Somalia launches new payment system to boost inflows
The Central Bank of Somalia (CBS) said Tuesday it has integrated International Bank Account Numbers (IBAN) across all transactions going through the national payment system (NPS) and urged all banks to adopt it.
The bank termed the new payment system as a milestone, saying it will play a crucial role in transforming the country's financial sector as Mogadishu seeks reentry into the global financial system.
CBS Governor Abdirahman M. Abdullahi said the bank was proud to bring Somalia into the SWIFT IBAN registry, which he said reflects the staff's determination to develop the financial sector of the country.
"IBAN delivers significant advancement for our banks, and we hope this will help restore the assurances of international correspondent banks, regulators, and investors with regards to Somalia's reintegration into the international financial market," Abdullahi said in a statement issued in Mogadishu, the capital of Somalia.
The bank said the move will enhance performance in payment processing and reduce operational risks for bank transactions by enabling NPS to electronically validate bank account numbers and to choose the route a payment must take without manual involvement.
An additional benefit of IBAN is that it reduces delays in international transfers originating from IBAN-compliant countries to Somalia, CBS said.
CBS said it's committed to fostering inclusive economic growth in Somalia and building a stable and sound financial system.