(ERGO) – New financial reforms in Somaliland have put hundreds of informal money changers out of work and unable to support their families, as laws have tightened to curb black markets and stabilise the local currency.
Authorities said those exchanging money at rates not commensurate with the new official exchange rate of 11,000 (buying) to 11,100 (selling) Somaliland shillings per US dollar, were operating outside the law.
Unlicensed money changers are no longer able to exchange cash through the popular Zaad and eDahab mobile money services.
Jimale Hassan Suleiman, 19, said he was given no time to prepare and had to leave Form Four at the Today Secondary School in Hargeisa as he could no longer pay the $25 monthly fee. He was also supporting four younger siblings and his parents on his income as a money changer.
“The decision to stop our work came suddenly. Even the shops that used to trust us no longer give us anything on credit because they know the money exchange business has been stopped. When we call relatives, they can’t give us much to help us either so this decision has affected us very badly,” he complained.
Jimale made $20 to $30 a day from money changing, from which he paid $60 a month for rent, electricity and water as well as other household expenses. He started this in 2023 with a loan from a friend: “We had an older brother who supported us, but he got married and the burden of the family fell on me. A friend gave me $100 and that’s how I entered the market. Now I don’t see any hope with the government’s strict regulation.”
Jimale has no savings and is concerned now about supporting his younger siblings and his parents, with certain health conditions.
“I thought I would go into construction, but I could not find work,” he said. “I feel a lot of pressure and sadness because I don’t know where to turn. I don’t have another skill.”
The authorities have applied the cost of $700 for a licence to register to operate as a money; changer there is also an annual tax of $130.
Awo Adan Mohamed, 24, who started in the business with $50 from a relative, says there is no way she can afford the official licence.
“We used to manage three meals a day without much difficulty. Now even one meal is hard to provide. Life is becoming more difficult, and the work we depended on has stopped. Our situation is very difficult,” she said.
She made $300 to $400 a month from money exchange and used the income to support her mother and three younger siblings. She is now staying at home without another source of income. She took over supporting the household after her father died last year. Her mother has a liver condition and can’t work and the family struggle to afford medical care.
“I feel extremely sad and I keep thinking about what I can do. I have looked for other jobs, including women’s work such as henna and makeup, but I have found nothing. It comes down to connections and knowing people. Life has become very difficult, and the only work we depended on has been taken away,” she said.
Two of her siblings have stopped attending school because she can no longer afford the $20 fees.
Another young provider, Samira Mohamed Hassan, 20, worked changing money for two years to support her family of eight. She has just taken $90 worth of food on credit and doesn’t know how they will repay or manage when it is finished.
“I used to earn at least $15 to $20 a day from money changing. Unemployment has caused six of my younger siblings to stop attending school and madrassa. I used to pay $40 for the madrassa and $45 for school. We have also lost the three meals a day we used to have. Sometimes I call relatives and ask them to help, but you can’t escape poverty or satisfy your needs through other people’s help alone,” she said.
Samira’s parents struggled to put their children through school and could not afford to send Samira to university. She had been hoping to help her younger siblings avoid the same obstacle.
The traders put out of business are calling on the government to review the situation and find a way for them to continue earning a living – although there appears little likelihood of such a reprieve.
