Safaricom’s M-Pesa Ethiopia has reported restricted access to its newly launched financial services app, M-Pesa Lehulum, among users of the state-backed telco Ethio Telecom.

M-Pesa Ethiopia said customers using Ethio Telecom’s mobile data network were unable to log in or complete transactions on the platform, launched on December 1 as a network-agnostic spin-off of Safaricom Kenya’s M-Pesa.“M-Pesa Lehulum is currently not accessible on smartphones using mobile data services managed by Ethio Telecom, leaving our customers unable to log in, transact, or retrieve their funds,” the company said in a statement.

Lehulum was approved by the National Bank of Ethiopia and the Information Network Security Administration, the country’s signals-intelligence agency. M-Pesa Ethiopia said it was engaging regulators to resolve the issue.

Ethio Telecom had not responded to The EastAfrican’s request for comment by press time.

Safaricom introduced M-Pesa services in Ethiopia in August 2023, 10 months after launching voice and data services in the country, as Addis Ababa opened the tightly controlled economy to foreign competition.

Lehulum’s entry marked a major step in the country’s digital payments landscape, allowing any mobile user, regardless of their network operator, to download the app and use M-Pesa services.

This includes sending and receiving money, making payments, and accessing digital financial tools — services that have helped M-Pesa grow in double digits in Kenya since its 2007 launch, on course to generate half of Safaricom's revenue.

The company’s 2026 half-year financials, released in November, show a 52.1 percent rise in profit to Ksh42.7 billion ($330 million), helped by a smaller loss in Ethiopia and M-Pesa's growth.

The telco’s revenue rose to Ksh199.9 billion ($1.55 billion) in the six months to September, from Ksh179.9 billion ($1.39 billion) in the same period a year earlier, reflecting an 11.1 percent growth.

In Ethiopia, Africa's second-most populous country, Safaricom had 11.15 million subscribers as of September. Most of the country’s M-Pesa subscribers use it for data and airtime purchases, unlike in Kenya, where cash transfers and merchant payments make up the majority of transactions.

M-Pesa competes with Ethio Telecom’s Telebirr, launched in 2021 and now offering savings and micro-credit services. Telebirr has a significant first-mover advantage and the largest user base, with 52.56 million of the network’s 83.2 million customers as of June.

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