Close to 300 exchange bureaus are operating in the market including 20 affiliated to banks. Apart from the bank-affiliated exchanges there are 17 participating banks, according to Mehdi Gohar-Rostami.
He said the scope of the market has broadened across the country and moneychangers that are member of this market offer forex services in 19 provinces.
Gohar-Rostami noted that the market is set to expand further as 50 more exchange bureaus have applied for permits and are in the listing process, Fars News Agency reported.
"We believe the people and currency market participants in the country will benefit from the regulated market in the coming year [starts March 21]," he said.
The regulated market is touted as another government move to underpin discipline in the chaotic currency market. It is a spot market dealing in wholesale currency in cash. Trade is processed by authorized exchange shops and agent banks that operate as brokerage. A regulatory body affiliated to the Central Bank of Iran oversees the deals.
The market seeks to create and organize an open and transparent system where foreign currency is be traded via an electronic platform.
Major Players
In April 2018, a company was officially registered to manage and supervise the regulated market. It is a private company comprising major stakeholders, namely the Association of Private Banks and Credit Institutions, Association of Bureaux de Change Operators, representatives from public banks, Iran Fara Bourse (the junior market for trading securities and other financial instruments).
Challenging the controversial role of unofficial currency dealers in gouging rates and limiting the role of currency market speculators are seen as key roles of the market.
The regulated forex market began quoting forex rates publically in December. "Currency market participants have welcomed its role as a reference source for quoting forex prices," Gohar-Rostami said.
"Prices are determined based on supply and demand mechanism via an electronic platform. After discovery, prices are communicated to the public at 15-minute and 30-minute intervals."
Rules for launching the market (the first of its kind) in Iran were approved in January 2018 by the Money and Credit Council – the top financial decision-making body headed by the CBI boss.
The inauguration of the market was postponed several times by the CBI as a small number of moneychangers joined initially and the regulator wanted a bigger participation of banks and moneychangers. The CBI required that the market should open with participation of 120 moneychangers and seven banks.