Foreign fintechs are soon to be allowed entry following the newly tabled proclamation which revises a decade old national payment system proclamation.
During the latest session held on Saturday August 6, the Council of Ministers approved the amendment for the national payment system proclamation no 718/2011 that was first issued in 2011.
When the proclamation is ratified by the parliament it will pave a way for foreign investors to get involved on the country financial systems at least this time around as payment operators.
So far there are two companies which venture in Ethiopia as fintech operators; Ethio Telecom’s Telebirr and Kacha Digital Financial Services, which recently introduced its operation.
Early this week, Solomon Damtew, Acting Director of Payment and Settlement System Directorate at National Bank of Ethiopia (NBE), said that the proclamation amendment will be a game changer since it allows well known and experienced foreign companies to invest on the market.
“Following the amendment of the proclamation, the ecosystem will be opened which means that highly experienced foreign companies will enter into the Ethiopian payment system,” he said.
“The move will uplift the success that we have so far achieved on the sector and will foster the use of a cashless economy in addition to ensuring financial inclusion besides strengthening the digital payment ecosystem,” he added.
According to Solomon, NBE, a financial sector regulatory body, is developing detailed directives that will allow providing a license for the incoming operators.
Despite being about 14 months in, the state owned telecom provider, Ethio Telecom’s Telebirr has been able over half of its subscriber to mobile money users. The number of agents that are hired by fintech or financial firms has also shot up by 800 percent to reach 156, 876 in just a single year’s time from about 15,000 agents in the 2020/21 financial year.
According to Solomon, most of the new agents are aligned with Telebirr.
Solomon told Capital that the proclamation revision has taken about three months of prudent work.
According to the proclamation, national payment system consist sending, receiving and processing of orders of payment or transfers of money in domestic or foreign currencies, and issuance and management of payment instruments and payment, clearing and settlement systems.
It added that payment service providers, including operators, participants, issuers of payment instruments and any third party acting on behalf of them, either as an agent or by way of outsourcing agreements, may entirely or partially operate in the country.
On its entry as a first private and foreign investor to the telecommunication industry, Safaricom has expressed its interest to be a mobile money player in the country to which the government has finally given a green light to its demand. As a result, the Kenyan telecom brand is expected to be one of the pioneer foreign companies to invest as a fintech. The company is popular for its revolutionary M-Pesa mobile money service.
New proclamation to pave way for foreign fintechs
Tech gurus to converge in Addis, this September
Jorka Events prepares for the Africa Tech Expo to be held on September 7-9 in Addis Ababa Skylight hotel, which is a first event of its kind in Ethiopia.
Ambassador Dina Mufti, Director General of Public Diplomacy at the Ministry of Foreign Affairs and Samson Haileyesus, Director of Jorka Events Communication both gave a joint statement during a recent press briefing.
As indicated on the press briefing, the fair will focus on solar technology, electric vehicles, digital payment systems, telecommunication, and banking, gathering hundreds of customers, tech entrepreneurs, and vendors at the African Tech Expo (ATX) in the capital of Africa, Addis Ababa. Similarly, the ATX is expected to enhance economic diplomacy and bring suitable technologies to Ethiopia.
It is reported that exhibitors are registering to attend the technology fair. Among other companies, it is expected that internationally known firms such as Jumia, Amazon, Microsoft, Meta, Oracle, Siemens, Access, and China Unicom will be present at the exhibition.
More than 250 exhibitors including more than 50 startups are expected to participate on the trade fair.
Worku Aytenew buys Kuriftu-Bahir Dar
Kuriftu Resort and Spa-Lake Tana in Bahir Dar gets a new owner as Tadiwos Belete transfers ownership to Worku Aytenew.
Inaugurated in 2014, the 4 star resort lays down on a 5,000sqm of land near its existing property on the shores of Lake Tana. Boston Partners PLC, which owns Kuriftu Resort and Spa built Kuriftu resort at Bahir Dar with 15 million birr.
Sources indicate, the process is being finalized; however they refused to comment on the transaction amount.
Tadiwos Belete, founder of Boston Partners PLC, a company which owns a chain of hotels and spas under the brand name of Kuriftu in various parts of the country, also owns the resort in Bahir Dar.
Except indicating that the resort will not change its name, Tadiwos refused to Capital’s request to provide further comments on the issue.
Bahir Dar admittedly houses several hotels and restaurants. However, this is not enough to cope with the growing demand of visitors and customers.
In related news, Kuriftu Resort has also started operations of its newest resort at the Awash Falls. The firm has also diversified and taken its operations brand abroad after Boston Partners opened a restaurant in Djibouti.
Kuriftu is expected to be the first hospitality industry led business for Worku Aytenew who is a newly emerging business tycoon owning many huge companies in different parts of Ethiopia. The business magnate has invested in the palm oil importation business, commercial farming, mining, aviation, and real estate.
PM rallys global investors to create recreational sites at GERD
Ethiopia calls on global partners to invest in recreational development on the islands on the artificial lake formed behind the Grand Ethiopian Renaissance Dam (GERD).
Prime Minister, Abiy Ahmed pointed out that the dam height has now reached at least 600 meters above sea level at the center up from 575 meters from a year ago.
At the launching event of the third water filling at the GERD on Friday August 12, Abiy said that the river, which the PM describes as a gift from God, has become a global development hub which bears enormous potential.
He said that the artificial lake on the Abay River has about 70 islands which can serve as recreational destinations. He invited global partners to be part of different recreational developments at the site that is suitable for hiking, fishing and other entertainment, “the world must be ready to use it and invest here.”
“We Africans have endorsed the continental economic integration to which the project allows us to share our resources with other Africans in realizing our long term vision of powering the grid and creating prosperity on the continent,” he added.
Noting that Abay is a natural resource given for Ethiopia, Sudan and Egypt, the PM underlined that many works can be done that would benefit not only the three downstream countries but also other states, if they use it properly.
“It should be understood that the river, which is a free gift given by God for the three downstream countries, must be utilized properly by working together,” he said whilst calling on the co-states to work together for mutual benefit and shared development strategies on the resource.
Abiy also said that the civil works that were conducted in the past one year have created the opportunity to catch up to 22 billion cubic meters of water.
On Friday he disclosed that the project has achieved the third water filling.
Kifle Horo, Project Manager of GERD, said that since the reform period that took correction on the project handling, the hydraulic steel structure works have been accomplished which allowed the central part of the dam construction to increase from 25 meters to 100 meters, while the left and right wing have expanded to 145 meter and 111 meters.
“The civil work and electro mechanical work has been accomplished by 95 and 61 percent respectively which when combined brings the total accomplishment to 83.3 percent,” he said, adding, “in the coming up to two and half years the project will be fully finalized.”
According to the Project Manager, despite several challenges in the past few years the project has continued to attain massive successes.
In February, the first generation was introduced which was then followed by the second unit, unit 9, official power production on Thursday August 11. The two turbines that are currently operating have a generating capacity of 375 megawatts.
Currently, spiral case installation works at unit 6, 7, 8, 14, 15, and 16 is being undertaken.
