Somali citizens will for the first time be able to withdraw funds from any MasterCard-licensed ATM globally, shop online, and pay for goods and services using branded payment cards.

This follows the partnership between MasterCard and the country's central bank, Premier Bank, which sees MasterCard become the first international payments company to enter Somalia's payments network.

Located in the Horn of Africa, Somalia has not had any form of formal banking service since the collapse of the government and financial services system in 1991.

According to the World Bank since the early 1990s Somalia has experienced cycles of violence that fragmented the country, destroyed institutions, and created widespread vulnerability.

A statement revealed that Premier Bank ATMs will accept MasterCards for cash withdrawal; the bank will also issue 5,000 MasterCard debit cards this year, followed by prepaid cards, and point of sale (PoS) machines.

The introduction of the MasterCard payments network means that foreigners, expatriates and international aid organisations sending funds to Somalia can do so via a formal, traceable network eliminating the risks of transferring and transporting cash, the statement adds.

Commenting on the partnership Abdirahman Yusuf Ali Aynte, the minister of planning and international cooperation of Somalia said, "Somalia has made significant strides to rebuild the country and instil peace and stability. Today marks a historic milestone, signalling Somalia's financial liberation following years of being excluded from participating in the global economy."

"Reassuring foreign investors, Somalis in the diaspora and those distributing aid that our financial systems are secure and properly regulated is critical to Somalia's economic well-being," he added.

Remittances contribute well over $1 billion to Somalia's economy annually, notes the statement.

Daniel Monehin, division president for sub-Saharan Africa, MasterCard said, "To promote economic growth in Somalia, which has long been isolated from the global economy, there is a need for electronic payment solutions that align with international security and regulation standards."

"Our agreement with Premier Bank comes at a time when MasterCard is working closely with governments and financial institutions across Africa to introduce safe and simple financial solutions throughout Africa, achieving our vision of a world beyond cash," he stated.