NAIROBI, Kenya, Sept 14 – Approximately 155 million mobile money transactions worth US$2.7 billion are conducted in Somalia every month, making it one of the most active mobile money markets in the world.
According to a World Bank finding, mobile money has superseded the use of cash in the country, with over 70 percent of adult Somalis using mobile money services regularly.
Somalia outpaces most African countries in the market, despite its fragility and underdeveloped financial institutions.
Lead ICT policy specialist at the World Bank Tim Kelly says private sector actors have given Somalia a unique opportunity to leapfrog towards widespread financial inclusion.
“World Bank will continue to support the partnership between the Central Bank of Somalia, the National Communications Authority and the key private sector actors as they deliberate on an appropriate regulatory framework for the sector,” Kelly said.
The country, however, lacks robust consumer protection and know-your-customer requirements.
The challenge for policymakers and regulators is how to mitigate system vulnerabilities and avoid macroeconomic effects in the event of service disruptions.
“Reducing costs and promoting greater stability is a top priority for the overall development agenda for the financial sector, ensuring that regulation does not stifle innovation by leveling the playing field is a very close second,” said Thilasoni Musuku, Senior Financial Sector Specialist at the World Bank Finance, Competitiveness and Innovation Global Practice.