The Central Bank of Egypt (CBE) decided Tuesday to ban foreign currency transactions at local points of sale (POS).
The CBE demanded banks urgently modify software used in POS machines to reject operations in foreign currencies whether through credit, debit, or prepaid cards. The CBE permitted the use of foreign currency in transaction conducted by payment cards issued by banks abroad. It also provided a two-month concessionary period for banks to modify the software applicable to their POS and converter devices.
According to the CBE, this decision came in light of the discount made on transactions conducted at local POS in foreign currency at some commercial centres, through credit cards issued in local currency from local banks.
This decision violates item No. 111 in the CBE and banking sector law No. 88 of 2003. It stipulates that the sale and purchase of goods and services in Egypt must be conducted in Egyptian pounds according to the procedures set by the executive regulations of the law, unless there are contradicting international agreements or another contradicting law.