Iran Integrating Bank Card System With 5 Countries

EghtesadOnline: Iran is in various stages of integrating its bank card system with five countries for the citizens of both sides to be able to use their bank cards in each other's countries, the head of Information Technology Department at the Central Bank of Iran announced.

News ID: ۷۴۱۳۳۹

06 May 2017

"Establishing bank card integration with countries that have a national payment network is a priority, which will create greater ease [of doing business]," Nasser Hakimi also told IRNA.

Hakimi noted that from among the five nations, Russia's bank card integration with Iran is more imminent

Russia has a nationwide payment network as does Iran, and given the geopolitical implications and importance of ties between the two countries, it is a sensible target for establishment of banking ties, Financial Tribune reported.

Hakimi said Iran-Russia bank card system integration is to be "finalized in the next few months".

The official referred to Japan as another important target country with which negotiations are in the final stages.

Technical steps needed to connect the bank card systems of the two Asian countries have been completed and the only thing left to do is to formalize it by signing the required agreements.

On linking the bank card systems of Iran with Azerbaijan and Iraq in order to offer banking services to tourists of both sides, the CBI official admitted that progress is coming off slowly as the two neighboring countries are bereft of a nationwide payment network.

China is reportedly on the list of target countries for bank card integration as well.

"Considering that China also has a national payment system, negotiations with the country is on the agenda," he said.

The inability of Iranian banking system to join the international card systems as a result of sanctions had created big hurdles for both foreigners spending money in Iran and Iranians shopping abroad, as the latter had to deal with the hassle of carrying large amounts of cash with them.

Defying Restrictions

After the implementation of the nuclear accord in early 2016, Iran has been formally negotiating with many countries and international companies in order to connect its banking network with the global system and offer Iranian citizens and businessmen broader services.

However, as pointed out by the managing director of payment systems at the central bank, one big and persisting barrier has been sanctions imposed by the US against Iran, which were first imposed after the Islamic Revolution became victorious in 1979 and are in place to this date.

"Many international payment companies are American or have major American shareholders and we cannot work with them because of primary sanctions," Davoud Mohammad Beigi had previously told IRNA.

In order to bypass these sanctions and work with other nations in spite of them, CBI has established case-by-case ties with various countries, especially neighboring countries in the Middle East, instead of directly trying to reconnect with global entities.

On the other hand, Informatics Services Corporation, a leading developer of banking and payment solutions in Iran, launched a formal bid to seek partnership with top payment solution suppliers to develop a national platform for the management of international card payments in October.

These suppliers include Japan's JCB and China's UnionPay in the short term, while Visa and MasterCard have been eyed for long term.