Bloomberg reported that the Somali Bank of Peace, in partnership with Visa, is set to launch a plan to transfer financial payments in Somalia electronically by providing prepaid cards.
This initiative aims to enhance the speed and security of transactions, while providing appropriate support to the large number of unbanked population in the country.
Although only 15% of Somalis have bank accounts according to a UN report, introducing these Visa cards could be a game changer.
The new debit card is the first of its kind to be linked to the point-of-service systems of Somalia’s largest bank, allowing businesses to use it across the country.
These cards can also be used at ATMs and in e-commerce transactions, expanding access to financial services for many Somalis.
Distribution of humanitarian aid
Prepaid cards are particularly important for the humanitarian needs in the country, where an estimated 7 million Somalis are in need of humanitarian assistance, and these cards are expected to simplify the process of distributing aid to vulnerable communities and vulnerable groups.
“The cards will enable international NGOs to distribute aid directly to pre-identified beneficiaries,” the Somali Peace Bank said.
Expanding digital banking services
Al Salam Bank Somalia has seen significant growth recently, adding 40,000 new customers over the past year and processing 40,000 transactions daily through its mobile banking service.
The bank aims to build its transaction capacity to meet the demands of a rapidly growing population and economy that the World Bank expects to grow by 3.7% in 2024.
This partnership and the introduction of Visa cards are steps towards modernizing Somalia’s financial infrastructure. By facilitating digital payments, the initiative supports economic growth and provides a reliable means of delivering humanitarian assistance. This development represents a major step forward for Somalia in line with global trends towards digital financial inclusion.
