November 1, 2009 ·1 Comments
Hargeisa, 1 November 2009 (Somalilandpress) — Dahabshiil, the largest international money transfer business in the Horn of Africa, has launched an “eCash” service that will enable Somalis to pay for goods and services at participating vendors, gas stations, hotels and restaurants.
Analysts say providing Somalis with the ability to make and receive electronic payments has the potential to revolutionize the way money is transferred.
“It’s a miracle, really just a major development,” Bashir Goth, a Somali analyst, blogger and the editor of Awdal News, told The Media Line. “Remember this is a country that for the time being doesn’t even have a banking system. Now suddenly people can have debit cards and within minutes Somalis overseas can send money home. It’s amazing and will facilitate a lot of business.”
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Ahmed Egal, a Somali businessman, agreed that the Dahabshiil move was a major event in Somali banking history.
“For someone in Somalia who gets a monthly transfer from someone abroad, this new debit card system can serve as an excellent way for the recipients to access the money,” Egal told The Media Line. “At the moment there are basically lots of female money exchangers who sit in the markets with huge stacks of cash. The benefit with this system will simply be not having to stand in long lines, and on the other end not having to wait to see if the funds have been received.”
Dahabshiil’s eCash service, initially launched in the breakaway Somaliland region, will provide Somalis with a card they can use to withdraw cash or electronically purchase various goods and services. While the initial launch focuses on larger consumer vendors with electricity and Internet access, Dahabshiil has plans to allow Somalis to use the service to pay Somali tuition fees. The system, which is encrypted and requires both PIN and signature authorizations, will be fully integrated with Dahabshiil’s already dominant global remittance system.
In a region with limited penetration of traditional banking, simple electronic money systems have grown recently in a number of east African markets, with a number of countries offering mobile services in which money can be sent, received and stored using cell phones.
No such services have reached Somalia, however, despite an estimated $1 billion sent to Somalis each year from family and friends in the U.S., UK, E.U. and the Gulf. The vast majority of that money is sent using Dahabshiil.
By Benjamin Joffe-Walt,The Media Line news agencyFollow @somalilandpress