New 1,000-shilling notes to become legal tender in 2024
After Kenya in 2019 and Nigeria in December 2022, the Central Bank of Somalia has revealed plans to change its currency making it the third nation to do so.
The action aims to combat inflation, surplus cash in circulation, and fake currency. However, the bank will only issue new high-value notes to replace those that were last issued in 1991, just before the Somali Civil War. In order to issue the new banknote designs in 2018, the bank first unveiled them in 2018. The old currency is almost pretty much nonexistent, and the new one that will be in use the next year will fight illicit money and stop inflation by soaking up extra liquidity.
Since 2018, the IMF has also helped the central bank regulate and oversee the financial industry so that it is accessible to new investors. Since the civil conflict started, it has also been difficult to rebuild capacity.
Garowe, Baidoa, and Kismayo are among the capitals of the federal member states where new branches of the central bank plan to be established by the end of June. Since the collapse of Somalia’s government in 1991, the regulator has kept Treasury offices spread out over the country, where tax money and banknotes were safeguarded.
The branches will help the central bank with tax collection, money handling, and acting as the main fiscal agent for the federal states. The value of the new money that the central bank will produce will also need to be maintained by the branches.
