In the fast-growing financial sector in Ethiopia one lesson rings clear: If you’re a fintech aiming to survive, steer as far as possible from the path taken by SunPay Solutions S.C. The fintech startup, with lofty ambitions and ties to one of Ethiopia’s largest conglomerates, has become an exemplary tale after the National Bank of Ethiopia (NBE) recently pulled the plug on its operations for a staggering array of violations. The fintech’s failure is not just a blow to its own reputation but a red flag for any startup thinking regulatory compliance is just paperwork.

SunPay Solutions, an affiliate of the Sunshine Investment Group — owned by the prominent Tafesse family — entered the fintech scene with high hopes. It had plans to revolutionize Ethiopia’s digital payments landscape, promising seamless transactions and financial inclusion for all. Yet, as the ink on their press releases dried, their operational deficiencies began piling up.

A License Too Soon, Too Late to Perform

Two years ago, SunPay Solutions received a pilot permit from the National Bank of Ethiopia for payment system operations and POS services. That permit, meant to be a temporary stepping stone for the company to prove its worth, seems to have been treated more like a free pass. From the moment the ink dried on the pilot permit, SunPay went silent. No progress reports were filed, no updates were sent to the regulators. One might have thought the company went into stealth mode, but in reality, it was simply dormant.

The fintech’s transgressions were many and varied. According to a letter written by Solomon Damtew, Director of the Payment & Settlement Systems Directorate at NBE, SunPay failed to appoint a CEO — an oversight that might seem like a small administrative matter until you remember that the CEO is supposed to be the one steering the company. There was also the minor issue of not renewing its license — a process akin to forgetting to renew your passport right before an international trip.

Add to this the inability to maintain a physical presence (a requirement for fintechs in Ethiopia), and SunPay’s refusal to conduct a shareholder meeting, and you’ve got a recipe for regulatory disaster. These aren’t just missteps; they’re flagrant violations of the NBE’s directives, the country’s Commercial Code, and the National Payment System Proclamation. And when you flout the rules this blatantly, it’s only a matter of time before the Central Bank steps in.

Grand Ambitions, Small Payments

SunPay’s downfall wasn’t just about regulatory negligence. The company’s handling of day-to-day business affairs also left much to be desired. Yonas Samuel, the youngest son of Sunshine Investment Group’s patriarch Samuel Tafesse, was the key figure behind SunPay’s entry into the fintech space. His ambitions stretched far beyond payments — he envisioned a tech empire that would also branch into ride-hailing, delivery services, and even e-commerce. But as those dreams soared higher, the company’s ability to manage its basic obligations plummeted.

Last year, SunPay’s failure to settle a $3,000 invoice to a small contractor made headlines. According to credible sources, the company signed a contract, stamped it with all the official pomp of a legitimate operation, and then proceeded to ignore repeated requests for payment. Despite multiple attempts to settle the bill, the contractor was met with excuses ranging from “I’m out of town” to “someone else is handling it.” If SunPay can’t manage a four-figure invoice, how exactly does it plan to manage the money of thousands of Ethiopian customers? The creditor lamented. 

On paper, the company claimed it had raised an initial capital of 100 million Birr (about $1.85 million). 

The lesson here is painfully clear: in Ethiopia, compliance isn’t optional, even for companies with deep pockets, influence and big ambitions.

And for Yonas Samuel, the man behind the Sunshine Group’s tech ambitions, SunPay’s failure is a bitter pill to swallow. The fintech, once heralded as a major step forward in Ethiopia’s digital payments sector, is now a symbol of what happens when ambition outpaces execution.

As the fintech ecosystem in Ethiopia continues to grow, SunPay ’s experience should serve as a reminder to startups: follow the rules, pay your invoices, and of course, never forget to renew your license. If not, the central bank’s next revocation letter might have your name on it.