Iranian Rial

pokerplayer · January 6, 2017

On 2016-12-27 at 5:30 AM, gixxerfrog said:

Hey pp, just curious if u have heard anything else from ur friend over there? It's been awhile so I was wondering if (s)he figured whats going on yet with the rename and them talking about the zero(s). I think we get the best info from ppl on the ground. That's y I like that Adam has contacts over there. Hoping ur friend can find some news or figure out what all this means.

Hey Frog, I see his vehicle is home so when it's a little later I will call him.

pp

pokerplayer · January 6, 2017

Well went over for a coffee and got some interesting perspective that I had never thought about before.

- I was asked why everyone was so worried about Trump ? He said it's a great thing. The Iranian citizens, small and medium business are rushing to do what ? Trade in the Riel's for US $'s, which is taking them out of circulation !! Big business doe's not matter as their money is all electronic anyways. Trump will do what ever he wants anyways. So SB may be correct on the change this month

- His perspective and that of Iranian banker's differ on the dreaded meaning the "L" word. He asked across the pond what they are hearing and they are puzzled. So who came up with this meaning and made it official ? To most in Iran it means just that, "L" zero's, but off the rate, not the bill. He also figures they will drop 3 zero's to start and not 4 so as to pull in lots they cannot control or get at. Once it's down to a trickle, then drop 1 more. These are his thoughts and not cast in stone.

Not as much as I expected or hoped but it does put into question the dreaded "L" when used in articles. It just removes some of the sweat created whenever it's used. Never thought of it that way before.

Oh well now we have something to chew on, on throw out the "L" word in the trash. Who knows maybe some kid with pimples used it in this way and it just picked up steam.

pp

screwball · January 6, 2017

Chances that the final draft of the Banking Reform Bill and the Central Bank Bill will be approved by the Iranian Parliament by the end of President Hassan Rouhani’s first term in the summer of 2017 are relatively slim, the head of Majlis Economic Commission said.

“The government’s propositions regarding the revision of Banking Reform Bill and the Central Bank Bill will most likely not be communicated to the parliament by the end of the current government’s tenure,” Mohammad Reza Pour-Ebrahimi also said in a talk with Exim News website.

The lawmaker, however, assured that “we will follow up on the bills regardless”.

Pour-Ebrahimi had announced in late October that the longstanding reform bills would be finalized in the parliament before the end of the current fiscal year in March.

The lawmaker had also threatened that the Majlis will come up with its own version of the much-disputed Banking Reform Bill if the government fails to deliver them on time.

What is now referred to as the Banking Reform Bill first became law more than three decades ago under the moniker of Usury-Free Banking Law.

Noting that 33 years have passed since the original law came into effect, the head of the commission stressed that past governments and parliaments had failed to reform it. That is “in spite of the fact that the previous and current governments were reminded by the parliament to update the law to match the state of the economy”.

Pour-Ebrahimi stressed that “with the constant monitoring of businesses by Majlis Research Center, which focused on resolving the problems of the banking sector as a major economic priority”, the bill’s general outlines were approved in early fall.

“Now, the specifics of the bill are being reviewed,” he added.

Banking Reform Bill defines the duties of banks and non-bank credit institutions, and decrees that they must obtain a license from CBI. It explains all banking operations and services, as well as regulations for the establishment of branches of foreign banks, and sets limits to their investments.

The bill also obliges credit institutions to provide information, sets up a professional set of criteria for selecting new chief executives and board members, and makes provision for setting up internal risk and auditing committees.

On the other hand, the Central Bank Bill, whose law was first passed in 1972, aims to modernize banking regulations. Improving the independence of CBI, enhancing monetary policymaking and the CBI’s supervision over the money market are among its key goals.

As part of the bill, CBI would have more authority for setting policies and supervising banks and credit institutions.

Currency Market

Pour-Ebrahimi referred to a recent parliamentary meeting held earlier this week between Economy Minister Ali Tayyebnia and Central Bank of Iran Governor Valiollah Seif on fluctuations in the Iranian currency market.

“The establishment of a currency futures market was proposed as one of the necessities of the country’s economy, but now the central bank has announced that the measure requires more forex transactions and engaged bureaux de change and banks in the unofficial foreign exchange market,” he said.

The lawmaker stressed that the gap between the official and unofficial exchange rates in the Iranian market must not be allowed to widen.

Besides the free market exchange rate, Iran uses an official rate for state transactions. The widening gap between the official and free rates has sucked hard currency out of the formal banking system. In an effort to counteract this, the government has authorized some banks to trade at market exchange rates.

Pointing to regulations concerning transparency of information to prevent corruption, Pour-Ebrahimi referred to Note 6 of the Iranian Constitution’s Article 44 that obligates all public service entities, including municipalities and the Social Security Organization of Iran, to make their financial statements public.

screwball · January 6, 2017

International sanctions hampered Iran's ability to connect with the global banking network, but the country now has secured correspondent relations with 900 banks across the world, announced the minister of communications and information technology.

"Barely a year has passed since JCPOA [Iran's nuclear accord with world powers] was implemented, but we managed to establish ties with foreign banks with each passing month and now we have correspondent relations with 900 banks," Mahmoud Vaezi was also quoted as saying by Banker.ir.

On July 14, 2015, P5+1 (China, France, Russia, the United Kingdom, and the United States, plus Germany) and Iran reached a Joint Comprehensive Plan of Action regarding Iran's nuclear program.

October 18, 2015 marked its Adoption Day, the date on which the accord came into effect and participants began taking steps to implement their commitments. January 16, 2016, marks the Implementation Day of JCPOA.

However, since sanctions were lifted in January, the world's major banks continued to stay away because they fear being penalized by remaining US sanctions over issues such as money laundering. This has slowed Iran's efforts to rebuild its foreign trade and lure investment.

The minister said while the financial state of President Hassan Rouhani's administration is currently improving, "we will inject liquidity into the banks and insist that the banks do not take up [irrelevant] business ventures and allocate loans to serve the country's manufacturing output".

Speaking at an event in the northern province of Mazandaran, which was attended by businessmen, exporters and manufacturers, Vaezi commended the performance of state banks of the province in allocating loans to production units.

"The private banks must also support the private sector just like their public-sector peers," he added.

Reassuring manufacturers that the government is striving to solve the problems facing them such as the shortage of working capital and the prevalence of unnecessary regulations, the official warned producers against "expecting the government to solve their problems overnight".

Vaezi said all administrations that came to power since the 1979 Islamic Revolution have pursued the goal of supporting the private sector and the current government is no exception.

"The current administration has stressed strengthening the country by helping the private sector from the outset," he said.

"The private sector must gradually become strong enough to engage in exports and as long as we do not have exports, we will not know the true meaning of trade."

The World Bank in its latest analysis forecast Iran’s economy to grow at an annual average rate of 4.5% in 2016–18.

According to the bank, the oil and gas sector is projected to grow by 14.5% in 2016 up from 12.9% in the spring.

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screwball · January 6, 2017

5 minutes ago, screwball said:

The government’s propositions regarding the revision of Banking Reform Bill and the Central Bank Bill will most likely not be communicated to the parliament by the end of the current government’s tenure,” Mohammad Reza Pour-Ebrahimi also said in a talk with Exim News website.

Interesting because according to the last articles it had already been presented....

5 minutes ago, screwball said:

The lawmaker had also threatened that the Majlis will come up with its own version of the much-disputed Banking Reform Bill if the government fails to deliver them on time.

Yep that's because they have pre iously approved four zeros, but the cabinet puts forward a plan for one....yeah not going to work...

screwball · January 6, 2017

no mention of the bill to remove zeros.....

Edited January 6, 2017 by screwball

screwball · January 6, 2017

8 minutes ago, screwball said:

“Now, the specifics of the bill are being reviewed,” he added.

The government’s propositions regarding the revision of Banking Reform Bill and the Central Bank Bill will most likely not be communicated to the parliament by the end of the current government’s tenure,” Mohammad Reza Pour-Ebrahimi also said in a talk with Exim News website.

though you didn't have the bill.....

screwball · January 6, 2017

The privately-owned Ayandeh Bank, in a ceremony on Thursday, unveiled an open banking API portal called Finnotech, which is the first of its kind in Iran’s banking system.

Finnotech aims to provide developers with an opportunity to offer customized banking services based on their users’ needs.

The portal is also to give access to banking platforms to “anyone who thinks can solve a problem or benefit others”.

API, or application programming interface, is a technology protocol that allows diverse software components to communicate. More to the point, it allows even non-experts to develop applications that make use of whatever software components a given API taps into.

Abdolreza Sharifi, Ayandeh’s deputy for electronic banking services, believes that open banking is inevitable today, therefore the bank decided to take the lead and open the banks’ doors to innovative technologies.

“Finnotech currently offers 12 services that allow users make payments or transact money without requiring advanced technical knowledge, in a totally safe environment,” Hamed Qannadpour, CEO of eFarda e-Commerce Company, was quoted as saying by way2pay.ir on Thursday.

Hossein Mokhtarian, marketing director at eFarda, also noted that developers need to have a platform for the identification of users and the possibility of managing channels to start using the API service.

Stressing that even banks can use Finnotech’ services, Mokhtarian added that developers will be provided with a detailed documentation and technical advisory for using the portal.

Farzad Rahmani, founder of Chargon, also elaborated on how his startup is making use of API portal for offering efficient financial services to customers.

The startup has specialized in office management services.

“Now we allow large companies to make direct payments and have a more efficient supervision over their accounts,” he said.

Bahamta, a payment gate, Mehrabane, a crowdfunding app, and Cinema Ticket are other notable startups using Finnotech services.

CBI’s Stance

Ali Kermanshah, the Central Bank of Iran’s deputy for innovative technologies, welcomed the move and said the source of innovation has changed from the supply side to the demand side.

“Now it’s the customer who is seeking innovative services,” he said.

Aboutaleb Najafi, director of Informatics Services Corporation, also called on innovators to focus on the development of innovative business models, as “it is the only way startups can be successful in competition with banks”.

“Unfortunately, we use regulation to suppress innovations since we are not capable of dealing with them,” he added.

ISC, affiliated with CBI, is the leading developer of financial solutions in Iran. Almost all the platforms used in Iran’s banking sector are developed by the company, including Shetab, the nationwide interbank network.

In another development, the CBI announced on Thursday that it has expanded its supervision on electronic services offered by banks.

The CBI called on bankers to be cautious about using innovative technologies and asked them to ensure that these technologies are fully compatible with the regulations, especially in terms of remaining secure from money-laundering activities.

“Those who fail to meet the requirements will be legally prosecuted and subsequently be blacklisted by the CBI,” which means they will never be able to collaborate with banks,” CBI’s statement reads.

The central banker is expected to authorize the operation of fintech companies in the near future.