The Somali operator, Hormuud Telecom was established in 2002, in Mogadishu, Somalia. The company started with 250 shareholders, ten customer service centers, and a few thousand customers. At that time, the company only offered voice and SMS services. Seventeen years later, Hormuud Telecom has attracted well over 4 million subscribers, 12,000 shareholders, and over 800 customer service centers in both urban and rural Somalia. Today, its mobile networks cover more than 80% of the land area in South and Central Somalia and it offers a diversified portfolio that answers corporate, personal, and business needs.

Telecom Review Africa had the pleasure of interviewing Ahmed Mohamed Yusuf, CEO and chairman of Hormuud Telecommunication to talk about the operator’s latest focus: mobile money service and its important role in Somalia, in addition to the company’s future plans.

Mobile money services have been booming in Africa and recently they have taken off in Somalia. However, what are the risks in the mobile money system?

In Somalia, mobile money has traditionally operated within a limited regulatory environment, which comes with many risks. However, we expect that this will soon change as the Central Bank of Somalia is introducing mobile money regulations. All major mobile money service providers are already adopting these measures.

At Hormuud we are going further and implementing the GSMA Mobile Money Certification, which requires adhering to a set of complex financial, technical and service obligations.

How is mobile money in Somalia different from other African countries?

During the 1990s and 2000s, Somalia was gripped by the civil war. As a result, the formal banking infrastructure system disappeared. The Central Bank closed and there was monetary instability. 98% of the Somali shilling was counterfeit, according to an IMF report. Furthermore, as a result of political instability, Somalia experienced double digit inflation rates, which made cash distribution particularly difficult.

Therefore, it was against this backdrop that mobile money emerged. Mobile money for Somalis is an essential lifeline to financial inclusion. 76% of people who have mobile phones use mobile money in Somalia, and of these, over 90% use EVC Plus. It is such a privilege to lead a company where we’ve created such trust that our customers use EVC Plus for all types of payments. There is evidence to show that over two-thirds of all payments utilise mobile money.

In your opinion, how is a successful and innovative mobile money platform built in one of the most challenging economic environments in the world?

Resilience and agility are essential in creating the most innovative technology platforms. We must listen to our customers in order to provide the best services.

Hormuud is unique as a mobile money platform operator, specifically designed for the African environment. When we founded Hormuud Telecom, we knew we had to adopt the specific Somali context. Thus, Hormuud Telecom emerged when Somalia was gripped by conflict during the civil war. The most successful and innovative technologies are those that react with their costumers rather than impose upon them.

With online services comes the fear of cyberattacks. How do you provide safe transactions for customers using mobile money and protect them from system vulnerabilities?

Indeed, the risks of cyberattacks are always present with online transactions. However, we have taken all necessary precautions to protect customers; we adopt vigorous cybersecurity protocols in line with international standards. With each emerging risk, we remain vigilant.

What are your plans to expand this service even more on the Somali territory?

We are working to ensure our services can be integrated into the commercial ecosystem, where businesses can use our platforms for multiple purposes that suit their needs. This includes expanding our e-commerce payment system amongst other things.

We are guided by our mission of accelerating financial inclusion, reducing the rural-urban divide with regards to technology. Therefore, our mobile money services will be free of charge, which will enable a higher percentage of the most vulnerable communities to access critical services.

What are your future plans for Hormuud in 2020?

We believe that our model of financial inclusion can provide answers to other nations to ensure that the most vulnerable and marginalised communities are not excluded from the cashless economy. In Somalia, we are working with the necessary stakeholders to increase rural and urban internet coverage so that Somalis achieve national and international ICT targets.

We are diversifying into renewable technologies by increasing our green energy mix. Over two-thirds of our masts already operate on solar energy. We will continue to ensure that our masts are energy efficient and green where possible.

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