M-PESA Ethiopia expands into tax collection with Amhara region deal

M-PESA Ethiopia has expanded into government revenue collection after signing a memorandum of understanding with the Amhara Regional State Revenue Bureau, allowing taxpayers in the region to settle their obligations via the mobile money platform.

The agreement, announced on March 21, paves the way for the over 450,000 individuals and businesses across Amhara to pay taxes through M-PESA, which relies on in-person services that have historically entailed manual processing and multiple visits to revenue offices.

“With this partnership, taxpayers in the Amhara Region will be able to make safe, fast, and convenient tax payments through M-Pesa from anywhere,” head of the Amhara Regional Revenue Bureau, Mengesha Fentaw, said.

The deal positions the Amhara bureau as the first regional tax authority in Ethiopia to integrate mobile money into its payment options. Mengesha said the move will ease administrative bottlenecks, strengthen record-keeping, and support revenue mobilisation.

Tax administration in Ethiopia has long relied on paper-based systems and fragmented processes, even as the government pushes forward with reforms to modernise public services and expand digital infrastructure. In recent years, mobile money services have gained ground, particularly since the entry of Safaricom Ethiopia into the market in 2022.

M-PESA’s tax collection deal follows user growth for the mobile money service in Ethiopia. According to Safaricom Ethiopia’s Q3 update for the period ending December 2025, the platform’s three-month active customers surged 258% year-on-year to reach 5.2 million. 

Transaction volumes nearly tripled to 364.3 million, while the value of transactions more than doubled to ETB 20.37 billion ($129 million), a deepening penetration following its integration with the national payments system, EthSwitch, in October 2025.

Safaricom Ethiopia’s larger operation has also picked up momentum, closing the quarter with 12.2 million three-month active customers, a 72%  increase from a year earlier. The company’s service revenue grew 54% to $74.7 million (KES 9.68 billion).