Ethiopian Law On Banking Sector Liberalization: Licensing Requirements For Foreign Banks

The banking business sector in Ethiopia was exclusively reserved for domestic investors for a half century. The sector began to be opened to foreign investors since 2023. In 2023, the Ethiopian parliament promulgated the National Payment System Amendment Proclamation No. 1282/2023, which liberalized digital payment services (including mobile money and payment system operator services) to foreign investment. Following such liberalization, Safaricom M-Pesa Mobile Financial Service Plc became the first foreign investor to invest in mobile financial services. The National Payment System Amendment Proclamation only opened the digital financial services to foreign investment, leaving the broader banking sector closed to foreign investors.