In efforts to modernise its financial infrastructure and reduce reliance on cash transactions, Somalia has introduced its first nationwide Instant Payment System (SIPS).

Spearheaded by the Central Bank of Somalia (CBS), this initiative is a critical step toward promoting a digital economy, enhancing financial inclusion, and aligning with international financial standards.

A Leap Toward a Cashless Economy

The newly launched system, underpinned by the Somalia Payment Switch (SPS1), is designed to process transactions in real-time, 24/7/365, providing businesses and consumers with immediate and secure payment capabilities.

This robust infrastructure allows for instant bank transfers and QR-based payments, offering a seamless, cash-free alternative for daily financial activities.

One of the core innovations of this system is the introduction of “SOMQR”, a national QR payment standard that enables fast, contactless payments.

Consumers can now initiate transactions through mobile and banking apps by scanning merchant-presented QR codes, making digital payments more accessible and convenient.

This development is expected to significantly reduce cash dependence and encourage the adoption of digital financial solutions across the country.

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Enhancing Security and Reliability

Security is a cornerstone of the new payment system. By utilising Public Key Infrastructure (PKI), the platform ensures encrypted, secure transactions and protects against unauthorised access and fraudulent activities.

The system also includes advanced components like a Participant Portal for real-time transaction monitoring, an Integration Platform to facilitate connectivity between financial institutions, and a Dispute Portal for quick resolution of payment issues.

In addition, BPC’s Fraud Management Solution will soon transition from its initial cloud deployment to a local data centre, strengthening data security and ensuring compliance with both local and international regulatory standards.

These measures not only enhance consumer trust but also position Somalia as a serious player in the global digital financial ecosystem.

Driving Economic Growth and Financial Inclusion

The launch of SIPS aligns with the broader goal of promoting financial inclusion and supporting Somalia’s economic recovery.

By connecting seven financial institutions to the system, with six more expected to join, CBS aims to bridge the gap in access to financial services, particularly for underserved communities.

CBS Governor Abdirahman M. Abdullahi, who also chairs SPS, emphasised the transformative potential of the system, stating, “This innovation brings speed and security to daily transactions, empowering businesses and individuals to embrace a cashless economy.”

The system is expected to boost business efficiency, reduce transaction costs, and facilitate smoother cross-border trade.

Collaborative Efforts for a Digital Future

The implementation of the Instant Payment System is a result of collaborative efforts between CBS and BPC, a global leader in payment solutions.

BPC’s SmartVista platform, which powers the system, is designed to be scalable and future-proof, capable of supporting national projects for decades to come.

Angelo Bertini, Vice President and Chief Commercial Officer at BPC, expressed the company’s commitment to supporting Somalia’s digital transformation.

“Providing next-generation technology is vital for enabling safe and efficient payment services. We are honoured to assist SPS in this transformative journey and look forward to accelerating financial inclusion across Somalia,” he remarked.

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Toward a Digitally Inclusive Somalia

Beyond modernising payment systems, CBS and SPS have a broader vision to develop a National Payment Infrastructure that supports Somalia’s integration into the global financial system.

This initiative lays the groundwork for long-term economic growth by facilitating secure, efficient, and transparent transactions.

As the system continues to evolve, its impact on Somalia’s economy and society will become increasingly evident.

By providing real-time, secure payment capabilities, the Instant Payment System is a major step toward financial modernisation, promoting a more inclusive economy and enabling businesses and individuals to thrive in the digital age.