Dollarized mobile money payments via Hormuud Telecom's EVCplus / Sahal / Zaad networks are dominant, and mobile coverage is pretty extensive. They have an API and a full Islamic commercial banking infrastructure.
I have more personal experience in the Republic of Somaliland, which is a de-facto independent state in the north. In Somaliland, the government set a regulation that requires all mobile money transactions < $100 USD to be done in Somaliland Shillings. Somaliland Shillings are often used as change in any small USD cash transactions. The Somaliland Shilling is pretty stable. It was trading at ~9600 / USD last spring, and I don't think it has moved much since then.
Regularly transacting in physical USD is a huge pain because people will only accept virtually perfect bills with the latest design. It makes sense to an extent because it's costly to replace damaged bills.
Dollars are and will continue to be a huge part of Somali trade - the Somali diaspora and business community regularly trade in Ethiopia, Kenya, and beyond. I don't think you'll find anybody using Somali shillings in Somaliland either. There's also limited value / opportunity for any constructive monetary policy because there's very little conventional debt or interest. I agree with the author that there might be some value in introducing local coinage for small transactions, but anything more is likely to be counterproductive.
- shameless plug to anyone at YC - take a look at my S24 application and you can see a website that uses the Hormuud mobile money API. Email and I'll give you some more test info for this payment flow (it's not in the demo)
- If you're really interested in mobile money APIs or payments in Somalia, I'll share more if you email my handle @gmail.
When people elsewhere talk about Somalia, they usually include Somaliland in that definition, international recognition of the latter being what it is.
It's all very silly IMO given that Somaliland has been de facto independent for over 30 years now, and is the most functional part of the former Somali Republic.
I'm from neither. I've personally traveled in and around Hargesia so I have more hands on experience with payments there as a consumer vs. Mogadishu and surrounding areas.
I have more personal experience in the Republic of Somaliland, which is a de-facto independent state in the north. In Somaliland, the government set a regulation that requires all mobile money transactions < $100 USD to be done in Somaliland Shillings. Somaliland Shillings are often used as change in any small USD cash transactions. The Somaliland Shilling is pretty stable. It was trading at ~9600 / USD last spring, and I don't think it has moved much since then.
Regularly transacting in physical USD is a huge pain because people will only accept virtually perfect bills with the latest design. It makes sense to an extent because it's costly to replace damaged bills.
Dollars are and will continue to be a huge part of Somali trade - the Somali diaspora and business community regularly trade in Ethiopia, Kenya, and beyond. I don't think you'll find anybody using Somali shillings in Somaliland either. There's also limited value / opportunity for any constructive monetary policy because there's very little conventional debt or interest. I agree with the author that there might be some value in introducing local coinage for small transactions, but anything more is likely to be counterproductive.
- shameless plug to anyone at YC - take a look at my S24 application and you can see a website that uses the Hormuud mobile money API. Email and I'll give you some more test info for this payment flow (it's not in the demo)
- If you're really interested in mobile money APIs or payments in Somalia, I'll share more if you email my handle @gmail.