Kebribeyah, ETHIOPIA (ILO News) – Arriving at just one-year-old in Kebribeyah refugee camp, fleeing conflict in Somalia, Layla Abdi Mohamed lived a life defined by displacement. As the 35-year-old accessed formal banking services for the first time in her life through ILO’s financial inclusion initiative, a new chapter begins for her. 

Kebribeyah refugee camp, established in 1989, is the country's oldest, hosting over 18,000 refugees. For decades, access to financial services for refugees has been a significant challenge. 

Layla is among the first refugees to utilize “Aisha”, an innovative, Sharia-compliant financial product launched in February 2024 by Shabelle Bank in partnership with the ILO. With a loan of ETB 40,000 (approximately $320) she injected the much-needed capital to her small grocery shop. "I used to run out of stock so quickly and had to go to wholesalers so frequently," Layla explains. "Now, my capital has increased, and so has my stock, which decreases the frequency of trips to wholesalers." Her expanded inventory now includes packed beans, mineral water, and soft drinks and has increased her income and profit.

Before accessing ”Aisha”, Layla, a mother of nine, relied on "Hagbad," a traditional savings and credit group where members contribute and rotate a fixed capital. While Hagbad offered a community-based solution, its limitations were clear. 

"Hagbad relies on small contributions: the capital is usually small, and members had to wait for their turn to get the money, thus hindering their ability to access funds precisely when needed," Layla explains. Layla always wanted to access formal banking, drawn by the flexibility of taking loans or saving money as needed. With her dream fulfilled, she is now committed to timely repayments and eager to secure larger loans in the future.

"Aisha", named after a common regional female name, primarily targets women entrepreneurs from refugees and host communities. Unlike traditional interest-based loans, Shabelle Bank provides stock, supplies, or equipment at a marked-up price, with convenient instalment repayments. Beyond capital, Aisha emphasizes financial education and business development services, empowering beneficiaries to manage their businesses effectively and build sustainable livelihoods. 

© ILO/Zelalem Alemenew Desta

“Aisha” first introduced to host communities in Kebribeyah in June and July 2024, empowering 36 small business owners. Hayba Farrah Muhamud, a mother from the host community, borrowed ETB 50,000 (approximately $400) to purchase essential goods for her small business. Alongside her solidarity group - typically 3 to 5 members who act as mutual collateral - she has consistently made monthly repayments, demonstrating the power of collective responsibility in encouraging savings and loan adherence.

The expansion of "Aisha" to refugees in May 2025 was facilitated the Refugee and Returnee Service (RRS), Ethiopia’s refugee coordinating agency. RRS assisted in beneficiary selection and vital documentation for Shabelle Bank. Layla Abdi was among the first 40 refugees selected and has already made her first loan repayment.

© ILO/Zelalem Alemenew Desta

Abdinasir Hassen, a Customer Relation Officer at Shabelle Bank's Kebribeyah Branch, highlights the bank’s hands-on approach. "I paid a visit to customers at their workplace and advise on their business and to save money so that they could easily make the repayment," he states. He further emphasizes the program's success, stating, "This initiative is going well and is so far successful. Once the customers fully repay the loan, we will provide them with additional loans of up to double what they first borrowed."

The ILO recognizes the critical importance of financial inclusion for refugees, not only for their self-reliance but also for fostering economic growth and stability in host communities.

"As part of our commitments made during the 2023 Global Refugee Forum, we are supporting refugee economic inclusion, as a means towards refugee access to decent work through their participation in viable economic opportunities," said Stephen Opio, Chief Technical Advisor of ILO PROSPECTS in Ethiopia and Sudan. 

He added, "Refugee access to formal financial services is a great milestone towards their self-reliance. Layla is a great example of how refugee access to formal financial services can enable one to build a sustainable livelihood while contributing to the local economy, in dignity."

The ILO, under the PROSPECTS Partnership, is working on refugee inclusion into national systems, including financial inclusion. This involves partnering with local financial institutions, governments, and other organizations to create enabling environments. Eirmyas Kaase, Senior Programme Officer at ILO, said, "Part of our focus is on supporting government and partners to put in place policies and adopt best practices that facilitate refugees' access to formal financial systems, moving beyond reliance on aid." Eirmyas added. "We support initiatives with business development service providers to provide financial literacy training and encourage entrepreneurship among refugee populations”. 

The success of the Aisha product in the Somali Region, benefiting 71 individuals both refugees and host communities, exemplifies the ILO's broader vision: creating inclusive economies where everyone has the opportunity to thrive, regardless of their circumstances. Such initiatives are vital steps towards building more resilient and equitable societies.