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Safaricom taps Onafriq to enable remittances to Ethiopia

Thursday 21 March 2024 13:59 CET | News

Kenya-based telecommunications company Safaricom has augmented its M-PESA platform, through a partnership with Onafriq, to offer remittances to Ethiopia.

 

M-PESA Safaricom has signed an international money transfer agreement with Onafriq, one of Africa’s largest digital payments network. The partnership will help streamline remittance flows to Ethiopia. Onafriq currently operates in 40 African countries.

M-PESA offers swift and convenient financial solutions via mobile phones, eliminating the necessity for a bank account—only a Safaricom SIM card is required. As part of the arrangement, individuals in Ethiopia can now receive remittances from various global locations through M-PESA. This initiative has been made possible by the authorisation granted by the National Bank of Ethiopia for the commencement of remittance services in 2023.

Safaricom has augmented its M-PESA platform through a partnership with Onafriq to offer remittances to Ethiopia.

The remittance landscape in sub-Saharan Africa

In 2023, the World Bank estimated that the remittances flow to countries in sub-Saharan Africa reached USD 54 billion in 2023. This represented an increase from the previous year’s gain. This increase was driven by strong remittance growth in countries including Mozambique, Rwanda, and Ethiopia. M-PESA argues that the increase is a move in the right direction but more work needs to be done. The receipt of remittances plays an important role in reducing poverty as well as the GDP of a country.

The collaboration allows M-PESA to tap into and leverage Onafriq’s extensive network. This connects 500 million mobile money wallets and 200 million bank accounts. Moreover, it enables domestic and cross-border disbursements and collections, card issuing and processing, agency banking, and treasury services.

Ethiopia generates more than USD 5 billion in remittances annually

Officials from Safaricom said their goal is to make payments easier. The incorporation of international money transfer services into M-PESA serves that purpose. Ethiopia generates more than USD 5 billion in remittances annually. This partnership will provide the Ethiopian Diaspora with an easy and fast formal channel to send money to their loved ones in Ethiopia.

Also commenting on the impact of the partnership, representatives from Onafriq said the partnership will directly stimulate the realisation of Ethiopia’s digital transformation strategy. They have always believed that payments should be a simple process. As simple as a phone call, connecting individuals through increased access. The agreement with M-PESA Safaricom extends their reach in Africa even further. They are confident that this partnership will positively impact economic growth and the achievement of greater sustainable development goals.


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Keywords: remittance, money transfer, mobile payments, expansion, growth markets
Categories: Payments & Commerce
Companies: Onafriq, Safaricom
Countries: Africa
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Payments & Commerce

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