Main trends

The most notable trend in the sector has been the tremendous rise of mobile money. Somalia is often referred to as one of the world’s first ‘cashless’ societies and mobile money has achieved significant depth and reach across the Somali territories with an estimated 73 percent of Somalis using it at least once a month (World Bank 2018). Mobile money transactions in Somalia have recently outpaced Kenya’s popular and sector leading MPesa. Mobile money is primarily exchanged in US dollars, a factor that has resulted from the complete collapse of the banking system after the fall of the national government in 1991.

Mobile money has reached beyond capital cities and is popular among nomadic traders in rural communities as well. Mobile money products in Somalia do not require smartphones, so many Somalis have access and also use the accounts to receive remittances, save money and pay regular expenses such as school fees. The spread has partly resulted from the conscious efforts of leading companies such as Zaad to create a mobile money ‘ecosystem’ where some leading companies, including the Coca-Cola bottling plant and Amoud University, became cashless, paying employees and conducting trade solely with mobile money. This forced others to quickly adopt for fear of becoming economically marginalized (Stremlau and Osman 2015). The strategy has been successful in making mobile money an integral part of the remittance industry (the largest contributor to GDP in the Somali territories) and an everyday tool for business.

The humanitarian sector has also influenced the development of mobile money and the digitalisation of information, as well as the content of paid radio programs and access to phones and usage by beneficiary populations. Some aid agencies, such as WFP, have used mobile money in their relief/resilience programming and as such they influence not only the registration to mobile money services by subscribers, but also motivate people to buy/own phones to assist them in participation in aid programmes and receive cash. Some agencies have also donated telephones as part of their programs to facilitate communication with beneficiaries enrolled in long term development projects. The use of biometrics is a growing area, with a highly ambitious experiment in biometric voter registration having occurred in Somaliland for the 2017 elections. Debates around privacy data storage have largely been missing. The widespread acceptance of Somalis to give their biometric data to international organisations, including the humanitarian sector, is notable.

Social media and apps such as Whatsapp, Facebook messenger and Viber are particularly popular. While web and app statistics vary, according to companies such as Alexa and Similarweb, Youtube and Facebook are the most popular sites (apart from Google), with and also receiving significant traffic. Uber-style taxi companies are also experimenting, with the launch in 2017 of Waryaa Taxi. There have been efforts to develop the startup sector, including through the Somali Accelerator, Innovate Ventures, which has provided some funding for new apps and companies.