Ethiopia is currently reviewing a bill that will allow non-financial institutions to engage in mobile money transfer. In a bid to create a more inclusive financial sector, Ethiopia’s central bank has proposed a directive that will decentralize mobile transfer services. Currently, only banks and microfinance institutions offer mobile money services.
The National Bank of Ethiopia is partnering with private players to improve the country’s levels of financial inclusion. World Bank reveals that in 2017, only 35% of its population owned bank accounts.
The bank will partner with financial institutions like banks and insurance companies to offer payments as well as to offer credit and savings products. Moreover, the move will also enable service providers to enroll individuals on various insurance and pension products.
If the bill receives approval, major players like Ethio money will be able to serve the country’s vast population. The Telcom company serves approximately 41.9 million subscribers through its voice services, out of the total population of 100 million.
Terms for Mobile money providers.
The directive allows registered businesses to apply for mobile money licenses for the central bank. Companies require a minimum capital of $1.7 million to apply for the permit. However, the majority shareholder of the company should not contribute more than 5% of this capital.
Also, the directive offers accounts with three different levels of transactions. According to Fortune, the first account has a ceiling amount balance of $102, a daily aggregate of $ 10. The account has a monthly transaction limit of $204.
Second, another account maintains a maximum float of $510, a daily aggregate of $67 and a monthly limit of $851.
Lastly, the bank offers a wallet that provides a maximum balance of $851. Additionally, the account has a daily aggregate of $170 and a monthly limit of $1700.