Ethiopia's Ethio Telecom intends to venture into the mobile money transfer market as part of its ambitious growth strategy, in terms of which the company aims to generate $1.4-billion in revenue by 2023.

The company, which is gearing up for privatisation and whose monopoly is set to come to an end with the opening up of Ethiopia’s telecommunications industry to competition, has announced it has received approval from the National Bank of Ethiopia (NBE) to venture into the financial services sector.

This comes after the NBE issued a directive dubbed the Licensing and Authorisation of Payment Instrument Issuers, which allows transactions to be performed through mobile phones after customers deposit a sum of money with an agent.

“By engaging in new business streams and shifting revenue sources from traditional to value-added services and by offering 14 new and 21 revamped local and international products and services, Ethio Telecom aims to generate Birr55.5-billion in revenue,” says the company in its 2020–2023 Growth Strategy.

In the financial year ended June 2020, the company generated $1.2-billion in revenue.

After decades of locking out foreign companies, the Ethiopian government has decided to end the long-held monopoly of Ethio Telecom by not only selling a 40% stake in the operator to foreign investors but also issuing two new licences.

In November, the Ethiopian Communications Authority issued a request for proposals for the two licences, targeting world-class telecommunications operators.

Twelve companies, among them South Africa’s Telkom and MTN, have indicated they are keen to enter the Horn of Africa nation.

Although Ethiopia intends to open up the lucrative sector, foreign companies will not be allowed to engage in mobile money services in the immediate future.

The Ethio Telecom growth strategy aims to address ever-changing customer demand, digital inclusion to create a better digital economy, enhance productivity, and shift revenue generation from traditional streams to value-added and content-driven services.

Through the strategy, the telco aims to increase the number of subscribers by 13% to 51-million, mobile voice subscribers by 11.8% to 49.7-million, data and Internet users by 16.5% to 27.47-million and fixed broadband subscribers by 215.3% to 669 400.

This is expected to bring telecom penetration in Ethiopia to 51.3% from 45% currently.

At present, the company has a total of 46.2-million subscribers, 44.5-million mobile voice subscribers, 23.8-million data and Internet users, and 212 200 fixed broadband subscribers.