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The Central Bank of Somalia (CBS) recently announced the setting up of a national payments system which it says will enable the country’s 13 lending institutions to transact with each other. The system is also expected to help facilitate more efficient transactions between vendors and their customers.
Boost to Somalia’s Financial Inclusion Cause
According to a report, under this so-called national payments system, the CBS will “connect lenders to a clearing and settlements platform to enable them to process real-time money transfers.” Interoperability capabilities for debit and credit cards, mobile network operators, and automated cash machines will also be enabled.
The report also quotes the CBS governor, Abdirahman Abdullahi, outlining the other benefits of having such a payments system. He said:
[The system] will enable more financial inclusion in a secure and safe manner. The impact on the economy will be unprecedented. It will boost trade and business.
New Somali Shilling Notes Planned
A national payments system also bodes well for the war-ravaged nation’s financial sector, which of late has seen new developments such as the launch of a Visa card in July by the International Bank of Somalia. The issuing of the first mobile-phone-based financial-services license to Hormuud Telecom by the central bank is another milestone for Somalia.
The central bank is also reportedly looking to print new Somali shilling notes which will replace “the few genuine notes in circulation [that] are old and dirty.” Presently, many Somalis prefer using the U.S. dollars ahead of the local currency as the latter is prone to counterfeiting.
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