Dahabshiil…. is now trying to become something bigger: a bank….
Since most Somalis do not own passports (which are in any case far from secure as proofs of identity), Dahabshiil relies on the strength of the clan network. In a country where men can recite their ancestors’ names back fifteen generations, references are an effective way to prove that new customers are who they say they are. After that, their biometric information and fingerprints are stored in a Dahabshiil database, so that later transactions can be verified. Many financial transactions are filmed, in case records are needed later.
This system has fended off bureaucrats determined to believe the worst about the firm and about Somalia, says Mr Duale. But it has not completely warded off controversy. Barclays closed Dahabshiil’s London account in 2013 largely because of worries about its reputation. The British bank did not want to risk being associated with car bombs and warfare in Somalia. After an outcry, and a court case, the two firms reached a settlement—but Barclays did not reopen the account. Mr Duale is now coy about how the firm banks in the West, refusing to reveal the identity of his partners…Zakaria Hussein Ali, the local chief operations officer, explains in a broad London accent how Dahabshiil is like an 18th-century European family bank—relying on trust and careful management to get by. He says he hopes that by the end of the century, Dahabshiil will be as big as HSBC or Citigroup is now. Such grandiose ambitions show how far it has already come.
Banking in Africa: Transfer Window, Economist, Oct. 17, at 78