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The writing on the image says The file to remove zeros enters advanced stages ... and a plan to replace the Iraqi currency in early 2027.
MP Murtadha Afween confirmed on Monday that the project to remove zeros from the Iraqi currency has not yet moved to the implementation phase, indicating that the project does not represent a direct solution to the crises plaguing the Iraqi economy.
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Afween told the Information Agency that "the issue of removing zeros from the currency has not yet reached the implementation phase," explaining that "the project has not contributed to addressing the crises facing the Iraqi economy."
He added that "removing zeros from the currency, if it proceeds, should not be considered a sufficient measure to address the economic challenges," noting "the importance of focusing on issues directly related to the country's economic and financial reality."
Afween pointed out that "addressing the economic crises requires concrete steps and measures targeting the root causes of the problems, in addition to developing solutions for issues affecting financial and economic stability," emphasizing that "monetary measures alone are insufficient to address the accumulated economic problems." Earlier, The Media Line network revealed in a report that the Iraqi government will begin issuing a new currency with zeros removed at the beginning of 2027.
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Sources told Al-Mustaqilla that the plan to remove zeros from the Iraqi currency is entering advanced stages, with a plan to replace the currency in early 2027.
Informed sources revealed to Al-Mustaqilla that the file of removing zeros from the Iraqi dinar and reissuing the currency has entered advanced stages of study and discussion within government departments, noting that a plan currently circulating aims to begin the process of replacing the old currency with a new currency starting from 2027, in the event that the required governmental, legislative and technical approvals are completed.
The sources said that the currency restructuring file is no longer limited to economic and technical discussions within the Central Bank of Iraq, but has become subject to study at the level of the Prime Minister’s office, within a plan related to the mechanism for moving from the current currency to a new monetary issuance after removing the zeros.
According to information obtained by Al-Mustaqila, the discussions are currently focused on developing a clear implementation plan for the replacement process, the transitional period during which the two currencies will be traded, the mechanisms for banks and government institutions to deal with the new currency, as well as the procedures related to bringing the largest possible amount of cash outside the banking sector into the formal financial system.
The sources confirmed that 2027 is among the current proposals as a possible start date for the process of replacing the old currency with the new one, but stressed that the date will not become officially effective before the completion of the governmental and legislative process and obtaining the required approvals.
The sources expected that the file would witness developments at the Cabinet level in the coming period, followed – if the project is approved – by moving to the required legislative path before reaching the implementation stage.
Mustafa Sand's statements bring the issue back to the forefront.
The new information coincides with previous statements by Iraqi Communications Minister Mustafa Sanad, who said during August that a decision regarding the removal of zeros and the change of currency had been decided at the political level, and linked the move to bringing out hoarded funds and returning them to the economic cycle and the banking system.
Sand said that the currency change process could encourage holders of large amounts of cash to reveal their money when exchanging old banknotes, allowing some of the liquidity outside banks to be brought back into the financial system, as well as dealing with money whose owners cannot prove its sources or bring it legally into the exchange process.
Sand’s statements had sparked widespread controversy, especially after the government said on August 17 that the Cabinet had not made a final decision at that time to remove the zeros, and that implementing such a step required a legislative process that went through the House of Representatives.
The Central Bank denies printing... but outlines the course of any future project
On August 26, 2026, the Central Bank of Iraq issued a statement explicitly denying reports that it had printed quantities of new Iraqi currency with zeros removed in preparation for its release into the markets.
However, the bank’s statement did not close the door to a future currency restructuring project, as it confirmed that any such project, if an official decision is made regarding it, will be subject to multiple legal, regulatory and technical stages, and that it will be officially announced and a transition period will be determined that allows citizens, banks and institutions to exchange the currency in an organized and safe manner.
This means that the official denial issued by the Central Bank so far relates to the existence of a new currency that has been printed and is ready for circulation, and not to the cancellation of the project idea or the exclusion of discussing it in the future.
Al-Mustaqilla has been following the case since its inception.
Al-Mustaqilla had published a series of reports in recent days on the issue of removing zeros and restructuring the currency, in which it quoted sources close to decision-making circles as saying that the matter was under serious study, despite the fact that no final government announcement had been issued yet.
Information obtained by “Al-Mustaqila” today confirms that the file is still in existence and under study within the relevant institutions, and that the discussions have moved to more advanced details regarding how to implement the replacement process and not just the idea in principle.
However, the sources confirmed at the same time that the project’s transition to the actual implementation phase will remain linked to the final decision of the Council of Ministers, the legislative procedures required by the file, and the position of the Central Bank, as it is the entity responsible for managing and issuing currency and monetary policy in Iraq.
Why does the government want to change the currency?
The proposed plans suggest that the project’s objectives are not limited to reducing the number of zeros and facilitating accounting and monetary operations, but could also include reorganizing the large amount of cash that exists outside the banking system.
Iraq is one of the economies that relies heavily on cash transactions, and a large percentage of the currency in circulation is outside of banks.
The latest data circulating on monetary indicators indicates that the volume of currency circulating outside the banking sector has reached more than 100 trillion dinars, which reflects the extent of the hoarding phenomenon and reliance on direct cash.
Currency replacement – if the government adopts clear control mechanisms – would encourage hoarders to deposit their money through banks or exchange centers within a specific time period, giving financial authorities greater ability to know the movement of money and the sources of some large cash blocks.
The process can also support anti-money laundering and anti-financing measures if it is accompanied by the application of clear rules regarding deposits, large sums, and sources of funds.
Replacement, not cancellation, of the value of citizens' money
From an economic standpoint, removing zeros does not mean that citizens' money will lose its value or that the dinar will automatically become more expensive.
If it is decided – for example – to remove three zeros, then renaming the monetary unit could make every thousand dinars of the old currency equivalent to one dinar of the new currency, in parallel with repricing salaries, prices, debts, contracts and balances at the same rate.
The main objective of the process is to simplify monetary categories, accounts and transactions, not to achieve an automatic increase in the purchasing power of the dinar.
Expected transitional phase
If the project is approved, the authorities will likely adopt a transitional phase during which the old and new currencies will circulate simultaneously before the old version is gradually withdrawn.
The central bank had already confirmed that any future decision of this kind would include a transition period to ensure that citizens, banks and institutions could exchange currency in an orderly manner while preserving all financial rights and obligations.
The process will require resetting banking systems, ATMs, accounting software, pricing, contracts and government records, as well as a broad awareness campaign to prevent the transition from being exploited for fraud or speculation.
The coming days could be decisive.
According to sources from “Al-Mustaqilla”, the next stage will be important in determining the final course of the project, while the governmental, legal and technical aspects of the currency replacement plan continue to be studied.
The sources confirmed that there is a trend to push the file towards completing the necessary procedures, with the picture to become clearer after the Cabinet's position and the legislative process are decided.
Accordingly, the information available so far indicates that the project to change the currency and remove zeros is moving within Iraqi institutions, and that 2027 is being considered as a possible start date for the replacement process according to the ideas being discussed. However, this has not yet turned into an official, announced, and binding date from the Central Bank or the Council of Ministers as of the date of this report.
The Iraqi public is waiting for any official announcement in the coming days that could move one of the most sensitive financial issues in the country from the stage of studies and discussions to the stage of decision and implementation
Money exchange companies under the microscope of the Central Bank of Iraq: strict oversight and anticipated updates.
The relationship between the Central Bank of Iraq and exchange companies and offices is heading towards a more stringent stage in monitoring the movement of funds and transfers, in conjunction with official moves to reorganize the sector and raise compliance and governance requirements, according to a source close to the exchange market and official data reviewed by Al-Mustaqilla.
The source, who preferred not to reveal his name, told Al-Mustaqilla’s correspondent that exchange companies and offices are currently subject to stricter monitoring, and that the coming period may witness updates in the mechanisms for linking and exchanging information with the Central Bank, allowing for more accurate monitoring of operations and transfers, especially foreign transactions.
The Central Bank has not yet announced details about a new electronic system to link exchange companies or when it will be implemented, and Al-Mustaqilla was unable to independently verify the nature of the updates referred to by the source.
But the bank's actions over the past three months support a clear trend towards tighter oversight of the sector.
On June 10, the Central Bank asked exchange companies of categories (A and B) and companies that mediate the buying and selling of foreign currencies to provide it with data relating to their bank accounts, and said that the measure comes “for regulatory and supervisory purposes.”
On July 6, the bank withdrew the licenses of Al-Rawajeb, Saba and Al-Nitaq companies to mediate the buying and selling of foreign currencies, attributing the decision to violations of sector regulation controls.
Two weeks later, Central Bank Governor Nizar Nasser Hussein held a meeting with the directors and chairmen of exchange companies, and said that the next phase would witness new initiatives and activities to expand their businesses, in parallel with raising compliance and governance levels in accordance with international standards.
These measures coincided with broader commitments made by Iraq under a joint action plan with the Financial Action Task Force (FATF) to strengthen the fight against money laundering and terrorist financing. In August, the bank issued a new circular on behavioral indicators for transactions suspected of being linked to money laundering or terrorist financing, following a training program in which banking and non-banking financial institutions participated.
Exchange companies are already subject to special anti-money laundering and counter-terrorism financing regulations issued by the Central Bank in 2024, as part of its supervision of non-bank financial institutions.
These steps indicate that the next phase may not be limited to regulating currency sales, but may extend to increasing oversight of the sources of funds, transfer routes, and beneficiaries.
The extent of the expected change remains linked to the instructions that will be issued by the Central Bank, particularly whether it will adopt a more centralized system to link exchange companies and monitor their transactions directly.
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