The storefront of a CashUnited network agent. (Credit: PHB)
BEIRUT — In a circular dated Monday (Circular 614) and already published on its website, Banque du Liban extended to all money transfer companies operating in Lebanon and meeting certain criteria the possibility to carry out foreign exchange operations at the request of their customers and with funds received from abroad. The text is applicable from the date of its publication.
Until now, only OMT, the representative of the Western Union network in Lebanon, had been authorized to offer this type of service since October 2021. OMT publishes daily the applicable exchange rate (which is different from the one relayed by the Sayrafa platform operated by BDL). BDL has not specified what exchange rate will be applied by eligible companies under the terms of Circular 614.
The latter sets several conditions of eligibility, including one that goes beyond the framework of foreign exchange operations, namely the capital requirement for every money transfer company to set aside LL500 million per branch — 50 times the previously required amount. Money transfer companies will have until June 30, 2022, to comply with this requirement.
In addition, each money transfer company should have recorded more than $50 million in inflows into Lebanon in the year prior to its application for a license in order to carry out foreign exchange transactions. The currencies purchased through these operations will then have to be resold exclusively to BDL. This measure would aim to “continue to limit the influence of the parallel market on the exchange rate of the Lebanese lira,” according to a banking source.
Another financial source close to the matter said that among the 13 money transfer companies registered with BDL, only CashUnited and BoB Finance should be able to meet these conditions and submit such applications.