In a significant policy update, Ethiopia's National Bank has expanded the caps on mobile money transaction and balance limits. The Payment Instrument Issuer Directive now sets the daily electronic account balance limit at 75,000 birr, more than double the previous 30,000 birr ceiling.
Daily aggregate transaction volumes are also increased, with a new threshold of 150,000 birr. The directives aim to stimulate greater adoption of digital payments nationwide, especially beyond major urban areas.
The Bank credits the changes for "keeping up with market developments while still safeguarding consumers." Specific transaction types like bills, taxes, travel, and fuel purchases will not be subject to the increased ceilings, facilitating common digital payment uses.
A well-functioning mobile money service can reduce transaction costs, facilitate e-commerce, enhance the security of financial transactions, and minimize the amount of currency in circulation, according to a statement released by the central bank on October 9, 2023.
Mobile money providers additionally have the right to offer capital market products, according to the new directive.
In another major change, banks can also establish standalone subsidiaries focused solely on mobile money services.
