Pioneering Fintech deal heralds new growth prospects in Ethiopia

Feb 23, 2018

Background to the deal

The Ethiopian Government retains control over the telecom sector and prohibits foreign ownership in both the financial services and telecommunications sectors. Having attained legal status, as a Value Added Service to these sectors, and having partnered with six financial institutions, M-BIRR required additional equity to facilitate an aggressive roll-out plan across Ethiopia

With this in mind, they approached a number of international banks to find a partner who would be able to assist them to raise this equity needed to facilitate both their growth ambitions and to support progress and development on the continent. 
Standard Bank was selected for our understanding of the market, our strong African footprint, and our ability to source international funding from the key markets that we are present in - including London, New York, Dubai, Hong Kong, Beijing and Sao Paulo.

As Exclusive Financial Adviser on the deal, we were able to attract investments from the European Investment Bank and the Deutsche Investitions- und Entwicklungsgesellschaft (the German Investment and Development Corporation).

Improving lives with technology

Despite being one of the world’s fastest-growing economies, aid funds still plays a key role in Ethiopia. Currently, the delivery of Aid funds to beneficiaries is a complex logistical exercise  involving cash, trucks and security to physically deliver funds to the remotest of areas. In turn, beneficiaries themselves often travel long distances to receive their aid funds which, if missed, may only be collectable again the following month.

The M-BIRR platform now plays a key role in solving this issue where it is used to transfer Aid monies benefiting more than 2 million people. Aid organisations and beneficiaries can now send and receive funds via a mobile phone where funds are now transferred electronically and cash withdrawn at any time via a network of agents and branches established by partnering financial institutions throughout Ethiopia.

Innovating Africa’s growth

This deal further demonstrates Standard Bank’s expertise in accessing International equity to support our African clients’ growth ambitions, while providing our international clients with investment opportunities in Africa that make a lasting commercial social impact.

If you are looking to grow in Africa, talk to us first. Our presence in 6 international locations and 20 African countries, enables us access to both regional and international funding to support our partners to realize their ambitions in strategic markets.

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