Friday July 9, 2021
With peace and stability
returning to Somalia, the country is beginning to enjoy international
banking and financial services that can link the country to global
financial networks for ease of doing business, and also support the
growth of local industries.
On Wednesday, American digital
financial payments service Visa announced its partnership with the
International Bank of Somalia (IBS Bank), which will see the
introduction of Somalia’s first Visa financial card payment service.
This partnership opens up Somalia to the cashless payment services for
international and local transactions.
Speaking at the launch, IBS Bank
Chief Executive Officer, Mahat Mohamed Ahmed, said, “for Visa to come to
Somalia, it means that we are on the right path of growth and progress.
We’ll continue to make partnerships, and bring convenient and
innovative financial solutions to the people.”
The Visa Country Manager for Kenya,
Somalia and Eritrea, Eva Ngigi-Sarwari, said Visa cards offer safe
alternatives to physical handling of cash amidst an ongoing COVID-19
“The Visa card also offers access to a
global market, giving access to over 61 million merchant locations in
over 200 countries,” said Ngigi.
Through the partnership, IBS Bank can
now deliver Visa card services to bank clients in Somalia, which boosts
confidence in the Somali financial and banking sector.
In recent years, Somalia’s formal
banking sector has witnessed a resurgent growth in terms of customer
base and innovative products. In October 2014, the country’s first-ever
Automated Teller Machine was installed by Salaam Bank to facilitate cash
withdrawals for diaspora returnees and foreigners. Soon after, the
American electronic payments company Mastercard introduced its services
in Somalia with IBS and Premier Banks.
In recent years, Somalia has normalized
its relations with the International Monetary Fund, the World Bank and
other international financial institutions after 30 years outside the
international financial system.
“New players are coming on board now.
Two years ago, we had about five licensed banks, and today we are
talking of 13 licensed commercial banks. That goes to demonstrate the
appetite that is there,” Mahat said.
For many periods following the
collapse of the central government in 1991, the country’s financial
sector has been denominated by informal money-transfer companies, also
known as Hawalas.
According to Somalia’s Central Bank
Governor, Abdirahman Mohamed Abdullahi, the launch of Visa financial
cards links Somalia to the global financial system and signals growing
confidence in the country’s banking and finance sector.
“As the Central Bank of Somalia, we
plan to install an electronic verification system that will ease
biometric identification of customers opening bank accounts or
transacting in Somalia. We believe this will help to build international
trust and confidence in transactions originating from Somalia to other
financial markets,” said Governor Abdirahman.