Safaricom’s M-PESA has forged a significant partnership with Onafriq, Africa’s leading digital payments network, aimed at enhancing remittance flows to Ethiopia. Through this collaboration, M-PESA users within Ethiopia will be able to receive remittances from various parts of the globe seamlessly.
This strategic move by M-PESA aligns with the growing demand for efficient international money transfer services, especially in regions like Ethiopia, where remittances play a pivotal role in the economy.
Tech Point Africa, in its report on the inaugural International Day of Family Remittances held in East Africa in 2023, quoted Mohammed Endris, the Director General of the Ethiopian Diaspora, revealing that remittances constitute up to 50% of the GDP in certain nations.
Highlighting the significant financial contribution of African immigrants to their home countries, the World Bank reported remittance inflows into sub-Saharan Africa totaling $53 billion in 2022.
However, Endris emphasized that remittances to Ethiopia represent only 5% of the country’s GDP, with plans in motion to double this figure within the next five to seven years.
The anticipated collaboration between Onafriq and M-PESA is anticipated to bolster Ethiopia’s remittance landscape, aiming to increase the flow of funds into the country. In 2022, Ethiopians residing abroad remitted a total of $4.2 billion to their homeland.
By integrating international money transfer capabilities into its platform, M-PESA leverages Onafriq’s expansive network, linking 500 million mobile money wallets and 200 million bank accounts across the continent.
Paul Kavavu, General Manager at Safaricom Ethiopia, emphasised the significance of this partnership in simplifying payments and providing the Ethiopian Diaspora with a reliable channel to send money back home.
With Ethiopia receiving over $5 billion in remittances annually, the collaboration with Onafriq is poised to enhance financial inclusion and support the country’s digital transformation agenda.
Nika Naghavi, Group Head of Growth at Onafriq, echoed this sentiment, emphasizing the importance of seamless payments and increased access for individuals across Africa.
The partnership with M-PESA Safaricom not only expands Onafriq’s reach but also strengthens its position as the largest payment network on the continent, contributing to economic growth and sustainable development goals in Ethiopia and beyond.
