Access to electronic banking services in improving the financial sustainability of MSMEs in Somalia

Digital banking solutions are crucial to enhancing the financial sustainability of micro-, small, and medium-sized enterprises (MSMEs) in Somalia, offering them innovative financial services that support their growth and resilience. The main purpose of this study is to examine access to electronic banking by providing an impact on it, thus enhancing the financial sustainability of MSMEs in Somalia. The study primarily examined the access to mobile banking, internet banking, and point of sale (POS) systems and how these services impact the financial sustainability of MSMEs in Mogadishu, Somalia. The study used primary data from a survey and obtained 350 responses from the targeted MSMEs in Mogadishu, Somalia. The data were analyzed using partial least squares structural equation modeling. The study found that electronic banking services, including mobile banking, internet banking, and POS services, have positively contributed to the financial sustainability of MSMEs. The findings suggest that electronic banking services are considered a valuable instrument that MSMEs can utilize to facilitate their daily operations. This allows small businesses to increase their sales and enhance their cash flow. Somali banks should improve the quality of their electronic banking services and provide MSMEs with training and seminars that increase their financial literacy and help them understand and become proficient in using electronic banking services. In addition, the study recommends implementing impactful rules and regulations for electronic banking services to protect and secure the interests of MSMEs.