Copy right  2015 Central Bank of Somalia, All Rights Reserved.
Central Bank of Somalia Central Bank of Somalia provides the nation with safe, flexible and stable monetary & financial system.”

Payment

Systems

Overview

National   Payment   System   will   have   to   provide for    regulation    and    supervision    of    payment systems   and   payment   service   providers,   and for   connected   purposes.   CBS   is   in   the   process of    consulting    with    all    the    stakeholders    in drafting     the     National     Payment     System Regulations A    national    payment    system    is    one    of    the principal   components   of   a   country’s   monetary and   financial   system   and   is,   therefore,   crucial to   a   country’s   economic   development,   since almost     all     economic     transactions     involve some    form    of    payment.    Payment    systems refer      to      the      rules,      procedures,      and mechanisms   for   transferring   money   between two   or   more   financial   institutions   and   their customers. Besides    the    outright    cash    transactions,    the payment    system    in    the    country    is    fairly advanced   despite   the   absence   of   a   Central Monetary    Authority    over    the    past    fifteen years   of   civil   war;   thanks   to   the   investments in   telecommunications   network   by   the   private sector   that   have   enabled   operations   of   private remittance   companies   to   make   both   local   and international monetary transactions possible. The   remittance   companies   (Hawalas)   depend heavily    on    the    telephone    services    and    the remittance    and    telecommunication    services go    hand    in    hand,    as    transastors    call    each other   when   sending   and   receiving   monetary remittances. As   the   Central   Bank   of   Somalia   assumes   its monetary   policy   responsibilities,   some   of   the remittance       companies       (Hawalas)       are expected    to    seek    for    licenses    so    as    to graduate   into   full   fledged   commercial   banks in   the   near   future   and   thereby   broaden   the scope   of   payments   system   in   the   country   to include      cheques      which      will      reinforce effectiveness   of   use   of   monetary   policy   in   the macroeconomic management. Towards    fully    assuming    its    functional    and institutional    responsibilities,    the    Bank    has completed       the       reconstruction       of       its Headquarters   in   Mogadishu   while   the   branch in   Baidoa   has   been   established   and   is   already functioning with personnel in place. Well-designed       and       managed       payment systems   help   to   maintain   financial   stability   by preventing   or   containing   financial   crises,   and help   to   reduce   the   cost   and   uncertainty   of settlement,   which   could   otherwise   act   as   an impediment    to    economic    activity.    Payment and    settlement    systems    therefore    are    to economic activity as roads are to traffic
Copy right  2015 Central Bank of Somalia, All Rights Reserved. Central Bank of Somalia
“Central Bank of Somalia provides the nation with safe,       flexible and stable monetary & financial system.”

Payment Systems

Overview

National   Payment   System   will   have   to   provide   for   regulation   and   supervision   of payment   systems   and   payment   service   providers,   and   for   connected   purposes.   CBS is   in   the   process   of   consulting   with   all   the   stakeholders   in   drafting   the   National Payment System Regulations A    national    payment    system    is    one    of    the    principal    components    of    a    country’s monetary   and   financial   system   and   is,   therefore,   crucial   to   a   country’s   economic development,   since   almost   all   economic   transactions   involve   some   form   of   payment. Payment   systems   refer   to   the   rules,   procedures,   and   mechanisms   for   transferring money between two or more financial institutions and their customers. Besides   the   outright   cash   transactions,   the   payment   system   in   the   country   is   fairly advanced   despite   the   absence   of   a   Central   Monetary   Authority   over   the   past   fifteen years   of   civil   war;   thanks   to   the   investments   in   telecommunications   network   by   the private   sector   that   have   enabled   operations   of   private   remittance   companies   to make both local and international monetary transactions possible. The   remittance   companies   (Hawalas)   depend   heavily   on   the   telephone   services   and the   remittance   and   telecommunication   services   go   hand   in   hand,   as   transastors   call each other when sending and receiving monetary remittances. As   the   Central   Bank   of   Somalia   assumes   its   monetary   policy   responsibilities,   some   of the   remittance   companies   (Hawalas)   are   expected   to   seek   for   licenses   so   as   to graduate   into   full   fledged   commercial   banks   in   the   near   future   and   thereby   broaden the   scope   of   payments   system   in   the   country   to   include   cheques   which   will   reinforce effectiveness of use of monetary policy in the macroeconomic management. Towards   fully   assuming   its   functional   and   institutional   responsibilities,   the   Bank   has completed   the   reconstruction   of   its   Headquarters   in   Mogadishu   while   the   branch   in Baidoa has been established and is already functioning with personnel in place. Well-designed   and   managed   payment   systems   help   to   maintain   financial   stability   by preventing   or   containing   financial   crises,   and   help   to   reduce   the   cost   and   uncertainty of   settlement,   which   could   otherwise   act   as   an   impediment   to   economic   activity. Payment   and   settlement   systems   therefore   are   to   economic   activity   as   roads   are   to traffic
CONTACT INFORMATION P.O Box 11, 55 Corso Somalia Mogadishu, Somalia Tel/Fax: +2521241152, Tel: +2521866131 Tel: +2521866151 Email: it@centralbank.gov.so
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