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7.2 Forex platform
Iran’s central bank launching ‘Diba’ platform to supervise banks’ operations in forex
Iranian forex platform Nima surpasses €7.1bn in liquidity
The Central Bank of Iran (CBI) has launched a new financial platform dubbed “Diba” to supervise banking operations in foreign exchange nationwide, IBENA has reported the CEO of the state-owned Informatics Services Corporation as saying.
According to the information disclosed, Diba will play a role in the regulation of the foreign exchange market, similarly to “Nima” and “Shaparak”, two other financial mechanisms launched by the national lender in recent years against a backdrop of market volatility and disruption caused by US sanctions.
“The Diba [system] is a regulatory platform like Shaparak, developed to regulate the function of payment service provider (PSP) companies,” Aboutaleb Najafi said, adding: “Banks have begun to offer open banking services, which allows [software] developers to create applications and offer innovative financial instruments [and mechanisms].”
When Diba is fully operational, banks will be required to integrate their internal systems with the mechanism so that the CBI can observe account-based transactions, the CEO added.
The new system would allow the CBI to have oversight of inter-bank transactions as opposed to card-to-card transactions, which it presently has. Diba will not be in competition with so-called open banking operations where banks interact with third party PSPs. Whilst the system will play a part in these operations, it function is to allow the CBI to access accounts.
Forex traders in Iran in the past week saw the price of the US dollar versus the Iranian rial (IRR) rise some 5% amid the several days of social unrest brought about by the government’s sudden petrol price hike. Prior to this depreciation, the rate had pretty much enjoyed stability for around three months.
"Because of the sensitivity of foreign exchange trades and the significance of CBI regulation in the market, Diba will be used to assist the CBI in having ‘both eyes’ on the market,” the official Najafi added.
On February 28, Iranian officials announced that an over-the-counter (OTC) trading platform would commence in a bid to quell black market trading of currencies. However, to date the introduction of the system has been delayed.
Iran’s forex management system for imports and exports, formally known as the Forex Management Integrated System (Nima), has to date supplied more than €7.197bn in hard currency for imports of basic goods, Mehr News Agency has reported.
Nima was launched earlier last year in a bid to retain capital for import and export trade within a formal trading system while Iran fights the economic consequences caused by the reimposition of heavy US sanctions on Tehran, including the severe collapse in the value of the Iranian rial (IRR). Despite teething problems, use of the ringfenced system has grown with more and more companies being given permits to sell and buy currency.
The expansion of Nima follows a push by the Central Bank of Iran, announced
35 IRAN Country Report December 2019 www.intellinews.com
