Dahabshiil

Dahabshiil is a Somali-founded financial-services group whose principal business is the transfer of money across borders, particularly remittances sent by the Somali diaspora to relatives and communities in the Horn of Africa. The name Dahabshiil is Somali and is commonly translated as “gold smelter.” The company is headquartered in Dubai and has developed a large network of branches, agents and other service points across Africa, Europe, the Middle East and North America. The business began in 1970 when Mohamed Said Duale established a general trading enterprise in Burao, then the capital of Somalia’s Togdheer province. During the 1970s, the company increasingly focused on remittance broking as Somali workers migrated to the Gulf States and needed to send money home. At a time when foreign-exchange controls constrained conventional financial transfers, Dahabshiil and similar businesses used trade-linked arrangements, including the Franco Valuta system, to move value to recipients. These transactions became a major part of the company’s activities during the 1980s. The approach of the Somali Civil War severely disrupted the company’s operations in Somalia. The Duale family relocated to the Somali-inhabited region of Ethiopia, while Mohamed Said Duale used existing contacts in the Gulf to rebuild the business. Dahabshiil established a small operation in Ethiopia serving displaced Somali communities there and in Djibouti. In 1989, the company opened its first United Kingdom office in London’s Whitechapel district. The branch was managed by Abdirashid Duale, the founder’s son, who subsequently helped expand the business as the Somali population in the United Kingdom grew. Remittances became central to the economic life of Somalia and neighboring Somali-speaking communities. Dahabshiil grew into the largest Somali money-transfer operator and captured substantial business after the collapse of Al-Barakaat. Public reference material has described a network exceeding 24,000 agent and branch locations and operations spanning more than 120 countries, although published counts vary by date and by whether branches, agents or other service points are included. The company has served private individuals, small and large businesses, nongovernmental organizations and international institutions. Organizations identified in reference material as users or clients include United Nations bodies, the World Health Organization, the World Bank, Oxfam, Save the Children and CARE International. Dahabshiil has diversified beyond conventional remittances. In 2008 it acquired a majority stake in Somtel, a Somali telecommunications company offering mobile, internet and broadband services. In early 2009 it established Dahabshil Bank International in Djibouti, providing Sharia-compliant services such as asset finance, partnership finance and leasing. It also introduced Dahabshiil eCash in 2009 in cooperation with Somali retailers, hotels, restaurants and petrol stations, creating a debit-card service for the Somali market. The group has additionally provided transfer and payment infrastructure for organizations, companies and individuals. Community investment has been part of Dahabshiil’s public identity. Reference material states that the company allocates a proportion of annual profits to projects involving schools, hospitals, agriculture and sanitation, and that it has supported cultural and sporting activities among Somali communities in the United Kingdom. It also provided relief after the 2004 Indian Ocean tsunami and contributed to a mental-health facility in Garowe in 2009. The company operates in a politically and financially sensitive sector. Money-transfer firms serving Somalia face demanding requirements relating to anti-money-laundering controls, counter-terrorist-financing rules, customer identification and correspondent banking. Dahabshiil has described its systems as operating under international compliance standards and became author…

Dahabshiil was established in 1970 by Mohamed Said Duale in Burao, Somalia, initially as a general trading business. The company’s commercial direction changed during the 1970s as Somali labor migration to the Gulf States created demand for reliable ways to send earnings to families in Somalia. Dahabshiil began specializing in remittance broking and used trade-related mechanisms to work around the foreign-exchange restrictions of the period. The Franco Valuta system, in which imported goods and their sale proceeds helped transmit value, became particularly important to the company’s business during the 1980s. The Somali Civil War disrupted the company’s domestic operations. The Duale family moved into the Somali-inhabited Somali Region of Ethiopia, while the founder relied on relationships in the Gulf to reconstruct the business. Dahabshiil opened a small Ethiopian office serving displaced Somali populations in Ethiopia and Djibouti. In 1989, it entered the United Kingdom by opening a London office in Whitechapel. Abdirashid Duale, the founder’s son, managed the branch and helped develop the company’s presence among the growing Somali community in Britain. During the following decades, Dahabshiil expanded its international network and became the largest Somali money-transfer operator. It benefited from the contraction of the Somali market after Al-Barakaat ceased operations and built a network of agents and branches across Somali-speaking regions and diaspora destinations. Reference accounts describe more than 24,000 service locations and operations in over 120 countries, while other counts distinguish between branches, agents and outlets. The business has served households, private individuals, merchants, companies, development organizations and international institutions. Remittance services have remained the company’s foundation. Somali diaspora transfers are economically significant because they support household consumption and contribute to activity in housing, transport, communications, health, education and other sectors. Dahabshiil’s role in this market has also made it part of recurring debates about correspondent banking, compliance costs, financial inclusion and the difficulty of maintaining formal banking access for Somalia-linked payment providers. The company diversified in the late 2000s. In 2008, it acquired a majority stake in Somtel, a telecommunications company operating in Somalia and offering mobile, internet and broadband services. In early 2009, Dahabshiil launched Dahabshil Bank International in Djibouti. The bank was presented as an Islamic financial institution, with services including asset finance, partnership finance and leasing. Also in 2009, Dahabshiil partnered with Somali retailers and other merchants to introduce Dahabshiil eCash, described in the source material as Somalia’s first debit-card service. Dahabshiil has also emphasized community investment and social sponsorship. Its stated activities include support for schools, hospitals, agricultural initiatives and sanitation. It sponsored cultural and sporting events among Somali communities in the United Kingdom, assisted relief efforts after the 2004 tsunami and donated to the development of a mental-health facility in Garowe in 2009. These activities complemented its role as a financial channel for international aid and development organizations operating in Somalia. Compliance became a major aspect of the company’s public profile. Dahabshiil has identified itself with international anti-money-laundering and counter-terrorist-financing standards and joined industry associations in the United Kingdom, United States and internationally. In 2010, it obtained authorization from the United Kingdom Financial Services Authority under that year’s payment-services framework. Nevertheless, the company faced severe correspondent-banking pressure. HSBC ended its relationship in 2012, and Barclays announced in 2013 that it intended to withdraw banking services, citing concerns about anti-money-laundering governance. British lawmakers, activists and the athlete Mo Farah campaigned against the withdrawal because of its potential effect on Somali remittances. Litigation temporarily preserved the Barclays relationship, but the reference material states that Barclays subsequently ended it as part of its de-risking policy. Dahabshiil has also been the subject of allegations involving political influence, media suppression, public-relations activity and purported connections to terrorism-related conduct. A 2009 Washington Post account cited allegations concerning a former employee and a Guantanamo detainee. In 2011, journalists alleged that the company sought to suppress critical online reporting, while an undercover Independent investigation reported that Bell Pottinger had been retained for reputation management. In 2015, a lawsuit filed by the son of Saado Ali Warsame accused Dahabshiil of financing her killing and other extremist activity. These matters were controversies or allegations reported in reference material and should not be conflated with proven wrongdoing. The company has continued operating as a privately held group centered on remittances and related financial, telecommunications and payment services.

• 2020

  Collaboration with Maico Money Transfer

  [1]Dahabshiilen.wikipedia.org

  Dahabshiil collaborates with Rwandan fintech startup Maico Money Transfer.

• 2013

  Barclays banking dispute

  [1]Dahabshiilen.wikipedia.org

  Barclays announces plans to end its relationship with Dahabshiil, leading to political lobbying and court proceedings.

• 2012

  HSBC ends its banking relationship

  [1]Dahabshiilen.wikipedia.org

  Reference material reports that HSBC severed its relationship with Dahabshiil amid correspondent-banking and compliance concerns.

• 2010

  United Kingdom payment-services authorization

  [1]Dahabshiilen.wikipedia.org

  The company obtains authorization from the United Kingdom Financial Services Authority under the Payment Services Regulations.

• 2009

  Dahabshil Bank International opens

  [1]Dahabshiilen.wikipedia.org

  The group establishes an Islamic bank in Djibouti offering Sharia-compliant financing products.

• 2009

  Dahabshiil eCash launches

  [1]Dahabshiilen.wikipedia.org

  The company introduces a debit-card service in Somalia with participating retailers and other merchants.

• 2009

  Mental-health facility receives company support

  [1]Dahabshiilen.wikipedia.org

  Dahabshiil contributes to the establishment of a mental-health facility in Garowe, Puntland.

• 2008

  Majority stake in Somtel is acquired

  [1]Dahabshiilen.wikipedia.org

  Dahabshiil acquires a majority interest in Somtel, expanding the group into Somali telecommunications.

• 2004

  The company provides tsunami relief

  [1]Dahabshiilen.wikipedia.org

  Dahabshiil assists relief efforts for communities in Somalia affected by the 2004 tsunami.

• 1989

  First United Kingdom office opens

  [1]Dahabshiilen.wikipedia.org

  Dahabshiil opens a branch in London’s Whitechapel district to serve the Somali diaspora.

• 1970

  Dahabshiil is founded in Burao

  [1]Dahabshiilen.wikipedia.org

  Mohamed Said Duale establishes a general trading business in Burao, Somalia.

• 1970

  The company begins specializing in remittances

  [1]Dahabshiilen.wikipedia.org

  Migration from Somalia to the Gulf States creates demand for money-transfer services, leading Dahabshiil to focus increasingly on remittance broking.

A diaspora-oriented, Somali-founded cross-border payments brand serving individuals, businesses, humanitarian organizations and international institutions, with additional activities in Islamic banking, telecommunications and digital payments.

• International money transfer · 1970

  Dahabshiil Remittance

  Dahabshiil’s core service transfers money between diaspora senders and recipients in Somalia, Somaliland, Djibouti, Ethiopia and other markets. The service is delivered through a broad agent and branch network and has included online transfers and SMS notifications. It serves individual households as well as businesses, aid agencies and international organizations.

• Islamic banking · 2009

  Dahabshil Bank International

  Established in Djibouti in early 2009, Dahabshil Bank International provides Sharia-compliant financial services to business and private customers. The cited material identifies asset finance, partnership finance and lease finance as central areas of activity.

• Digital and card payments · 2009

  Dahabshiil eCash

  Dahabshiil eCash was introduced in 2009 with Somali retailers, hotels, restaurants and petrol stations. It was described as Somalia’s first debit-card service and represented an effort to extend the company from cash remittances into domestic electronic payments.

• Telecommunications

  Somtel

  Somtel is a Somalia-based telecommunications business in which Dahabshiil acquired a majority stake in 2008. Its services include mobile communications, mobile internet and high-speed broadband, providing the group with infrastructure relevant to digital financial services.

• 2015

  Hussein et al. v. Dahabshiil

  Harbi Hussein filed a United States federal lawsuit alleging that Dahabshiil financed the killing of his mother, artist Saado Ali Warsame, and other extremist activity. The cited material describes the complaint and its allegations, not a proven judicial finding.

  Source

• 2013

  Barclays correspondent-banking dispute

  Barclays sought to terminate its banking relationship with Dahabshiil, citing anti-money-laundering governance concerns. The dispute became a prominent example of the effect of correspondent-bank de-risking on Somali remittance providers.

  Source

• 2011

  Alleged pressure on a Somali news website

  Independent Somali journalists alleged that Dahabshiil attempted to persuade their web host to remove articles critical of the company, including reporting connected with a song criticizing Dahabshiil.

  Source

• 2011

  Bell Pottinger reputation-management controversy

  An undercover investigation by The Independent reported that Bell Pottinger had worked for Dahabshiil and described tactics intended to reduce the visibility of unfavorable online coverage, including possible manipulation of search results and Wikipedia-related activity.

  Source

• 2010

  Political-influence allegations

  Somali journalists and political groups alleged that Dahabshiil received unfair advantages through relationships with government figures, including appointments involving individuals described as connected with the company. These were reported allegations rather than established findings in the cited material.

  Source

• 2009

  Allegations concerning a Guantanamo detainee

  A Washington Post account cited allegations that Mohammed Sulaymon Barre, who had worked for Dahabshiil, may have laundered money for terrorists. The cited material reports the allegation but does not establish it as a finding against Dahabshiil.

  Source

Read more

• 2013Campaign against Barclays’ remittance withdrawal

  United Kingdom · Somalia · Somali diaspora markets

  British lawmakers, activists and Mo Farah supported a campaign urging Barclays to retain banking access for Dahabshiil and the wider Somali remittance sector.

  Outcome. The campaign contributed to public and political pressure and was followed by interim court protection, but the cited material says Barclays later ended the relationship.

  Source
• 2009Community investment and mental-health support

  Somalia · Somaliland · United Kingdom

  Dahabshiil supported schools, hospitals, agriculture, sanitation, cultural events and sports, and contributed to a mental-health facility in Garowe.

  Outcome. The cited material presents these activities as part of the company’s community-investment and social-responsibility program.

  Source

• 2013

  Contest Barclays’ decision to terminate banking servicesOther

  Background

  Barclays cited anti-money-laundering governance concerns when announcing its intention to end the relationship, a decision with potential consequences for Somali remittance flows.

  Action taken

  Dahabshiil pursued legal and public responses; the High Court granted an interim injunction preserving the relationship while the dispute was examined.

  Aftermath

  The cited material states that Barclays ultimately ended the relationship as part of its de-risking approach.

  Source

• 2010

  Obtain United Kingdom payment-services authorizationStrategy

  Background

  Formal authorization was important for customer protection, transparency and continued access to regulated payment markets.

  Action taken

  Dahabshiil obtained authorization from the United Kingdom Financial Services Authority under the Payment Services Regulations.

  Aftermath

  The authorization strengthened the company’s formal regulatory position in the United Kingdom, although later correspondent-banking disputes remained.

  Source

• 2009

  Launch Dahabshil Bank InternationalProduct launch

  Background

  The group identified an opportunity to provide Sharia-compliant banking and financing in the Horn of Africa.

  Action taken

  Dahabshil Bank International opened in Djibouti with asset, partnership and lease-finance services.

  Aftermath

  The launch added regulated banking and Islamic-finance capabilities to the group’s remittance business.

  Source

• 2009

  Introduce Dahabshiil eCashProduct launch

  Background

  Dahabshiil aimed to extend its payments role from international cash transfers into domestic electronic transactions.

  Action taken

  The company partnered with Somali merchants to launch a debit-card service called Dahabshiil eCash.

  Aftermath

  The service was described in the reference material as Somalia’s first debit-card service.

  Source

• 2008

  Acquire a majority stake in SomtelM&A

  Background

  Dahabshiil sought to broaden its activities beyond remittances and gain telecommunications infrastructure relevant to mobile and digital financial services.

  Action taken

  The group acquired a majority stake in Somtel, a Somalia-based telecommunications company.

  Aftermath

  The transaction expanded Dahabshiil into mobile communications, internet and broadband services.

  Source

1. 1Dahabshiilen.wikipedia.org