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cards currently work with Iran.
The long-awaited move by the Central Bank of Iran (CBI) would make Russia the first country to accept Iranian bank cards since the Islamic Revolution of 1979, which saw US-based card companies such as Visa and MasterCard driven out of Iran.
The two sides are keen to conduct trade in national currencies, "though the plan is facing hurdles mostly due to fluctuations in forex rates [in Iran]," Behrooz Olfat, head of TPO's Europe and North America Department, said to Iranian media.
The programme has long been pushed by the Iranian side, while ​Russia has remained publicly sluggish​ ​on the programme. In 2019, Russia’s ambassador to Tehran, Levan Dzhagaryan, said Russia and Iran’s banking systems will be connected “soon.”
It was not until the 1990s that Iran started issuing its own internal cards, which work under the Shetab electronic banking clearance and automated payments system.
The Mir Card, although only introduced in 2015, had some 176 Russian lenders using its system as of January this year, with 97% of ATMs and more than 75% of payment terminals accepting the card.
All Iranian banks and credit institutions have been required by a CBI directive to connect to Shetab. ATMs are prevalent across all of Iran’s cities and towns. The number was in 2016 estimated at more than 39,000.
So far, only a handful of Iranian banks have invested in chip and pin technology. They include Bank Shahr “City Bank” and Bank Mellat. Iranian retailers, meanwhile, still have little knowledge of the system.
The merging of the banks is believed to be seen by officials as part of Iran’s realisation of the much-delayed Palermo convention on anti-money laundering (AML) and countering the financing of terrorism (CFT). When completed the merger will mean significant oversight from regulators in the country, and it will be welcomed by the international Financial Action Task Force (FATF) that has subjected Iran to special measures for slowness in applying AML/CFT requirements to loans.
8.1.6 ​Bank news
State banks in Iran continue to cut costs by selling off branches surplus to requirements
State-owned Iranian banks are continuing with cost-cutting strategies that hinge on shutting down high street banks viewed as surplus to requirements, according to an economy minstry report cited by ​Donya-e Eqtesad.​
Bank Melli Iran (MBI), Bank Mellat, Bank Sepah (sometimes wrongly associated with the Islamic Revolutionary Guard Corps, or IRGC) and Bank Tejarat (Trade Bank) are among those closing branches.
The state lenders have reportedly sold off branch assets for IRR280tn ($1.2bn at the free market exchange rate, but $6.7bn at the official rate) since January 2018 to private developers. The buildings are typically turned into restaurants or are torn down to make way for apartment complexes.
In the period stretching from the start of President Hassan Rouhani's first term in 2013 to the end of 2017, the state banks sold IRR135tn of commercial real estate assets, the report noted.
38​ IRAN Country Report October 2020 www.intellinews.com