Looking back on Somalia’s first decade as a digital economy

By: Ahmed Mohamed Yusuf, CEO, Hormuud Telecom

In 2011, when we launched our digital payment platform EVC Plus, Somalia was a different place. We were just coming out of a protracted civil war, the streets in Mogadishu were dirt tracks, and not one high rise stood over the city. The population was a mere 10.00 million and only near 40% had a mobile phone.

Somalia had one of the lowest rates of financial inclusion in the world and only 70% of Somalis had an account with a financial institution in 2011. Mogadishu famously installed its first ATM in 2014 and whilst there are still problems around physical currency Somalia’s economy still has undergone a drastic change that has seen Somalia emerge as a world leader in mobile money.

This year we celebrate 10 years of EVC Plus Somalia’s first mobile money payment platform, which is now officially accredited by the Somali central bank. Its growth was instantaneous. By 2014, 40% of Somalis used EVC plus or other mobile money services. Now, nearly 80% of Somalis use mobile money every day, Mogadishu is a bustling modern city and the hub for Somali business. Our paved roads are lined with small and medium sized businesses, that make up the lion’s share of Somalia’s economy. EVC Plus has provided access to a formal banking infrastructure, that was desperately needed by businesses and consumers to elevate the country post-conflict. And now 10 years on, most of these companies rely on mobile money to conduct business.

This year, Hormuud also launched the WAAFI app, a global lifestyle e-wallet app for smartphone users. When I look upon the positive changes Somalia has undergone over last 10 years I am extremely proud. The fact that Hormuud’s products will help drive the next 10 years of Somalia’s development, with WAAFi and EVC+ at the forefront is a great pleasure.

However, Covid-19 severely impacted our daily lives. We were no different to the rest of the world, in that it drastically changed the dynamics of how business is conducted and disproportionately affected SMEs — the lifeblood of the Somali economy. Yet, testament to the financial infrastructure that the country has been building, we adapted. Mobile money became even more essential to how communities exchange, transact and ultimately keep the world-renowned Somali entrepreneurialism going cashless payments.

Case in point is the business account wallet offered through EVC Plus and Waafi.

At the time, we spoke with Abdulaziz Mohamed Nurani, founder of Tik, a premium men’s fashion retailer, who told us that “customers are now able to place orders and pay or them from their home via the app, and it eliminates the need for us to go the bank as we can access services through the app and keep track of payments. With this app I can check on my business and address any problems.”

Looking forward to the next decade, Hormuud’s goal is true that of ten years ago. Continue empowering Somalis through connection — we’ve got big ambitions for how to do so.

First of all, we’re committed to expanding highspeed digital infrastructure to all Somalis nationwide. Currently 54% of Somalis live in rural areas. 60% of rural populations have access to 3G and 50% of urban populations have access to 4G. Indeed, both are considered broadband-level service within frontier economies. Yet, affordable and reliable 4G should be the norm to optimise the use of EVC Plus, promote economic growth and drive financial inclusion across the board.

Secondly, we’re committed to increasing ease and speed of connections between Somalia and its diaspora. 10% of Somalis rely regularly on remittances and up to $2 billion dollars are sent to Somalia by the diaspora each year. This financial contribution shows great care for the Somali people from the diaspora and at Hormuud it is important that we continue to support this going forward through the Waafi App’s integrated remittance transfer service and through expanding our international calling infrastructure.

We look forward to the next 10 years of EVC+ and are excited to see where it takes Somali communities. Thank you for the last 10 years and here’s to another successful decade.