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Banks in Egypt Ordered to Stop Using Prepaid Cards in International Transactions
While no official comment has been released so far, the sites of socialwork in Egypt have released news that banks are ordered to stop using prepaid cards in international transactions, both for cash withdrawals and for purchases online in any foreign currency.
Suspended Use of Prepaid Cards
There have been publications in which states that the use of prepaid cards has been suspended, both for purchases online that out of Egypt, in any foreign currency other than the Egyptian Pound, and some banks have confirmed this.
While there have been no official comments or statements so far, informed banking sources have revealed to Agency a directive in recent days to stop international transactions with prepaid cards outside Egypt or for purchases onlinewith the use of direct debit cards in force Linked to customer account, credit cards outside Egypt and electronic payment.
Blocking and Paying Customers
Sources spoke of blocking and paying the customer any purchases made to them electronically (online), both from inside and outside Egypt, in any foreign currency that enters into international transactions due to trading in a currency other than the local one.
Dollar Shortage Crisis
Egypt has been facing a dollar shortage crisis since the first quarter of last year due to the outflow of foreign funds.
Negotiations with the International Mary Fund
In the context of negotiations with the International Mary Fund, the Fund agreed that the Central Bank of Egypt should switch to a flexible policy in the foreign exchange market. The price of the US dollar has increased in rates record since last March until now.
Reduction in the Pound
Over the past seven years, the Central Bank of Egypt has announced 4 major reductions in the pound, the first of which was in November 2016, when it was decided to reduce the pound from levels of 8.88 pounds per dollar to levels of 15 77 pounds to the dollar, a drop of 78%, while official prices now exceed 30 pounds to the dollar.
Fee Increase for Cash Withdrawals Outside Egypt
Banks have also raised the fee rate for cash withdrawals outside Egypt from ATMs, up to 13% of the total transaction value, ranging from 10% as a currency exchange fee to 3% as a fee for using an external machine, in plus additional fees of up to £50 per transaction.