The National Bank of Ethiopia has supplied its first-ever Fintech license to ArifPay. They offer a universal, mobile point of sales platform connecting banks, customers and merchants. Millions of users have since registered, and ArifPay is looking forward to massive trade. It will also be revolutionary for the Ethiopian betting and gaming industry. Now, this sector is getting attention from bookmakers, investors and stakeholders interested in the potential of this market.
The Directive & Licensing Process
Many issues needed addressing to secure the license. The directive stipulated requirements linked to capital and the nationality of investors. The technological know-how was another prerequisite and a cohesive business plan needed presenting too.
There were also many options for payment system operators included, such as:
- Non-financial institutions with services around cards and PoS machines must have a licence issued by the Central Bank. Applicants also need paid-up capital of Br300 million.
- Br40 million for national and local switch operators is required.
- Automated teller machine operators need Br20 million and PoS device operators must pay Br10 million.
- Br3 million is the cost payment gateway operators will need to cover.
CEO Comments on the Licence
Habtamu Tadesse is the Chief Executive Officer and founder of ArifPay. When commenting on ArifPay getting the first NBE Fintech permit he said that it will allow his business to start providing gateway services along with various payment systems operations.
ArifPay may have paid as much as Br140 million for the license that will pave the way for the company as a gateway service and private payment systems operator. The services it offers include a way to pay taxes, create invoices, and transfer money.
Tadesse added that his company had begun the permit application process as soon as it could, which was roughly one year ago. The company used the fresh directive on payment instrument issuers that allowed non-banking institutions like mobile network operators to make money services available.
Tadesse continued to say that his firm applied for and secured permits for operating a payment system. This, along with providing gateway services, cost a sum total cost of Br13 million. However, this was not enough to get the business running. ArifPay promoters and its 40+ shareholders collected Br140 million paid-up capital.
No formal regulation exists for Ethiopians and online gambling. However, the National Lottery Administration has certain laws which impact this and its capacity for licensing games could well affect this status quo. The NLA has had the authorization to run activities besides the Lottery since 1961. This is along with overseeing other entertainment. The list includes Bingo, Billiards, Poker, various casino games, and Video Poker.
This milestone event is a thrilling development for already-established bookmakers who can now switch their strategy. Instead of focusing on retail, they can emphasize mobile access. This will no doubt see the implementation of an extra force in the market and operators will see a stream of bettors switching to online gambling.
The Ethiopian market seems ready to go the same way as the Kenyan sector. Kenya’s online betting sites have increased, along with the mobile bettors. This pattern is sure to happen in Ethiopia too. The Ethiopian market is already opening, and this trend will likely continue.
The government’s commitment to embracing technological developments will see the digital economy benefit. This is excellent news for the country as businesses are encouraged to invest. A range of industries will be affected for good – with sports betting benefitting greatly.