Central Bank Restricts Trusts' Ability to Transfer Large Sums of Currency

To transfer larger amounts, trusts must first have their actual currency transfer capacity approved by the Central Bank.

According to Ambassador Arjan, the Central Bank has considered a new mechanism to monitor the activities of trusts, according to which, foreign exchange intermediaries must prove their operational capacity in a more limited stage before transferring large amounts. According to this mechanism, a certain amount is transferred first, and after the complete approval of the operation by the central bank, it will be possible to transfer more amounts.

This decision has been taken with the aim of dealing with the phenomenon of empty reading and preventing the registration of currency transfers without their actual realization; An issue that can cause difficulties in the process of providing import currency and delay the access of commercial actors to foreign exchange resources.

How does blank reading hurt business?

Due to the banking restrictions caused by the sanctions, the trustees are partially responsible for the transfer of export earnings and the settlement of Iran's commercial payments. However, the activity of these intermediaries faces a problem when there is a gap between the declared commitment and the actual transfer of currency.

In such a situation, a financial operation may be registered or approved, but the currency in question does not reach the destination at the appointed time or it is not possible to use it for import. In addition to disrupting foreign payments, this situation can also affect the supply of goods and raw materials.

Accordingly, the new mechanism of the central bank focuses on the practical examination of the ability to transfer currency before increasing the volume of trust activities. In this way, intermediaries must prove their performance in the early stages to access higher transfer ceilings; An approach that can prevent heavy obligations from being handed over to intermediaries who lack sufficient capacity.

The return of more than 10 billion dollars from the currency of the trusts

The issue of monitoring trusts has become more important in a situation where the return of foreign exchange resources and their allocation to imports has become one of the important axes of the country's foreign exchange policy.

Abdul Naser Hemmati, the Governor General of the Central Bank, announced on October 2 that more than 10 billion dollars of the currencies held by the trusts have returned to the country and have been allocated for import. He also announced the continuation of follow-ups to return another part of the resources.

On the other hand, Zabihullah Khodayian, the head of the country's General Inspection Organization, announced in August that a trust did not return 200 million dollars from the country's resources and left Iran. This issue once again highlights the necessity of careful monitoring of foreign exchange resources entrusted to intermediaries and follow-up of their obligations.

The return of deferred currencies and preventing the repetition of such cases are two complementary parts of the regulatory policy. In addition to tracking unreturned resources, controlling the performance of trusts before handing over more amounts can reduce the possibility of forming obligations without operational support.

The necessity of monitoring without disrupting payments

The effectiveness of the new central bank mechanism depends on how it is implemented. Determining clear criteria for confirming the initial transfer, specifying the review time and how to increase the ceiling of the trusts' activity are among the factors that are important in the implementation of this policy.

Merchant payments may be delayed if the approval process takes too long; Therefore, effective supervision should reduce the risk of foreign exchange resources and maintain the possibility of timely fulfillment of import obligations.

In general, making the transfer of higher amounts conditional on proving the real power of the trusts is a step towards strengthening the supervision of the currency transfer network. This approach, if implemented accurately and accompanied by continuous monitoring of sources, can help reduce possible violations and increase the certainty of the realization of currency transfers.