OMT is one of the authorized agents of the Western Union network in Lebanon. (Credit: João Sousa)
BEIRUT — The money transfer company OMT, one of the authorized agents of the Western Union network in Lebanon, issued a statement Monday evening acknowledging the suspension of its foreign exchange operations, citing "strong fluctuations" of the dollar-to-lira rate on the parallel market.
The statement denied rumors that the Banque du Liban withdrew its license to carry out foreign exchange operations, which it called "false and fabricated" information.
The parallel market exchange rate fluctuated violently in recent weeks, reaching a record low of LL63,000 to the dollar last week, before recovering to LL57,000 as of Monday.
"According to the time-honored mechanism, OMT could not buy and sell dollars at that rate and had to comply with the rate imposed by the BDL, which has remained much lower," explained a source within the agency who asked to remain anonymous. "The rate we were showing in our branches was LL43,000 to the dollar at the time the decision to suspend these operations was made last Friday. At that rate, no one was interested in selling their dollars to us."
OMT could not offer a potential timeline for the resumption of foreign exchange operations, the same source added.
The transfer company began offering foreign exchange services in October 2021 after obtaining permission from Banque du Liban It coordinated its exchange rate with the central bank. The dollars obtained from OMT's clients were sold "exclusively" to BDL as part of a mechanism presented as a means to increase the country's foreign exchange reserves.
The rate charged by OMT was generally LL1,000 lower than that charged by brokers both legal and illegal. It was not until February 2022 that BDL allowed foreign exchange transactions to other money transfer companies— an option taken up by BOB Finance (Bank of Beirut Group, agent for Western Union), but not by CashUnited (Saradar Group, agent for MoneyGram).
When contacted, Bob Finance's customer service offered assurances that they had not been notified of any change in the way foreign exchange operations are conducted. However, the company's website showed a rate of LL46,000 to the dollar, more than LL10,000 below the market rate on Monday evening.