Syria embraces credit and debit cards

Household names, Visa and MasterCard, to colour spending practices of the Baathist state.

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By  John Irish Published  March 10, 2003

In a bid to modernise its banking system, the Syrian government announced plans on March 08 to launch credit and debit card systems throughout the country.

According to Syrian officials, the move towards greater economic openness could pave the way for the introduction of private banks. At present, a state-run bank will be responsible for issuing international debit cards, while another unit will process transactions for holders of credit cards issued outside Syria.

“We will start with [issuing international] debit cards at the beginning as we move toward allowing the issuance of a full credit card,” said Ghassan Al Rifai, Syria’s Economic Minister.

Syria's Real Estate Bank (REB) will now accept MasterCard and Visa cards issued abroad, although due to legislation barring transactions in foreign currency, REB will initially rely on the Lebanese Fransabank to carry out foreign exchange dealings on its behalf.

The current banking infrastructure in Syria means that debit cards cannot technically be launched at the moment. However, according to Tareq Sarraj, chairman of the Commercial Bank of Syria, discussions with Visa are taking place, that will see the process begin in the next few months.

While this appears to be a move to liberalise the country’s banking sector, the restrictions on transferring Syrian pounds outside the state means that only holders of foreign currency will be issued a debit card.

Nevertheless, this latest venture by the Baathist authorities follows a host of other economic reforms championed by Syrian leader Bashar Al Assad since he came to power in 2000.

“The road to achieve the role sought from banks in pushing the wheel of national economy is long and rugged,” said Rifai.

Rifai claimed that a decision to license private banks would be taken once a report by the central bank had been concluded, but that he expected to license five private sector banks by the end of the first quarter of 2003. Syria nationalised the banking sector during the 1960s.

The adoption of credit cards is seen as a step toward encouraging more tourists to the country and follows preliminary figures from the Syrian Ministry of Tourism last month, indicating that the number of tourism arrivals in 2002 had exceeded the four million mark.

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