In a bid to develop its financial sector amid sanctions, Sudan plans to introduce Visa payment systems, mobile banking and is negotiating with United States (U.S) lender Citibank about setting up shop in the country.
Omar Amrabi, head of Electronic Banking Services (EBS) at Sudan’s central bank said that the Bank of Khartoum, Qatar National Bank, and United Capital Bank had received approval to start using Visa systems, which would be launched in three weeks time. Six other banks have applied for approval and were awaiting, he added.
Over time, Sudan has been dealing with liquidity shortages amid strict control of foreign currency. With the new partnership, the country will be able to benefit from Visa’s world-class payment technology, as well as support financial inclusion and economic growth. “We are working closely with select financial institutions in Sudan to progress the introduction of Visa payment solutions in the country,” the company said in a statement.
The Visa systems are expected to be limited to foreign currency payments and capped at $3,000, which is the maximum amount of foreign currency travellers are allowed to take out of the country. Also, Sudan will have its first set of automated teller machines (ATMs) for international withdrawals installed at hotels.
In addition to the Visa partnership, Sudan’s Nile Bank in December signed an accord with American software firm Oracle Corp, for the provision of a mobile banking platform. The platform will enable citizens to perform transactions from their homes, providing them with a swift and easy method of banking. Meanwhile, the Sudanese government has also been in talks with U.S. financial services provider Citibank about entering Sudan, to assist in cash transfers set to replace the current subsidy system.
Due to existing sanctions on Sudan and its listing as a state sponsor of terrorism by the U.S. in 1993, commercial and financial transactions in the country have been restricted. The listing has discouraged foreign financial investors and banks from doing business with the North African nation.
European banks including HSBC Holdings and BNP Paribas in 2015 and 2014 respectively, were accused of performing business transactions with Sudan which was a sanctioned country. The entities had to pay a fine of over $10 billion to settle cases brought by the U.S.
Also, the U.S has blocked every funding coming from the International Monetary Fund (IMF) and World Bank into the country with claims of Sudan having links with terrorists. However, Washington has indicated that it will be removed from the blacklist following the overthrow of former leader Omar al-Bashir last year.
Nevertheless, the Sudanese government is taking steps to improve the country’s financial sector. With the introduction of new reforms, Sudan is poised to see an increase in foreign currency inflows to the country, which could act as a springboard for its economic revival.
By Faith Ikade.