A robust national payment infrastructure facilitates secure, real-time transactions, which is essential for economic recovery and international trade. By reducing reliance on cash, enhancing security, and expanding financial access, this system will unlock new economic opportunities,

Somalia has successfully launched its first nationwide Instant Payment System (SIPS) under the Somalia Payment Switch (SPS), a payments infrastructure operated by the Central Bank of Somalia (CBS). This marks a major step in modernizing Somalia’s payment infrastructure, enhancing financial inclusion, and strengthening economic stability.

To facilitate this transition, the SmartVista platform by digital payment solutions provider Banking Payments Commerce (BPC) was chosen for its ability to comply with both local and international regulations while enabling seamless connectivity between banks and financial service providers.

The Instant Payment System introduces real-time transactions and QR-based payments, allowing Somali consumers to make instant, secure transfers through their mobile or banking apps using PIN or OTP authentication. At the core of this transformation is SOMQR, Somalia’s national QR payment standard, which facilitates seamless and interoperable digital transactions across the country.

The system includes key features such as a Participant Portal for real-time transaction monitoring, an Integration Platform for seamless financial connectivity, and a Dispute Portal for resolving transaction issues efficiently. Additionally, a Fraud Management Solution will transition from a cloud-based system to a local data center, further enhancing security and compliance. With Public Key Infrastructure (PKI) in place, unauthorized access and fraudulent transactions will be significantly minimized.

The launch of Somalia’s Instant Payment System (SIPS) directly addresses the country's low banking penetration and financial exclusion challenges. The United Nations Industrial Development Organization (UNIDO) highlights in its 2020 ‘Somalia Financial Sector Technical Report’ that only about 15 percent of Somalia's population has a bank account, and fewer than 5 percent of these account holders actively use their accounts. With only 15% of the population holding a bank account and fewer than 5% actively using them, the Somalia Payment Switch (SPS) and QR-based payments will provide a seamless, digital alternative to cash transactions.

By enabling instant, secure transfers via mobile and banking apps, this initiative will bridge the gap between the unbanked population and formal financial services, accelerating Somalia’s digital financial transformation.

Hikmatu Bilali