Archive for the Currency / Money Category

Miracle money

Posted in Currency / Money on April 3, 2011 by Liberiana

I need money now! And not a bank in sight... whatcha gonna do?

So I decided that during my holiday break in early May I’d like to venture outside Somaliland and hopefully visit Kenya. Getting there of course means booking a plane ticket, an activity which in any normal country would be an easy, painless, web-based process. Not in Somaliland. That would be way too simple.

There are a couple airlines that fly from Somaliland to Nairobi but, of course, they either don’t have websites that work, don’t have an online booking system for that flight, and/or don’t accept credit cards. Basically, if I want to book the ticket, I have to go in person to their office and pay them $500 in cash (who, in our generation of Easy Jet and Ebookers, has ever booked plane tickets like this?).

So, slight problem. Do I own $500? Yes. Do I have it here, in hard cash? No. Can I go to the ATM and withdraw it? No, because there are no ATMs. So how on earth do I get my bloody money?! That’s where Dahabshiil, the Somali version of Western Union, comes in…

To get my money, I had to ask my friend who lives in East London to go to a dodgy little corner shop behind the East London Mosque in Whitechapel and hand over a few hundred pounds in cash to some bloke named Faysal, who acts as a Dahabshiil international money transfer agent.

All he asks for is her name, her address, my name, my phone number, and my address (which consists entirely of “Hargeisa, Somaliland,” seeing as there are no postal addresses or street names in Somaliland). She hands him the money, he hands her a receipt and, that’s it – done!

Next I go to one of several Dahabshiil offices here in Hargeisa, visit the “Remittances” desk, and tell them I want my money.  All they ask for is my name, the name of the person who sent the money, and an ID such as my passport to prove I am the recipient. They photocopy my passport, I sign a paper, and they hand over the cash. Ta da!

Of course, they Dahabshiil takes a commission, but it isn’t that much in the grand scheme of things. My friend sent £328 and I collected $500. At that day’s exchange rate, £328 was equivalent to $526, so $26 paid to transfer $500 amounts to only a 5% commission. Not bad in my opinion, seeing as my Barclays current account charges me a 5% fee every time I use my debit card to withdraw cash from abroad.

O f course, the typical Dahabshiil customer is not foreigners such as myself, but Somalilanders receiving money from their family members in the US, the UK, Canada, Kenya, Yemen, etc. The Somaliland economy, which suffers high levels of unemployment is hugely dependent on remittances from the Somali Diaspora.

Cash economy

Posted in Currency / Money on March 26, 2011 by Liberiana

Dahabshiil - the closest thing to a bank.

When I came to Somaliland, I brought a wad of cash with me. That’s because, once I got here, there would be no way for me to access my money back home in the UK or US – Somaliland has no ATMs and no banks. Yes, you read that correctly – Somaliland is essentially an unbanked, cash-bashed economy. Your regular credit and debit cards are totally useless here. Traveller’s cheques aren’t going to help you out either.

The closest thing to a bank in Somaliland is Dahabshiil, which is really more of a remittances / international money transfer company than a bank. It’s Somaliland’s answer to Western Union, enabling the Somali diaspora community to send money back home to family and friends in the Horn of Africa through a network of 400 branches across 144 countries.

You also have the option to open an account directly with Dahabshiil in Hargeisa, which some of my co-workers have done to avoid stashing all of their money under their mattress. Indeed, when we are paid at the end of the month, we are paid by check which we have to go to a Dahabshiil branch to cash.

But, even if you do open an account with Dahabshiil and deposit some of your money in it, there is no way you could transfer your money from that account to any other bank, because Dahabshiil is totally unconnected to the international banking system. The only way you could get your money out of Somaliland is to carry it out in hard cash or transfer it to a Dahabshiil branch/agent abroad (e.g. in the US or UK) where you would have to collect the money in person.

While frustrating and impractical for expatriates such as myself, the system is not as stuck in the stone ages at it seems. Dahabshiil has even introduced a sort of payment card which can be used in lieu of cash at a very select number of retailers in town.  Just like paying by debit card back home, you insert your card and type in a code (except, unlike internationally recognized bank cards, your Dahabshiil card won’t work anywhere outside of Somaliland). And it is also possible to send payment via mobile phone and online. It still would be nice to have an ATM, though…

Somaliland Shillings

Posted in Currency / Money on March 10, 2011 by Liberiana

Try fitting that in your wallet

One of the first things to get in order upon my arrival was changing money into the local currency, the Somaliland Shilling. At the airport we were asked to change a minimum of $50 per person at a rate of 4,000 shillings per dollar (somewhat below the going rate down town of 5,000 shillings per dollar).

We changed $150 (three crisp fifty-dollar bills) and got back in exchange a massive brick of dirty, battered, odd-smelling notes held together with rubber bands. It was literally the size of a book.

There is only one note which is really in use, the 500 shilling note, and that is equivalent to $0.10. So, to get 10 dollars, you need one hundred of those notes (50,000 shillings), which is a wad nearly an inch thick. So it’s impossible to fit even $10 in your wallet.

Instead, you need to carry the rubber-banded chunks of cash loose in your purse or in an envelope or plastic bag. I’ve taken to storing the bricks in my drawer and carrying around no more than $10 at a time (which, believe me, can get you very far in Somaliland).

But the US dollar is king here. It’s possible to pay for many things with dollars (although they might have difficulty making change for a large bill, i.e. anything over $5). For example, I bought a SIM card at the  mobile phone office for $5 and a shawl at the market for $5. If you ever come to Somaliland, I suggest you bring lots of $5 and $1 bills. And a very big wallet.

The shilling equivalent of $10. Good thing everything costs $1.

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