Al-Shabaab began in the early 2000s as a small, hardcore faction breaking away from Al-Itihad Al-Islam. Initially supported by donations and alliances with the Islamic Courts Union, the group gained combat experience and financial resources. Its prominence grew after resisting Ethiopia’s 2006 invasion, attracting both recruits and funding from the Somali diaspora and business community. Over the years, Al-Shabaab forged ties with Al-Qaida and absorbed rival factions, positioning itself at the forefront of Somalia’s insurgency. By diversifying its revenue streams piracy, kidnappings, charcoal taxation, extortion, smuggling, and zakat—the group built a self-sustaining war chest. Reports suggest it earns more than the Somali government, with tax revenues exceeding $15 million per month. Businesses across Somalia often pay both government taxes and Al-Shabaab levies, with the latter seen as more efficient. Weak regulatory oversight in banking and hawala systems, combined with the absence of national identification, enables financial flows to the group. Disrupting Al-Shabaab’s finances demands robust regulation, better intelligence, physical security, and stronger cooperation between federal and state governments. Without decisive action, its financial strength will continue to fuel instability in Somalia and the wider region.