Somalia - Country Commercial Guide
Banking Services and the Financial Services
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Somalia’s financial and banking sector is developing and building systems with the goal of meeting international standards necessary for correspondent banking relationships.  Total sector assets are equivalent to about 4.3 percent of GDP.  Credit to the private sector is about 1.3 percent of GDP.  Mobile money is widespread and estimated at 73 percent penetration.  According to a World Bank report, Somalia diaspora remittances are estimated at $2 billion annually.

Thirteen licensed banks are active in the country, the largest of which include the International Bank of Somalia (IBS), Premier Bank, Salaam Somali Bank, Dahabshiil International Bank, and Amal Bank.  Seven money transfer businesses, popularly known as “hawalas,” are licensed to transfer and receive money through informal networks and channels.  Three licensed mobile payments services providers are linked to the biggest of seven mobile network operators.  Financial services are dominated by informal conglomerate groups, each containing a bank, money transfer business, mobile payments services provider, and mobile network operator.  Most banks use “Islamic models” to offer commercial retail banking, trade finance, and investment services.

Access to financial services is low and largely confined to urban areas.  Somali incomes are generally low, with 55 percent of households supported by remittances, mainly through hawalas and mobile payment service providers.  Eighty-five percent of adults have a mobile phone, and 82 percent of adults use a mobile phone for financial transactions, typically mobile payments.  Less than 9 percent of adults have a bank account, mostly in urban and rural (fixed agricultural) areas, with minimal access to banks in nomadic (herding) areas.  Only 26 percent of households have loans, mostly from merchants and traders, with only 2 percent from banks.  

Remittances are a significant part of Somalia’s economy.  According to the Somalia integrated household budget survey in 2023, nearly one in five households (20.7 percent) received remittances from someone living outside the household, within Somalia or abroad.  By place of residence, about a quarter of urban residents and rural residents (23.8 percent and 21.7 percent respectively) rely on remittances, compared to 11.9 percent among nomadic households.  Remittances are commonly transferred through hawala (55.4 percent) and mobile money (41.5 percent) methods.  Urban areas use Hawala transfers (62.0 percent) more than others, while mobile money methods are more often used by nomadic (72.3 percent) households.  Rural households rely on both Hawala and mobile money.

In August 2021, Somalia’s central bank launched “National Payment Systems” that included electronic payments, clearing, and settlement systems, enabling the central bank to conduct open market operations and transmit monetary policy.  Most domestic payments are now made using mobile payments and bank transfers denominated in U.S. dollars.

Tighter anti-money laundering and countering the financing of terrorism (AML/CFT) regimes have been put in place as many Somali banks seek to come into full compliance with international standards.  The Central Bank of Somalia has AML/CFT oversight of the new payment system.  This oversight seeks to reassure foreign regulators and banks about the appropriateness of payments sent to Somalia. The first mutual evaluation of Somalia’s AML/CFT compliance will take place in 2024.

Most Somalia banks are expanding and seek new capital and investment through equity investments, development of core banking tools and books of business, improved financial management systems, credit and loan services, and other financial services products.

Information Resources

Somalia Bankers Association

Safari Apartment Zoope, Hodan District


Telephone: +252-61-169-3020


Central Bank of Somalia

Corso Somalia 55, PO Box 11, Mogadishu - SDR, SOMALIA

Telephone: +252-1216416