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Somali rebels threaten mobile banking group

Mobile money is, apparently, unIslamic

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Network operators in Somalia have been given three months to pull the plug on money transfers by mobile phone, or face the consequences.

The threat was made in a statement by al-Shabaab, a group apparently inspired by al-Qaida, and gives the three network operators in the region three months to block transactions over the Zaad Service. This is according to African mobile website Mobile Money Africa.

Al-Shabaab runs a significant proportion of the parts of Somalia that aren't managed by the UN - which would be most of the country. The group reckons that the Zaad Service, which is owned and operated Telesom (one of the local operators), is part of a conspiracy by the west to seize control of the Somalian economy, and that as such it can't be allowed to continue.

Now... our economy might be in a bit of a mess, but compared to Somalia we're rolling in clover and gaining control of the Somali shilling surely isn't high on the western priority list. The GSMA reckons that al-Shabaab doesn't like mobile transactions as they take business away from the hawaladars: an informal, international, network of money transfer agents. Local hawaladars almost certainly come under the control of al-Shabaab, so by enabling person-to-person transactions, Zaad takes power from the group.

The Zaad service, and the hawaladars, are mostly concerned with transferring money into the country from expatriates working abroad who want to support their families at home - and with the country in such a mess that's a significant source of revenue. But the service also provides merchant accounts, allowing the user to pay for goods and and services as if with a debit card. According to al-Shabaab, that has reduced the use of cash and proves the conspiracy.

Amusing as the idea of an American conspiracy to control the local currency is, it doesn't really matter what excuse the group is using - the issue is about who controls of the flow of money, with technology enabling citizens to bypass local warlords. Al-Shabaab has threatened the network operators as it can't reach Zaad itself. The insurgent group only controls the south of the country, and the telecom which runs the mobile banking service is based in the UN-protected north, in Mogadishu. However, in areas where the rule of law has fallen down mobile network operators are awfully exposed. ®

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