Central bank of Somalia launches QR code standard for financial transactions
The launch of a QR code standard is the latest sign that Somalia intends to rebuild its financial services infrastructure, hindered by years of conflict. In March 2023, the CBS also announced the adoption of International Bank Account Numbers (IBAN) by all banks in the country, reducing operational risks for banks.
The Central Bank of Somalia (CBS) has launched a Quick Response (QR) Code standard to drive the growth of the financial services sector. The launch is the latest sign that Somalia is attempting to rebuild its financial services infrastructure, which has been hindered by years of conflict.
The CBS has introduced a national payments system to drive interoperability among the 13 lenders in the country as well as adopted International Bank Account Numbers (IBAN) to reduce operational risks for banks.
Mobile network operators are also providing a respite through mobile money services, which account for two-thirds of payments made in the country. Despite these efforts, only 10% of Somalis held accounts in formal financial institutions in 2021 and only 2.8% had savings at a formal financial institution.
It is yet to be seen how successful the QR code standard will be in driving digital payments in the country, given the low levels of internet and smartphone penetration. The government should continue to build solutions that digitise payment systems to further drive the growth of the financial services sector.
About author
DW Team
The GIP Digital Watch Observatory team, consisting of over 30 digital policy experts from around the world, excels in the fields of research and analysis on digital policy issues. The team is backed by the creative prowess of Creative Lab Diplo and the technical expertise of the Diplo tech team.