Edward Paice is director at Africa Research Institute, interviews Abdirashid Duale, chief executive of Dahabshiil, the largest money transfer business in the Horn of Africa:
We also provide a service for the people who might not use banks even if they could – for the unbanked in the UK, Somalia and elsewhere. Forget the Somalia end of things for a moment. We fill a gap for diaspora communities. If you go to a Dahabshiil location or agent in the UK – where there are more than 100,000 people of Somali origin – most open early in the morning and work up to 10 o’clock at night, 7 days a week. You deal with people you know, the service is fast and friendly, it is easy to use, and it is half the cost of the big Western money transfer companies.
If you go to any bank in the world and say you want to send money to Somalia or Somaliland, they cannot do it. The big global money transfer companies like Western Union can’t do it either. They have one branch in Hargeisa, in Somaliland. Western financial institutions have no links to the Somali banking network because there isn’t one.
The more I hear about this the more I think there’s something bigger going on than just Barclays hedging their bets against any wrong-doing by MTBs. This whole interview is fascinating.
There’s something fishy going on at Barclays than meets the eye. This feels like the whole banking sector has been getting external pressure to shutter any support to the Horn of Africa.
The weak link in the remittances game is that migrants can only send money home if the regulatory environment in their host country allows it. Without a banking facility to work with, then Dahabshil, a home-grown solution, is effectively shuttered. Same goes for any MTB that attempts to fill the void of providing services in the region.
Is this an opportunity Africa’s mobile money revolution can exploit to fill the gap? There is a sizable Somali population in East Africa, home of the mobile money revolution started by MPESA. If traditional multi-national banking mechanisms are getting cold feet, can an African solution, built to function in challenging environments fill the gap?
It is amazing that just the imagined perception or possible misuse of financial services to fund a fringe anti-West terrorist group justifies putting the survival of millions of people at risk.
Something is definitely fishy here. It does raise the question for me if the lone Western Union in Hergeisa was also affected by this decision. And if not, why not? My guess is that there’ll soon be multiple Western Union locations in the region.