Low Data Cost Has Increased Financial Inclusion in Somalia

financial inclusion - cfamedia

Hormuud Telecoms, one of Somalia’s largest telecommunications providers has recently announced its financial inclusion aim to reach a100% of Somali’s populace through mobile money service.

In Somalia, the telecoms industry has seen a substantial rise in the past decade.

With more than 11 providers present in the East African country, Somalia boasts of the lowest cost of a 1GB mobile data bundle as compared to any other country in Africa.

After a long series of civil war, Somalia brings to bare a rare insight about the state of business in the East African country.

In the urban areas of the country, the penetration of mobile money at present stands at more than 80%.

Rural Somalia isn’t left out as the penetration rate spiked to 55%.

In 2018, a World Bank publication indicates three-quarters of the country’s population aged 16 and above make use of mobile money.

In comparison to Nigeria being the largest economy on the continent, less than 40% of the country’s adult population use mobile money accounts in 2018.

95% of Somalia’s local currency – the Somali Shilling – is said to be counterfeit, however, the adoption of the mobile money technology has given hopes to the re-emergence of business in the country.

It has also given rise to local investment, job creation and bridging the gender gap in Somali’s population financial life.

In a recent World Bank report, a first study show that when speedy internet service became readily available in Sub Saharan Africa, the chances of obtaining a job improved between 7% to 13%.

Another study indicated that, with fast internet, those who failed to finish their primary school have a high chance of securing employment.

Ahmed Muhamud Yuusuf, CEO, Hormuud, commented:

“It’s an incredible achievement that Somalia has one of the lowest data costs for countries in Africa.

And it’s a testimony to the huge strides that the country has taken to increase our digital infrastructure, making it easily accessible and affordable to the most vulnerable members in our communities,”

we will challenge ourselves daily to achieve this target, providing the best services and prices to our customers. The next step in our journey is to reach 100% of mobile money penetration.

We know that mobile money is vital to Somalia’s post-COVID development, allowing urban and rural communities to flourish, empowering the most vulnerable and widening financial inclusion.”

“More recently we’ve also seen how incredibly important access to telecoms and internet has been to public health during the COVID-19 outbreak.”

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