Ethiopia’s multi-billion-dollar remittance sector is under renewed scrutiny as authorities intensify their crackdown on illegal money transfers and cryptocurrency operations.
The National Intelligence and Security Service (NISS) yesterday confirmed the arrest of 112 suspects, including both Ethiopian and foreign nationals, and the freezing of 519 bank accounts linked to money laundering, unlicensed remittance operations, and tax evasion.
According to the World Bank, Ethiopia’s remittance inflows are worth over US$5.6 billion annually, making them one of the country’s most critical sources of foreign exchange.
The Ethiopian diaspora, estimated at more than 3 million people, sends home an average of US$450 500 million per month, much of it through informal channels.
The Ethiopian Business Review reported that the NISS coordinated operation, conducted with the Financial Security Service and the Federal Police, targeted illegal hawala networks, unlicensed foreign exchange dealers, and cryptocurrency-based transfers that bypass the National Bank of Ethiopia (NBE)’s regulatory system.
“These illegal activities continue to cause significant damage to the country’s economy and are used to support terrorists and armed groups,” NISS said in a statement, warning that investigations will continue.
Legally, Ethiopia’s official remittance sector is dominated by licensed fintech firms such as Telebirr, Safaricom’s M-Pesa, EthSwitch, Dahabshiil, Western Union, HelloCash, and Amole, which operate under strict oversight from the NBE.
All remittance operators are required to hold valid licenses, adhere to Anti-Money Laundering and Combating the Financing of Terrorism rules, and report regular transaction data to regulators.
NBE Governor Eyob Tekalign recently issued a strong warning during the IMF–World Bank meetings in Washington when he stated that the National Bank of Ethiopia is already using its monitoring and investigation systems to identify unlicensed operators and will take firm legal and regulatory action to protect the country’s financial interests.
“The National Bank will take strong enforcement measures against those who continue to conduct money transfer activities illegally,” he said.
He emphasised that operators transitioning into formal compliance frameworks will receive regulatory support.
The central bank has urged individuals and businesses to use only authorized channels, verify operators’ licenses, and report suspicious activity. For legitimate players, the crackdown presents an opportunity to expand market share as informal systems collapse.
The Central Bank believes formalising remittances will strengthen Ethiopia’s foreign currency reserves, improve policy planning, and attract foreign investors.
“A transparent and well-regulated remittance market not only protects consumers but also anchors economic stability,” said Tekalign.
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