The International Mobile Communication System Association announced that if the mobile payment system is widely used in Ethiopia, the country’s GDP will increase by 5.3 billion dollar.
This will happen by the end of 2030 if 60 per cent of the country’s population uses the mobile payment system, the association said.
The organization also indicated that it would lift 700,000 people out of extreme poverty and increase tax revenue by 300 million dollar.
However, there is relatively 99 per cent network coverage in Ethiopia; Unreliability of network quality, lack of understanding of the digital system, the question of trust and information privacy and security, as well as the frequent disruption of transactions, are mentioned as obstacles to mobile money payment and use.
In addition, in 2021, only 51 percent of Ethiopians have electricity, so the lack of electricity is another challenge to Ethiopia’s digital payment system.
Ethiopia’s participation in the cash payment system is very low compared to its neighbours in East Africa.
By 2022, more than 80 percent of adults in Kenya, 77 percent in Rwanda, and 66 percent in Uganda have a bank or mobile money payment account, according to the data.
On the other hand, in Ethiopia, banks, microfinance organizations and Ethio Telecom have provided mobile money services in Ethiopia since 2015.
According to the data released in 2022, only 9 percent of the population is using mobile money payment systems.
Currently, the government has made only digital payments for the purchase of fuel and traffic fines through a digital system.
In addition, they are being made to easily pay utility bills for water and electricity using the mobile banking applications of Commercial Bank and Tele birr.
The National Bank of Ethiopia granted a mobile bank license to Safaricom’s digital banking service platform, known as Mpesa.
