Safaricom’s bid to operate M-Pesa in Addis boosted by mobile money services launch

MK254

MK254

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May 11, 2013
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Safaricom is still hopeful that it will launch mobile money services in Ethiopia as it awaits the decision on the acquisition of a licence to operate in the country.

The telco’s bid for control of the Ethiopian telecommunication market seems to have received a boost ahead of the official acquisition of the licence with the news that the Addis administration plans to liberalise mobile money services next year.

Prime Minister Abiy Ahmed said mobile-based financial services in Africa’s second most populous country will be opened to competition in the next 12 months, setting the stage for Safaricom to launch M-Pesa platform, which is a key driver of its revenues.

In April 2020, Addis indicated that only local companies would be allowed to offer mobile money transfer services in the country after the central bank sought to boost non-cash payments.

Safaricom declined to comment on the mouth-watering proposal ahead of the conclusion of its bid for the Ethiopian telecom licence, but the management remains optimistic that the proposal will open up opportunities for growth and investment for a teleco that is in the process of transforming into a technology company.

Safaricom announced that it is in the process of transforming into a purpose-driven technology firm by broadening its financial offerings beyond mere payments and credit to financial solutions that are capable of supporting small and medium-sized enterprises (SMEs) and corporates, including investment in the fibre business.

www.theeastafrican.co.ke

Safaricom’s bid to operate M-Pesa in Addis boosted by mobile money services launch

PM Abiy Ahmed said mobile-based financial services in Africa’s second most populous country will be opened to competition in the next 12 months.
www.theeastafrican.co.ke www.theeastafrican.co.ke
 
Technology

Orange to Consider Bid for Stake in Ethiopian State Telecom​

By
Loni Prinsloo
and
Myriam Balezou
14. Mai 2021, 13:50 MESZ Updated on 14. Mai 2021, 14:09 MESZ
  • French wireless carrier looking to engage with government
  • Ethiopia selling shareholding as part of wider privatization

Orange SA is interested in buying a minority stake in Ethiopia’s state-owned telecom monopoly as part of the country’s privatization of the industry, according to people familiar with the situation.

The French group will consider bidding for the 40% shareholding in Ethio Telecom, said the people, who asked not to be identified as the process hasn’t been concluded. Orange opted to explore the acquisition of the stake rather than one of two new licenses being auctioned to international operators, they said.

Eyob Tekalign, the Ethiopian minister responsible for privatization, said the government can’t comment on who might be interested because the process hasn’t formally started. Orange declined to comment.

A successful sale of the stake in Ethio Telecom would deliver a boost to a wider liberalization intended to generate foreign exchange and improve service for the nation’s 110 million people -- the second-highest population in Africa. Ethiopian Prime Minister Abiy Ahmed’s administration has made privatization a key part of its plan for economic reform, aiming to boost investment and jobs.

Orange initially indicated an interest in taking one of the new licenses, but the company’s name was absent when a list of bidders was released last month. Instead, a consortium including Vodafone Group Plc, Johannesburg-based Vodacom Group Ltd. and Kenya’s Safaricom Ltd. made an offer, as did a partnership between MTN Group Ltd., Africa’s largest wireless carrier, and China’s Silk Road Fund.

The outcome of those auctions has yet to be announced.

Mobile Money​

One sticking point for bidders was uncertainty over whether they will be able to offer a mobile-money service, a major generator of revenue and profit for African operators. The Ethiopian government eventually ruled that it won’t be allowed for now, a decision that cost the state about $500 million, Abiy said this week.

The new entrants will be allowed to add financial services in about a year, he said, though Ethio Telecom will be given the green light right right away. That would give Orange a potential advantage of its international rivals, should the talks to buy the stake be successfully concluded.

Details of Ethio Telecom’s finances are patchy, but the company generated revenue of about 25.6 billion birr ($600 million) in the six months through December and has 53 million subscribers, covering about half the population. The horn of Africa country also has a minimal 4G network, presenting an opportunity for new entrants to expand rapidly.

— With assistance by Samuel Gebre
(Updates with Orange no comment in third paragraph)

www.bloomberg.com

Orange to Consider Bid for Stake in Ethiopian State Telecom

Orange SA is interested in buying a minority stake in Ethiopia’s state-owned telecom monopoly as part of the country’s privatization of the industry, according to people familiar with the situation.
www.bloomberg.com www.bloomberg.com

Ethio Telecom enjoys a mobile money monopoly​

VAUGHAN O'GRADY13 MAY 2021749

Ethio Telecom enjoys a mobile money monopoly


As expected, Ethiopia's state telecoms monopoly, Ethio Telecom, has launched a mobile money service with the aim of boosting growth by offering cashless transactions.

Called telebirr, it is, for now at least, the only mobile financial service permitted in the country. Foreign operators, when they arrive, will be barred by law from offering such services.

Users will be able to send and receive money, deposit or take out cash at appointed agents, pay bills to various merchants and receive cash sent from abroad.

This is quite a change for Ethiopia, where the failings of the banking system are likely to give alternative financial services a real boost. Certainly, expectations are high for the new service, with figures like 33 million users in five years being bandied about by Ethio.

According to Reuters, the company’s chief executive Frehiwot Tamiru even suggested that some 40 to 50 percent of Ethiopia’s annual economic output could be transacted on the platform in five years.

Meanwhile the government is readying itself to sell a 45 percent stake in Ethio and to auction two new full-service telecoms licences, neither of which will allow the winners to roll out mobile financial services.

According to Bloomberg, the government has admitted that it will take a financial hit from this stance. In fact the prime minister has been quoted as saying that forbidding new entrants to offer mobile money could have cost the government some $500 million due to lower bidding.

Presumably the expectation is that Ethio’s service will be highly profitable. There’s certainly a strong incentive to bring mobile money to Ethiopia, given the success of such offerings in so many other African countries. However, Ethio will now have to prove that it doesn’t need competition to perform well in this market.

www.developingtelecoms.com

Ethio Telecom enjoys a mobile money monopoly

As expected, Ethiopia's state telecoms monopoly, Ethio Telecom, has launched a mobile money service with the aim of boosting growth by offering cashless transactions.
www.developingtelecoms.com www.developingtelecoms.com


MY TAKE
Ni pale kampuni flani itakapoangukia pua!
 

Orange not getting into Ethiopia…or its own way in Belgium​

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Ethiopia has shared the names of just two bidding groups for its two available telecoms licences, a disappointing outcome from one of the world’s last great liberalisation opportunities.

The deadline – pushed back from March – for submissions for the licences expired on Monday, at which point the Ethiopian Communications Authority (ECA) talked up the response it has received, particularly from African telecoms companies.

“We are delighted to have had interest from established telecoms operators from around the world, commensurate with this unprecedented opportunity, including from Africa’s two telecommunications ‘giants’, MTN – the largest mobile operator on the continent, and the Vodafone/Vodacom consortium, including Kenya’s largest telecoms provider, Safaricom,” the ECA said in a statement.

The telcos themselves later confirmed that the Vodafone/Vodacom.Safaricom grouping will also include CDC Group and Suitomo Corporation, while MTN said it is bidding alongside equity partners including China’s Silk Road Fund; it said it will disclose the identities of the other partners should its bid prove successful.

The ECA said it will evaluate the bids based on technical and financial criteria, but did not give a timeframe for selecting the winning licensees.

The global telcos interested in the Ethiopia liberalisation included France’s Orange, which ultimately did not submit an offer. Company executives were cagey on the telco’s plans at its results call last week, when CFO Ramon Fernandez said “let’s see” in response to a direct question on Ethiopia. “The process is ongoing,” Fernandez said, adding that if the conditions for market entry are not good enough then Orange will not go.

This might not be the end of the road to Ethiopia for Orange though. The market liberalisation process also includes the sale of a 45% stake in incumbent operator Ethio Telecom and there have been hints that this could be a way in for Orange.

“It seems companies like Orange and Etisalat are more interested in buying a stake in Ethio Telecom,” Reuters quoted Brook Taye, a senior advisor at Ethiopia’s finance ministry, as saying.

Of course, this could just be bravado on Taye’s part, but there is one good reason why it could be the case: mobile money.

The two new licences up for grabs will allow the winners to offer a full portfolio of telecoms services, but not mobile financial services.

Meanwhile, Ethio Telecom has previously announced plans to offer mobile money transfer services, Reuters said. Given Orange’s experience in this field, it is not inconceivable that the desire to extend its mobile money and banking services would lead it to consider such a move.

Speaking of money, Orange has found itself in something of an awkward situation in Belgium.

Having had to fight its corner over its €22-per-share buyout offer to minority shareholders of Orange Belgium after one such holder – Polygon Global Partners – publicly accused it of undervaluing the asset, Orange on Tuesday admitted that it had secured fewer than half of the shares it sought during the offer period that closed last week. Shareholders representing 21.66% of Orange Belgium’s share capital took up the offer and tendered their shares, the telco said. It had been aiming to pick up a stake of 46.1% to give it sole ownership and delist the unit.

As a result, Orange has reopened the tender, giving minorities until 4 May to sell their shares, still at the initial €22 price. But it knows it will not reach the 95% level it needs to launch a squeeze-out bid because Polygon, which holds 5.29% is adamant it will not tender its shares, reiterating that in its view Orange’s offer is derisory.

“As Orange Belgium continues to execute on its business plan, Polygon believes that other minority shareholders will similarly resist tendering their shares at the current offer price,” it said.

telecoms.com

Orange not getting into Ethiopia...or its own way in Belgium - Telecoms.com

Ethiopia has shared the names of just two bidding groups for its two available telecoms licences, a disappointing outcome from one of the world's last great liberalisation opportunities.
telecoms.com telecoms.com
 
Abiy Ahmed said after one year, other operators will be allowed to bid for mobile money licenses. He said this after Ethiopia realised that they had lost $500 million by refusing to open the mobile money market. So the mobile money market will be opened in the next one year.
Mr Wivu anayesherehekea kwamba Mpesa imefungiwa nje ajue kwamba Ethiopia imebadilisha mawazo na itafungua market next year.



 
Tony254 said:
Abiy Ahmed said after one year, other operators will be allowed to bid for mobile money licenses. He said this after Ethiopia realised that they had lost $500 million by refusing to open the mobile money market. So the mobile money market will be opened in the next one year.
Mr Wivu anayesherehekea kwamba Mpesa imefungiwa nje ajue kwamba Ethiopia imebadilisha mawazo na itafungua market next year.



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So out of all media i should trust Kunyaland's media on this!
 
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