Somalia is open for business. MasterCard will become the first international payments network to enter Somalia, a country that hasn’t had a formal banking or financial system for over two decades since the collapse of its government in 1991.
MasterCard announced a partnership with Premier Bank which will issue 5,000 MasterCard debit cards this year, followed by prepaid cards and POS machines. This is a landmark move for the country’s unbanked population and a significant step toward financial inclusion.
“Somalia has made significant strides to rebuild the country and instil peace and stability. Today marks a historic milestone, signalling Somalia’s financial liberation following years of being excluded from participating in the global economy,” said Abdirahman Yusuf Ali Aynte, the Minister of Planning and International Cooperation of Somalia, in a news release.
The move to enter Somalia comes at a time when MasterCard is working closely with governments in Africa to help transition the economy from a solely cash-based one to electronic banking.
In March of this year, the company partnered with Microsoft to help Mexico’s financial inclusion efforts. MasterCard CEO Ajay Banga at the Mobile World Congress in Spain, noted that the company was looking at a number of private and public partnerships to this end.
Its competitor Visa isn’t just watching. It committed to the World Bank Group’s mission in aiming to achieve universal financial access by 2020 after World Bank Group’s 2014 Global Findex report showed that the number of unbanked adults globally dropped by half a billion from 2011 to 2014.
“In support of the World Bank Group’s objective of achieving universal financial access, we will work toward providing electronic payment accounts to another 500 million underserved people by end of 2020,” said Charles Scharf in a news release at the time.
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