- SantimPay facilitates over two billion birr in transactions per month
By Yared Seyoum
The financial technology sector in Ethiopia has seen incredible growth over the past few years as the country continues its rapid digitization. Mobile money accounts now number 68.7 million, surpassing cash-based transactions for the first time. It is within this dynamic environment that SantimPay Financial Solutions was founded just three years ago with a mission to simplify payments and facilitate Ethiopia's transition to a cashless society - "Santim" is the Amharic word for cent, the smallest unit of Ethiopia's currency the Birr.
Led by CEO Tinsaye Desalegn, SantimPay began as a small startup with just three founders - him, Professor Daniel Kitaw, and Abenezer Bekele. All had witnessed firsthand the inefficiencies that still plagued Ethiopia's nascent online payment ecosystem. As Tinsaye recalls, "we saw online merchants struggling with cash-on-delivery models. The payment ecosystem was not really facilitating digital commerce at scale."
Having developed e-commerce platforms and software solutions previously, the founders recognized the need for an innovative fintech solution to truly enable digital commerce at scale.
"We started out as a true startup with just the three founders and no outside funding," says Tinsaye. In those initial stages, one of their biggest early challenges was fulfilling regulatory requirements to obtain an operating license from the National Bank of Ethiopia (NBE). "One hurdle was needing to deposit over 13 million birr in a blocked bank account - no small feat for a new company with limited resources." By raising capital, SantimPay managed to sell 26 million birr worth of initial shares, depositing half into the required blocked account.
Beyond navigating the regulatory landscape, SantimPay's founders also had to grapple with financing, skills gaps, and gaining market traction in those early development stages.
Armed with the vision of capitalizing on problems plaguing the payment sector, SantimPay launched its first suite of products including a QR code payment modality, point-of-sale terminals, and a payment gateway. However, as with any startup, financing presented major challenges. "We wanted to truly enable digital commerce at every level through simple, affordable technology solutions tailored for Ethiopia," says Tinsaye.
Its initial products helped SantimPay gain traction within Ethiopia's fledgling digital finance sector. However, operational challenges emerged scaling nationwide as a startup. "Capacity was obviously limited with just three founders, so long hours were the norm developing everything in-house on a shoe-string budget," recalls Tinsaye.
Meanwhile, skills gaps posed difficulties recruiting talent to support SantimPay's technical infrastructure and growing user demands. "There were definitely growing pains expanding beyond our startup origins without external funding backing us up," says Tinsaye frankly.
Further hurdles included navigating regulatory knowledge gaps during the lengthy licensing process. But Tinsaye credits the National Bank for introducing progressive policies that are accelerating Ethiopia's fintech transformation. Where previously no framework existed, there are now many licensed fintech players contributing to a blossoming digital economy.
Tinsaye credited progressive steps by the regulator, stating that the "National Bank of Ethiopia is doing exemplary work. Policies that encourage digitization have been introduced by the regulatory body." He acknowledges that "it is commendable because digitization is happening now" through initiatives like dedicated fintech regulations.
Today, just one and half years after securing license, SantimPay facilitates over two billion birr in transactions per month. “With dozens of employees serving hundreds of merchants across the country, we have achieved profitability thanks to competitive pricing on products like their POS terminals,” the CEO said.
Constant innovation keeps them ahead, like integrating USSD and call center solutions to reach rural communities without internet or smartphones.
SantimPay's founders are now aiming higher, with plans to expand beyond Ethiopia's borders into neighboring markets like Djibouti, Sudan, Eritrea, and beyond. "We want to go beyond Ethiopia and become the leader in Africa’s digital payments market," CEO Tinsaye concluded. The coming years will demonstrate whether SantimPay can turn its continental vision into reality.
