Somali payment system attracts attention from a strange source

A recent statement released by a Somali rebel group, al-Shabab and carried by Reuters was reported on widely. (Read here and here, amongst others). According to the statement, al-Shabab states that the the local mobile payment system (referred to as Zaad) is a threat to the local economy and must be discontinued by the end of the year. This story was distributed widely by an eager western press. In the eyes of many, Somali is a country of pirates with an economy based on extortion. Nothing can be further from the truth.

The condemnation of the Somali government of the ban by the rebel group was not reported on at all. (Read here). In the press release the government shows much support for the mobile banking service, highlighting the huge benefits provided by the service to the population of Somalia. Furthermore, little gets reported on the strong economy of the country based on agriculture and diaspora all over the world remitting money back into the country. The economy is not performing optimally because of the instability created by rebel groups, but is reported to be growing at rates of 4% per year. Not too bad for any country. GDP per capita is about $330 which is only slightly lower than Kenya, but higher than Tanzania for instance.

What is a pity is that very little has been said about Zaad, the local mobile payment service under the spotlight. Zaad is a locally developed and managed service available all through the country and available on all mobile operators. According to all accounts and as far as I can ascertain, it is a very well designed service and one of the first to become operational on the continent. It utilise USSD as a carrier and security implementation seems to be well though out. It seems to be rich in features and can be compared with the best available. This seems to be a really good story that should have been reported on more widely. (Read the Zaad website here).

According to Wikipedia, al-Shabaab recently decreed that gold and silver dental fillings were un-Islamic, and dispatched patrols to yank them out of people's mouths. (Read here). It is a pity that a world-class service (like Zaad) be made known to the world in conjunction with a radical group like al-Shabaab.