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 July 7, The 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.
Mahat Mohamed Ahmed,the IBS Bank Chief Executive Officer Speaking at the launch of this mega event he said that the introduction of Visa in Somalia was a great Milestone and that Somalia was on track to 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 pandemic.
“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 will now deliver Visa card services to bank clients in Somalia, which in-turn will boost 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.
VisaNet, Visa’s centralized processing network will be utilized in Somalia to help facilitate the transfer of value and information among Visa’s client financial institutions, consumers, merchants, businesses and government in a faster, more reliable and more secure way.
IBS is the first Somali bank that has introduced full banking products & services to cater for private, public, national & international clients and the first to have started the usage of The Swift Code and IBAN which are recognized worldwide. The bank recently joined the membership of the Union of Arab Banks.
IBS Bank is an International, Islamic, and Somalia’s premier global investment and commercial bank with an entirely Shari´ah compliant portfolio of products & services. IBS was incorporated in July 2013 and is licensed by the Central Bank of Somalia (CBS).