Mobile money baffles pastoralists in central Somalia

(ERGO) – The collapse of the local shilling is forcing pastoralists from remote parts of central Somalia to grapple with the use of foreign currency as well as mobile phone technology when they try to sell their livestock.


In the livestock market of Guriel, nobody uses the Somali shilling any more. The US dollar is the only currency in use, and in mobile money form rather than cash.

Local traders turned down the Somali shilling in different regions in central Somalia seven months ago because of the flood of counterfeit notes in circulation.

For Mohamed Farah, 70, a pastoralist, this is a huge challenge because he neither understands the value of the dollar, nor can read or write.
He bought a phone for $18 several months ago using profit from the sale of some goats. But he struggles to use the phone to make mobile money transactions comfortably.  Last week, he brought five goats to the market from Biyo-gadud village, 36 km south of Guriel, hoping to make a good sale.

Mohamed was offered a price in dollars which seemed far below his expectation, as he did not understand the exchange rate of the Somali shilling to the dollar.  Prices in shillings seems huge as compared to the equivalent in dollars. He opted instead to swap his goats for food including flour, rice and cooking oil, reverting to an old form of barter.

For Gambe Aabi, a herder from Lafweyn, the offer of $21 for his two goats – a small figure compared to the equivalent of 700,000 shillings – seemed nothing short of an insult. He decided to take his animals all the way home, 22 km away, despite urgently needing some cash for the family.

“The livestock I travelled with could not fetch as much as I expected in Somali shillings,” he told Radio Ergo. “I left my children at home who had not eaten.”

Gambe has 10 children and only 30 goats left out of his original herd of 100. His niece sent him a mobile phone from Guriel but he is still learning how to use it. He has also lost sales because he cannot get used to mobile money transactions.

There are numerous other challenges facing pastoralist families in the remote rural areas. Gambe has no access to power to charge his mobile phones. It sometimes stays off for days when the battery has run down. Whenever he can he gives his phone to people travelling to Guriel to charge it, and bring it back the next day or as soon as possible.