State of the Industry on Mobile Money 2017 report, the number of central Africans transferring cash via money apps increased from 23.6 million in 2016 to 32.9 million in 2017. Therefore, the news that Safaricom plan to launch their mobile money app, M-Pesa, which has nearly 30 million subscribers in Kenya alone, in Ethiopia is a positive move. Millions have already been raised to support the development of digital payments, leading experts to predict that the launch of M-Pesa in Ethiopia will transform the way the nation handle their money for good.
The growth of Safaricom
In Kenya, M-Pesa holds 80.8% of the country’s mobile money app market share, while its closest rival, Equitel Money, holds just 6.8%. Across the country, Safaricom has become more than just a method used to transfer money from one individual to another. The telecoms operator has invested in multiple sectors including, ride-sharing apps and e-commerce. Additionally, the company has also launched its own social network which allows users to send money while talking to one another. So, it’s clear to see why they would want to branch out into other heavily populated countries, such as Ethiopia which has a population of more than 100 million.
A positive move for the country’s finances
Data released from the IMF earlier this year revealed that Ethiopia is on track to become the fastest growing economy in sub-Saharan Africa by the end of 2018. With the economy booming, now is the time for the M-Pesa app to launch to ensure that the nation takes control of its money in the most effective and convenient way possible. Ethiopians with loans and other forms of debt will benefit significantly from the M-Pesa app as it will allow them to transfer cash to those they owe at any time and give them the means to track all their payments.
The benefits of mobile money apps
One study that looked into the long-term effect of using mobile money on Kenya’s economy found that 194,000 Kenyan households were no longer in poverty as a result of mobile money. Ethiopia currently falls within the top 10 countries with the highest prevalence of poverty as 23.9 million currently live in such conditions, according to The World Poverty Clock. Therefore, with mobile money apps providing such impressive results in Kenya, families in Ethiopia could see themselves financially better off should M-Pesa become available in the country, too.
M-Pesa is a major money management app in Kenya which other African countries could benefit substantially from. Therefore, should Safaricom agree a deal with Ethiopian officials, the nation would be sure to utilize the service and all that it offers due to its financial tracking, sending and receiving abilities.