EthSwitch Rides P2P Wave as Profits & Expenses Reach Historic Highs

For the fiscal year ending June 2025, EthSwitch, Ethiopia’s national switch operator, reported a record gross profit of 1.4 billion Birr, a 34% increase from the previous year’s 1.06 billion. Interoperable transaction fees remained the backbone of EthSwitch’s income, with person-to-person (P2P) transactions generating 902.6 million Birr, nearly half (49.9%) of operational revenue and up 123% year-on-year, while ATM transactions contributed 825.1 million birr, or about 45.6% of operational revenue.

Net profit neared 1.05 billion Birr, reflecting both robust growth in digital transactions and mounting cost pressures.

Total revenue climbed 49% to 2.2 billion Birr, driven by a surge in interoperable payment activity. EthSwitch processed 287.4 million interoperable transactions worth 741.1 billion Birr during the year. Person-to-person transfers, the fastest-growing category, jumped 158% to 128.3 million transactions, with a flawless success rate and a transaction value of 577.7 billion Birr.

ATM and point-of-sale transactions also continued their upward trajectory, expanding 26 percent and 27% respectively. Together, they reinforced EthSwitch’s position as the backbone of Ethiopia’s increasingly digital financial ecosystem.

Still, not all numbers pointed upward. Earnings per share fell to 486.14 birr from 551.62 birr, a decline tied to an expansion in the company’s share base following recent capital increases.

Beneath the strong top-line growth, rising operational costs cast a shadow. Operating and administrative expenses nearly doubled, soaring 89% to 746.2 million Birr. Foreign-exchange losses, fueled by continued volatility in the local currency, further eroded margins. Net income after tax, though up in absolute terms was tempered by these pressures, underscoring the thin line between rapid expansion and sustainable profitability.

At the company’s 12th annual shareholders’ assembly, held at the Sheraton Addis Hotel, Solomon Desta, Board chairman of EthSwitch and the central bank’s VP, struck a note of optimism. He pointed to the acquisition of a new 12-story headquarters and the relocation of the firm’s data center to a Tier III facility at Zemen Bank’s headquarters, a technically complex move completed without service disruption.

“These investments reflect our commitment to operational excellence, innovation, and supporting Ethiopia’s digital financial transformation,” he told shareholders.

Chief executive Yilebes Addis acknowledged the challenging macroeconomic backdrop but emphasized resilience. “EthSwitch’s innovation has enabled us to deliver secure, reliable digital payment services nationwide,” he said. “Our focus remains on expanding interoperability and empowering all Ethiopians.”

In parallel with its financial growth, EthSwitch made notable strides in technology and product development. The company migrated to a software-defined network architecture and launched an OpenStack-based private cloud changes that enhance scalability, resilience, and cybersecurity.

It also rolled out new services, including Green PIN, a platform for secure ATM PIN management, and interoperable cardless cash withdrawals, features designed to increase convenience and safety for users. Progress continued on the long-anticipated Instant Payment System, which will support interoperable QR payments and “Request to Pay” functionalities. A shared-wallet pilot now under testing could further streamline transactions across banks and mobile operators.

EthSwitch sits near the center of Ethiopia’s digital payments transformation, a sector that has become increasingly vital as banks, fintechs, and telecoms race to capture new users. The integration of the national digital ID, Fayda, for account opening and KYC processes is also a key priority, hoping to further streamline financial inclusion.

Yet, the company’s growth story carries cautionary notes. Total assets expanded 41 percent to 4.9 billion birr, and subscribed capital approached 3 billion birr, signaling robust shareholder confidence. But the sharp rise in expenses and foreign-exchange losses underscores the vulnerability of digital infrastructure expansion in a turbulent economic climate.