Currency Management 

 

Functions and Duties Responsibility.

  1. denominations - the appropriate denominations of banknotes and coins that will concurrently enable the public to carry out its cash transactions efficiently and minimize the cost of issuing new currency.

    Designing banknotes and coins - The Governor of the Bank of Somaliland and Currency Management Department determines the form of banknotes and coins with the approval of the Administrative Council and the Government. (as per Act 54/2012 42 in the Law). After consultation the Governor will approve the printing banknotes

    Ordering banknotes and coins - By correctly predicting demand for banknotes and coins and planning the ordering and supply by means of international tenders, maximum savings can be made in stockholding costs and the inevitable expenses incurred in every order. Banknotes are printed and coins minted abroad, since the requirements of Somaliland economy do not justify the establishment of a printing press or mint in Somaliland

    Storage - When they arrive from abroad, banknotes and coins are stored in the vaults of the Bank of Somaliland , requiring strict transport arrangements, rigorous security, and meticulous control.

    Supply of cash - Cash is supplied to the public via the commercial banks and the Postal Bank, which order the required quantities from the Bank of Somaliland Braches in accordance with supply and demand expressed by deposits and withdrawals made by the public.

    Overseeing the quality of currency in circulation - Banknotes that the banks deposit with the Bank of Somaliland are carefully counted and authenticated, using sophisticated equipment that also sorts the notes into those which are reusable and those to be shredded. Degraded coins are destroyed.

    Prevention of counterfeiting - The Department takes action to detect counterfeit banknotes and remove them from circulation by studying the characteristics of counterfeits in the market, upgrading the safety markings that appear on currency, enhancing the public's awareness of these markings by advertising and instructional activities, and cooperating with the police, the Association of Banks, the banks, and international organizations that are active in the war on counterfeiting.

    Issuing commemorative coins - The Governor determines the form of commemorative and special coins per approval of the Administrative Council and the government. For this purpose, he/she avails him/herself of the Development Committee for the of Banknotes and Coins. The Bank issues commemorative coins annually and for special occasions. These are generally made of gold or silver and are sold to collectors and the public through the Somaliland Government Coins and Medals Corporation,

    Service to the public - Exchanging old currency for current legal tender, making change and exchanging coins for banknotes, and replacing degraded currency.

    Information for the public - The Department responds to enquiries from the public on currency-related topics and publishes information about safety markings on currency.

Implementation of Clean Note Policy: During the year under review, Department Currency continued its efforts to ensure adequate availability of fresh and clean banknotes and supply of coins in the economy. For the purpose, the Cash Management team took various steps including vigorous monitoring of the issuance of fresh as well as good quality notes to general public through commercial banks. In addition to regular supply of fresh notes, the speedy disposal of soiled notes, mechanization of cash processing activities and strict compliance of stopping the practice of stapling banknotes have contributed towards improving quality of banknotes in circulation.

These efforts were further intensified in respect of distribution and monitoring of supply of fresh notes to the public on special occasions like Eid-ul-Fitr, Eid-ul-Azha etc at all field offices/ branches of Bank of Somaliland. For ensuring that Money Exchange Dealers comply with the instructions issued by Central bank of Somaliland, special monitoring teams examined the distribution of fresh notes to general public by branches of commercial banks. Where irregularities observed, punitive actions have been taken. These efforts yielded encouraging results and generally good quality banknotes are now available in circulation, though more efforts are required to improve the situation.