ORIGINAL RESEARCH article
Front. Clim.
Sec. Climate and Economics
Investigating the Economic Dynamics of Mobile Money in Somalia's Climate-Stressed Setting
Provisionally accepted
Mohamed Ibrahim Nor1,2*
Abdinur Ali Mohamed3- 1SIMAD University, Mogadishu, Somalia
- 2Institute of Climate and Environment (ICE), Mogadishu, Somalia
- 3SIMAD University, Graduate Studies, Mogadishu, Somalia
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This study explores the role of mobile money in stimulating economic activities and enhancing economic resilience in Somalia's climate-stressed context. It examines the impact of mobile money on household consumption, real income, trade flows, and financial inclusion, with the aim of understanding how mobile financial services influence both short-and long-term economic growth in an economy highly vulnerable to climate-related shocks such as droughts and floods. Employing a quantitative research design, the study utilizes secondary data spanning the period 2010 to 2022. The Autoregressive Distributed Lag (ARDL) model is applied to analyze the short-run and long-run effects of mobile money on key macroeconomic variables. The quantity theory of money provides the theoretical framework, offering insights into the channels through which mobile money influences economic activity and resilience in a climate-challenged setting. The results indicate that mobile money has a significant positive impact on household consumption, real income, exports, and imports in both the short and long term. Beyond facilitating financial transactions, mobile money fosters trade efficiency and enhances financial inclusion, enabling households and businesses to better adapt to climate-induced economic disruptions. These findings highlight the role of mobile money as a critical enabler of economic participation and adaptive capacity. The study underscores the importance of a supportive regulatory framework to optimize the benefits of mobile money in Somalia's climate-vulnerable economy. Policymakers, financial institutions, and mobile money providers are encouraged to expand innovative services tailored to climate-affected populations. Leveraging mobile money as part of climate adaptation strategies can strengthen economic resilience and promote inclusive development. This study offers novel empirical evidence on the role of mobile money in climate-stressed economies, using Somalia as a case study. By situating financial technology within the broader context of climate vulnerability, it demonstrates mobile money's potential as both a catalyst for economic recovery and a tool for adaptive capacity-building. The study contributes to the literature on financial technology, climate resilience, and development economics by examining how mobile money supports economic empowerment, trade integration, and financial inclusion in climate-affected economies. It broadens the understanding of how digital financial services can mitigate economic risks associated with environmental shocks.
Keywords: ARDL model, climate-stressed economy, economic resilience, Financial inclusion, mobile money
Received: 25 Aug 2025; Accepted: 29 Dec 2025.
Copyright: © 2025 Nor and Mohamed. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
* Correspondence: Mohamed Ibrahim Nor
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