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Somalia determined to implement a new monetary system

by Communication Team | Mar 07, 2017

SomaliaSince the collapse of the government and the beginning of the civil war in 1991, Somalia was left without a conventional monetary system. Indeed, the only banknote currently available is the 1,000 shilling and monetary transactions are exclusively made in dollars.

Nevertheless, Somalia is committed to ensuring greater financial stability and is willing to implement a monetary policy. The government is also determined to print its first banknote series in over 25 years thanks to the support of International Monetary Fund (IMF) and the World Bank. The decision to issue a new currency is welcomed by the observers, but the country will first need to establish new banking partnerships as it currently supervises only 6 banks and 12 money transfer entities, mainly located in the capital.

Somalia is considered one of the most active mobile money markets in the world with 37% of the population using e-payment services on their mobile phones. Users can pay bills, purchase goods and transfer money via their mobiles. Despite the efficiency of this payment system, the government hopes to ease the grip telecommunication companies have on the economy via a new monetary policy which includes the issuance of a new banknote series.

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