BEIRUT — Banque Du Liban is further pushing towards making the Sayrafa rate the de facto local and international benchmark for the US dollar to lira exchange rate. The Sayrafa rate will now be used for all fresh and all international card payments, including point-of-sale and e-commerce transactions and ATM withdrawals.
Here’s what we know:
• On Jan. 4, Banque Du Liban instructed the global payment providers Mastercard and Visa that the new US dollar to lira exchange rate for card transactions will change from LL12,000 to Sayrafa rate, starting Feb.1. The Sayrafa rate will be published daily on the central bank’s website.
• The new rate is an update to the LL12,000 to the US dollar adopted by the global payment providers in July when the Sayrafa rate was still around LL14,000 to LL15,000 to the US dollar and the parallel market rate was around LL17,000 to LL18,000 to the US dollar.
• On Wednesday, the lira was trading at LL20,650 to the dollar on the parallel market, while the Sayrafa rate closed yesterday at LL21,200.
• Before this announcement by the central bank, Areeba sal and Credit Card Management sal told L’Orient Today that local merchants were already accepting international cards. Processed payments in US dollars were made directly into the merchants’ fresh US dollar accounts at their bank. The merchants only had to inform them — Areeba and Credit Card Management — to enable the point-of-sale terminals so the terminals can differentiate between local and international cards.
• The banks L’Orient Today spoke to said they are ready at their level to implement the necessary changes. They said that for withdrawals, the ATMs should by tomorrow start dispensing Lebanese lira at the Syarafa rate for holders of international and local fresh cards. The banking sources added that at the merchants’ level, the roll out may take more time, but it should not take more than a couple of weeks.
• Both banks and card machine operating companies told L’Orient Today that the only problem still being worked out is the issue of the local fresh cards not being recognized by the merchants’ point-of-sale terminals as fresh US dollar cards. Meaning, if a client uses a card issued by a local bank, even though it has been loaded with fresh US dollars, the terminal will process the US dollar as local dollars and not as fresh US dollars.
• Holders of international cards and local fresh US dollar cards will now know the exact exchange rate used to convert their US dollars to lira, and merchants can no longer exercise their discretion in deciding the parallel market rate.
• As long as the Sayrafa rate and the market rate are close in price, or the market rate is stronger than the Sayrafa rate, then this new mechanism should work well. Problems will arise once the market rate weakens relative to the Sayrafa rate, and it won't be economical anymore to use the cards.
BEIRUT — Banque Du Liban is further pushing towards making the Sayrafa rate the de facto local and international benchmark for the US dollar to lira exchange rate. The Sayrafa rate will now be used for all fresh and all international card payments, including point-of-sale and e-commerce transactions and ATM withdrawals.Here’s what we know: • On Jan. 4, Banque Du Liban...