The future begins now with the transition to comprehensive digital transformation
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With steady steps, the Central Bank continues to implement the banking reform strategy, one of the main objectives of which is to achieve digital transformation in the banking sector, which the Central Bank began in 2016 with clear stages included in its first, second and third strategies.
During the past two years, cooperation between the Central Bank and the government, with the personal support and follow-up of the Prime Minister and the chairmanship of the Digital Transformation Committee, was an essential step to activate and accelerate the transformation to digital government and the transition from a cash economy to a digital economy, focusing on developing payments within Iraq and using technology to improve financial inclusion, developing information technology, establishing digital banks, using artificial intelligence in banking services, and using modern technologies in loans, compliance, risk management, combating money laundering and terrorist financing, and combating banking fraud.
The results during 2023 and 2024 recorded a qualitative leap in the volume of transactions in electronic payment operations and the use of modern banking technologies, as the rate of digital transformation and electronic payment rose to 48.5% compared to 20% in the past years. This is an indicator that confirms the success of the plans and procedures adopted to achieve a major transformation with a distinguished national effort for digital transformation and electronic payment. This joint effort by the cadres of the Central Bank, the government, banks and electronic payment companies has clearly contributed to possessing an advanced infrastructure to implement and accommodate electronic payment tools and various financial services.
The banking reform has now entered the phase of transformation to digital banks, and the Central Bank is currently examining and auditing about 70 requests to license new digital banks according to the precise controls and conditions adopted by the Central Bank. This constitutes a real and promising start for technical banking development in Iraq to bridge the technical gap with the countries of the world in this field. This facilitates the provision of smart banking services, reduces the chances of fraud and corruption, and provides important data on the nature of transactions, their control, and compliance.
Therefore, digital banks are a new stage of digital transformation and banking reform. We hope that the Central Bank will soon take the first step by licensing digital banks that show the results of the examination, audit and study that they are committed to the applicable controls and conditions. In this context, and in confirmation of the Central Bank's strategy for digital transformation for the next two years, His Excellency the Governor of the Central Bank confirmed yesterday that the future of digital transformation in Iraq begins now and that the current stage is witnessing a major development in the electronic payment system by increasing the number of ATMs, which exceeded 4,000 ATMs, the number of electronic cards issued exceeded 17 million cards, and the number of POS devices is about 63,000 devices. The number of credit wallets has also increased, and the financial inclusion rate has increased to 40% after it was 20% two years ago. Iraqi banks are today witnessing qualitative transformations in their banking operations, especially with regard to future banks that will transform from traditional entities to smart digital platforms and issue digital financial identities that facilitate financial transactions without the need for banks.
The financial and banking system will witness the decline of paper currencies to be replaced by digital payments for central banks, and that the Central Bank is moving to create its own digital currency, to gradually replace the paper process as is happening in some central banks in the world, as well as working to establish a data center in Iraq similar to the major centers in the world, as it is an indispensable part of the digital economy and the basis for artificial intelligence, applications, big data analysis and the Internet, and that the Central Bank of Iraq has begun steps in this direction.
Rafidain: Committed to developing digital transformation
Rafidain Bank affirmed its commitment to developing the financial and banking sector and enhancing its role in supporting digital transformation and financial inclusion.
The bank’s statement stated that “as part of its ambitious strategy to enhance its leading position in the Iraqi banking environment, Rafidain Bank participated in the ninth annual exhibition and conference on finance and banking services in Iraq,” stressing “its commitment to developing the financial and banking sector and enhancing its role in supporting digital transformation and financial inclusion.”
He pointed out that “the bank showcased the latest digital banking solutions it offers, through its own pavilion at the exhibition, where it provided electronic payment services via banking applications, in addition to innovative solutions that enable individuals and companies to conduct their financial transactions easily and securely.”
Rashid Bank warns against trading in digital currencies and Forex activity
Today, Thursday, Rashid Bank warned against trading in digital currencies and Forex activity with unlicensed entities.
The bank's media office said in a statement followed by Al-Masry, "Based on the directives of the Central Bank of Iraq, we warn all citizens against using digital payment tools to deal with forex and currency activities on their own account or on behalf of others, whether directly or indirectly with their cards or wallets."
The bank called for “the necessity of avoiding dealing with unlicensed entities that promote these activities, exposing citizens to legal procedures and the loss of their rights.”
Al-Sarraj: US embassy statement confirms its major interference in Iraq's affairs
Political analyst Ibrahim Al-Sarraj confirmed today, Thursday, that the US embassy's statement confirms its major interference in Iraq's affairs.
Al-Sarraj said in a statement to Al-Maalouma Agency, “The recent statement issued by the US embassy represents a clear interference in the work of the Iraqi government and the executive authority,” noting that “this contradicts international laws that respect the autonomy of states.”
He explained that "the US Democratic Party is putting pressure on the Iraqi government by awarding corporate contracts to institutions owned by US President Donald Trump, who in turn supports the Kurdistan Regional Government to achieve common interests between them."
He added, "Through these pressures, Trump seeks to ensure the continuation of oil exports from the region, and to oblige the Iraqi government to pay the extraction costs of $16 per barrel to the American oil companies affiliated with him, which reflects the interconnected economic and political interests between Washington and Erbil."
He pointed out that "the current US administration is trying to impose its hegemony over Iraq, including determining the nature of its relations with the Islamic Republic of Iran and the armed factions, in addition to influencing the situation in Syria, in an attempt to expand its regional influence through Baghdad."
In a related context, he considered that "the US Embassy's statement regarding the call that took place between Iraqi Prime Minister Mohammed Shia al-Sudani and the US Secretary of State represents direct interference in Iraqi affairs, not limited to the executive authority only, but extends to the legislative authority as well."
He pointed out that "the discussion of the recent amendments to the budget by a delegation from the US embassy with a delegation from the Iraqi parliament is a clear violation of Iraqi autonomy, especially since there is no law that allows them to interfere in the internal affairs of the state, which raises questions about the extent of the independence of political and economic decisions in Iraq in the face of these external pressures."
Central Bank of Iraq signs agreement with Emirates Islamic Bank
The Central Bank of Iraq announced the signing of a banking agreement with Emirates Islamic Bank, which is considered one of the highest-rated Islamic banks, and is rated (A+) according to the international Fitch agency.
Thus, Emirates Islamic Bank is a distinctive addition to the banking relations that the Central Bank of Iraq has established with advanced regional and international banks in recent years.
The agreement includes joint cooperation on several axes, the most important of which are:
- Exchange of experiences in the field of developing the Islamic banking sector.
- Providing payment services in UAE Dirhams to Iraqi banks and expanding their correspondent accounts network.
- Cooperation between Iraqi banks and Emirates Islamic Bank, under the supervision and support of the Central Bank of Iraq, to formulate a mechanism that will allow individual customers of Iraqi banks in the near future to invest (partially) in Islamic bonds issued by Emirates Islamic Bank or other issuers with a similar credit rating in the United Arab Emirates.
It is noteworthy that the Central Bank of Iraq announced in August of last year the start of a new phase of foreign transfer operations in a step aimed at enhancing the diversity of currencies and facilitating international transfer operations. This announcement came after reaching an agreement on the mechanisms for regulating dealings in the euro, the Chinese yuan, the Indian rupee, the UAE dirham, and other global currencies.Central Bank of Iraq
Media Office
February 27, 2025
Kurdistan banks will take their share of sanctions.. Economist explains the reasons
Today, Thursday (February 27, 2025), economic expert Hevidar Shaaban explained the reasons for imposing US sanctions on a number of banks in the Kurdistan Region.
Shaaban said in an interview with Baghdad Today that "within the framework of coordination between the US Treasury Department and the Central Bank of Iraq, sanctions will be imposed on banks in the region, including banks participating in the project of my account for the salaries of employees in Kurdistan."
He added, "This operation is to control currency smuggling in some banks in the region, control money laundering, illegal transactions, and the structural organization process of banks."
Earlier this February, two informed sources reported that the Central Bank of Iraq would prevent local banks from dealing in dollars.
Reuters quoted the two sources as saying: "The Central Bank of Iraq will prevent 5 local banks from dealing in dollars at the request of the US Treasury."
The two sources added, "Three payment services companies will be banned from dealing in dollars, according to the US Treasury's request."
They pointed out that "America submitted its request due to serious monetary violations and the smuggling of dollars out of the country."
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US official: Trump tied Iraq to Iran pressure
Former US Assistant Secretary of State for Near Eastern Affairs, David Schenker, said, on Thursday, that President Donald Trump included Iraq in his maximum pressure campaign against Iran.
Speaking at the second day of the 2025 Erbil Forum, Schenker stated that “Washington’s policy toward the Kurdistan Region has benefited the Region in multiple ways, including continued US support and the presence of American troops in Iraqi Kurdistan.”
He also confirmed that the US will maintain its annual $20 million funding for the Peshmerga forces.
Regarding the Trump administration’s stance on Iraq, Schenker said, "I don’t think Trump was particularly focused on Iraq, but he considered it part of his broader maximum pressure campaign against Iran."
US pressures Baghdad: Iraqi FM reveals details
On Thursday, Iraqi Foreign Minister Fouad Hussein revealed several critical developments concerning Iraq’s internal and external affairs, including armed factions, US pressures, relations with Syria, and Israeli threats.
In an interview with Al-Hadath TV, Hussein said the United States had presented Iraq with issues related to increasing pressure on Iran. However, he emphasized that "Baghdad seeks to maintain a balance in its relations between Washington and Tehran."
Hussein also mentioned that Washington had raised the possibility of halting gas imports from Iran. Despite this, he expressed hope that strategic dialogue with the new US administration would continue, noting there were "no concerns" in dealing with it.
Armed Factions Issue
Hussein revealed that the US had sent unofficial messages regarding the status of armed factions in Iraq. He highlighted that "Israeli threats of an attack inside Iraq are still ongoing," adding that "the timing for the withdrawal of US troops from Iraq has not changed."
On the issue of disarming factions, Hussein stated that it was a matter requiring internal discussion, noting that "these armed groups do not pose a threat to the presence of coalition forces."
He also warned of the "dangers of ISIS," pointing out "suspicious movements by the terrorist group that raise concerns within the government."
Syrian Relations
Concerning Iraq’s stance on Syria, Hussein confirmed that Iraq’s position towards the new Syrian administration was not influenced by Iran.
"However, there are different viewpoints from various political factions," he said.
Hussein also highlighted that Iraq, like any other nation, has diverse opinions on global matters, “especially regarding the Syrian issue,” adding that Iraq would "invite Syrian President Ahmed al-Sharaa to attend the Arab summit in Baghdad."
In response to regional security concerns, Iraq deployed armored military forces along the border from Al-Qaim in the western part of the country to the Jordanian border, following the fall of former Syrian President Bashar al-Assad in December.
Despite ongoing debates, the withdrawal of US and international coalition forces from Iraq remains a contentious issue, despite discussions that began with Washington over two years ago.
Moreover, the close ties between the current Iraqi government and Tehran continue to be a source of friction with the United States, despite Baghdad’s repeated assurances of its commitment to maintaining a balanced foreign policy and enhancing communication with Washington.
MP calls on government to complete budget schedules and send them to parliament
Representative Faisal Al-Naili called on the government, today, Thursday, to expedite the completion of the budget tables and send them to the House of Representatives for approval, stressing the need to include all financial allocations in the 2025 budget to avoid any delay in its approval.
Al-Naili said in a statement to / Al-Maalouma / agency, that “the government has not sent the 2025 budget tables yet,” stressing that “there is no justification for this delay and disruption in sending the tables.”
He stressed that "the government is required to quickly take the necessary measures to ensure that the budget reaches Parliament as soon as possible, which contributes to accelerating the process of approving it in accordance with the approved legal and constitutional frameworks."
He pointed to "the importance of completing all items of the 2025 budget and including all financial details to ensure the smooth flow of government work and prevent the disruption of development projects."
It is noteworthy that the House of Representatives previously voted on the budget amendment law and sent it to the government with the aim of sending the budget tables.
Iraq agrees to supply Lebanon with crude oil, with immediate cash payment
Lebanese media sources quoted informed sources as saying that the Lebanese delegation to Iraq (consisting of IDAL Chairman Mazen Sweid and Brigadier General Hassan Shaqir) agreed with Iraqi officials to renew the fuel supply contract to operate the Electricité du Liban plants with some amendments to its implementation mechanism.
The sources indicated that Iraq will supply about 2 million tons of crude oil after it had been supplying fuel oil, in exchange for paying the price of the shipments in cash and immediately, unlike the three previous versions of the contract that included Lebanon paying the price of the shipments through services provided in Lebanon to the Iraqis, provided that the previous arrears amounting to 2 billion dollars would be addressed through the platform between the two countries to provide the agreed-upon services.
By the end of 2024 and until the formation of the new government, a huge amount has accumulated on Lebanon for the price of fuel shipments. Lebanon has only paid $118 million out of $2 billion. This accumulated amount is the result of three copies of renewed contracts between the two parties.
The fourth version of the contract includes the supply of 2 million tons of crude oil and payment for it in cash.
These renovations were carried out with “provisions” and “sympathy” even though Lebanon was not paying the cost of the shipments. Despite Iraqi facilities, Lebanon was unable to pay the bills.
These facilities stipulated that Lebanon would pay the price of fuel in Lebanese pounds, and that the amounts would be deposited in the Iraqi government’s account at the Bank of Lebanon, and would be spent on services for Iraqis (including hospitalization and medical treatment for Iraqis in Lebanon) in Lebanon exclusively.
The Lebanese newspaper Al-Akhbar quoted the sources as saying that the platform for these services is nearing completion and will be implemented soon, and therefore Lebanon can no longer look for justifications and excuses for defaulting on payments. This default on payments has been reflected in the renewal of the contract for the fourth time.
She pointed out that the Lebanese representatives faced great difficulty in the negotiations, as the Iraqi government needed to prove Lebanon's good faith in payment, especially after all these facilities and delays. Therefore, it was agreed that the payment for the shipments this time would be in cash and immediately, not on the platform, meaning that payment would be in dollars via a transfer from the Bank of Lebanon abroad.
It is worth noting that Lebanon's reliance on Iraqi shipments is very vital. In the past four years, Lebanon has been producing electricity using mainly Iraqi fuel, in addition to hydroelectric plants and some shipments purchased by the Ministry of Energy recently.
The contract with Iraq is a swap contract, whereby Lebanon obtains fuel oil that is not suitable for use in power plants, but exchanges it with a foreign company for quantities that are usable in plants. On average, it obtained one ton of usable fuel for every two tons of Iraqi shipments. The equation changes with changes in prices and quality. In this sense, the price of the shipments is not the only amount that Lebanon owes, as it also had to pay the price of the swap, but the payment mechanism was also in ways that did not impose a direct price on it, meaning that it paid the cost from the quantities of crude oil that it did not pay for.
The amount paid by Lebanon to Iraq, amounting to $118 million, was in 2023, as during that period the Central Bank of Lebanon stopped transferring the funds due for four fuel shipments worth $132 million for the year 2023, and stipulated that the implementation of the transfers require the issuance of a law by the House of Representatives to cover them, and the inclusion of the necessary appropriations to cover the price of the shipments in the 2024 budget, noting that the number of shipments received and due for payment for the year 2023 amounted to 8 shipments and there are 12 other shipments for the year 2024, all of which have arrived.
Now, Lebanon has renewed the contract after changing the quantity to crude oil instead of fuel oil, and after changing the payment mechanism. This poses a challenge for the Lebanese government, as the price of the shipments must be paid through the Central Bank of Lebanon, knowing that the Electricité du Liban has about $300 million in collections that it keeps to buy fuel for the plants under public tenders that are held periodically.
The newspaper wondered whether the Central Bank of Lebanon would agree to pay for the accumulated shipments and the upcoming shipments, or would it say that this would create a cash problem because it would arrange an injection of the lira into the market?
Or will he inform officials that there are no budget allocations to cover the payment of these shipments, and that he is not lending the state to pay them? Noting that this detail has always been the main detail in dealing with the electricity problem in the past five years, that is, since the monetary and banking collapse at the end of 2019 until today. Anyone who claims that the available options are otherwise is delusional.
The problem is that Lebanon is not able to operate the existing power plants, meaning that the problem is not in the regulatory bodies nor in investment in the sector...
Coordination Framework moves to respond to Rubio's warning messages
The Coordination Framework in Iraq is preparing to hold an emergency meeting within the next two days to discuss the details of the phone call that took place between US Secretary of State Marco Rubio and Iraqi Prime Minister Mohammed Shia al-Sudani.
The meeting comes amid escalating tensions after informed sources reported that the US Secretary of State had sent warning messages that could carry direct threats. The leaders of the framework believe that these messages may reflect Washington's intention to increase pressure on Baghdad, especially with regard to relations with Iran.
The move appears to reflect growing concern within Iraqi political circles about the implications of the new US policy under President Donald Trump’s administration, which focuses on a “maximum pressure” strategy against Tehran. The meeting appears to be an attempt to formulate a unified position that protects Iraq from any potential sanctions that may affect economic and political figures or entities.
During the phone call, the US State Department urged the Iraqi government to ensure its energy independence, which was confirmed by the department's spokeswoman, Tammy Bruce, in an official statement.
She pointed out that Rubio and Al-Sudani discussed the importance of reducing dependence on Iran in this vital sector, while stressing the resumption of the operation of the Iraqi-Turkish pipeline as soon as possible.
This call reveals Washington's desire to limit Iranian economic influence in Iraq, as the latter depends on Iranian gas to generate about 40% of its electricity, according to reports by the International Energy Agency for 2024.
This pressure is part of a broader policy aimed at reshaping regional balances, but it could force the Iraqi government to make difficult choices between maintaining its relations with Tehran and meeting US demands.
The leaders of the Coordination Framework see the content of Rubio’s messages as a direct threat to the stability of the political system in Iraq. Speculation is rife in Baghdad about the possibility of US sanctions that could include local banks or prominent figures, which could exacerbate the economic crises that the country is already suffering from.
This perception indicates the sensitivity of the internal political situation, as some believe that any American escalation could lead to reactions from the armed factions loyal to Iran, which have great influence in the Iraqi arena. This dynamic shows the complexity of the scene, as Al-Sudani tries to maintain a delicate balance between external pressures and internal stability.
Former US Assistant Secretary of State David Schenker confirmed during his participation in the Erbil Forum on Thursday, February 27, 2025, that Iraq is not among the main priorities of US foreign policy at the present time. He explained that the US focus is on confronting Iran, and that Iraq is seen as a secondary arena in this conflict.
This statement reinforces the impression that Washington is using Iraq as a tool in its broader strategy against Tehran, without fully paying attention to its internal needs. This raises questions about the seriousness of the strategic partnership between the two parties, especially with the ongoing security and economic challenges facing Baghdad.
According to statements by Foreign Minister Fuad Hussein, Iraq seeks to maintain a balance in its relations with the United States and Iran, while emphasizing its commitment to the security agreement with Tehran. Hussein indicated in a television interview that Baghdad is working to protect its national interests amid increasing international pressure.
This position reflects the great challenge facing Al-Sudani in managing complex foreign relations, as Iraq has a long border with Iran that extends for more than 1,400 kilometers, making cooperation with it a geopolitical necessity. However, reliance on American support, whether military or economic, puts the government in an unenviable position.
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