Somalia to expand instant payment system linking banks and mobile money platform

The Central Bank of Somalia is moving to modernize the national financial landscape by expanding the Somalia Instant Payment System. This initiative aims to bridge the long-standing gap between commercial banks and mobile money platforms, which have historically operated on disconnected, closed networks. By creating a single interoperable infrastructure, the government intends to reduce transaction costs and bring more citizens into the formal financial sector.

Governor Abdirahman Mohamed Abdullahi noted that the fragmentation of payment systems has hindered economic growth for years. While the 2021 National Payment System addressed large-value interbank transfers, it lacked the functionality required for daily retail transactions. The new system, launched in 2025, utilizes ISO 20022 standards to ensure that transfers are instant and secure across all participating institutions.

Once the expansion is complete, the network will link 14 commercial banks and eight mobile money providers. This integration covers a broad range of services, including person-to-person transfers, merchant payments, and government disbursements. The inclusion of the SOMQR standardized code will also allow small, informal businesses to accept digital payments, a critical step for a country where these businesses drive much of the daily economy.

Looking beyond domestic borders, Somalia is positioning itself for regional integration. As a member of the East African Community, the nation plans to connect its payment infrastructure to the Pan-African Payment and Settlement System by the end of 2026. Finance Minister Bihi Egeh highlighted that these reforms are part of a broader push to improve economic governance and transparency. By prioritizing payment efficiency, the government expects to build a more resilient financial architecture that can better handle the significant volume of remittances flowing into the country each year.