21-01-2022 10:12:00 | by: Bob Koigi | hits: 614 | Tags:
Having undergone almost three decades in which there was no effective management over Somalia’s telecom sector, there have been considerable changes made in recent years according to a report by Research and Markets.
These have mainly been in response to the government, having been newly elected in 2017, being determined to promote ICTs and to bring the country into line with international developments.
This has been manifested in several ways, including the adoption of a National Telecoms Law, the creation of a regulator to oversee the sector, and the introduction of a licensing regime under which all operators must secure one of three types of operating licence.
If policed effectively, this should end the free-for-all of former years wherein it was relatively easy for companies to set themselves up and offer services. These efforts towards inclusion have also benefitted the country’s m-money providers. For many years, these services were unregulated and thus did not have the restrictions commonly applied by banks.
In addition, the poor currency conversion rate made it easy for locals to make transactions which would otherwise involve large amounts of currency. The Central Bank of Somalia (CBS) awarded a country’s first m-money licence (to Hormuud Telecom) in February 2021, though such services had already been available for about a decade.
The licensing regime has formalised transactions, and made it possible to integrate m-payments with the country’s own financial system and with international systems. The majority of adult Somalis use m-money services regularly.