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Payments department activities
June 20, 2023
The most important activities carried out in the Iraqi payment system during the years 2015/2016/2017
:diamonds: Modernizing the Iraqi Payments System:
The Iraqi payment system with all its components RTGS, ACH, CSD was updated in 2015 in order to comply with international standards and regulations in the field of payments for the purpose of accommodating the increasing volume of transactions that take place through this system to easily comply with various banking systems.
:diamonds: IBAN (International Bank Account Number) on the payment system (RTGS- ACH): It was established for the purpose of unifying bank account numbers in all banks operating in Iraq, which contributes to improving the level of financial and banking services, clearing services and settlement of payments locally and internationally. This is done by unifying the composition and specifications of the account number within the banking sector, and the formula for the unified bank number for Iraq has been chosen, as the IBAN number consists of 23 ranks.
:diamonds: Implementation of the IRPS retail payment system infrastructure project, consisting of:
The national exchange: which supports the clearing between banks for transfers made by customers and transactions that take place through the use of automatic teller machines and points of sale through credit cards that are linked to the bank account.
Mutual payment system via mobile phone, where funds are transferred through electronic wallets without the need for a bank account, as well as transfers for bill payment and shopping can be made.
:diamonds: Automating the work of internal control and adding the level of a supervisory system to activate the supervisory role of the RTGS system in the Central Bank of Iraq:
For the purpose of activating the oversight role in the RTGS system, a new function was added by adding special fields, where the participant was able to check the types of payment orders through the system without the need for paper checks. The auditing authority has special powers that cannot be viewed or acted upon by another authorized person, such as the entry authority Or authorized to authenticate, and the audit process is later after the completion of the transfer, and the audit process can be performed for previous dates in the system. The main purpose of this feature is to indicate the audited entries from the unaudited entries of the senior management of the participants in the system and to reduce the effort and speed in implementing the internal audit process.
:diamonds: IBCS (Inter Bank Clearing System)
It is a system for internal clearing exchange for government banks (branches inside and outside Baghdad), which do not have a comprehensive banking system. This system enables the participating bank branches to send and receive files of payment orders and instruments among themselves in an automatic way. Transfers made through this system.
:diamonds: Standardization of security specifications for sukuk:
In order to provide greater protection for checks drawn on banks, reduce counterfeiting and ensure the validity of the issuance of checks, standardization of security specifications for checks drawn on all banks was adopted by choosing six types of security specifications without formality and colors, taking into account the selection of light colors when printing checks to avoid blurring the image of the check when printing Send it through the electronic check clearing system.
:diamonds: Work with the World Bank to assess and prepare the Iraqi payments system in line with international standards PFMIs (Principles for Financial Market Infrastructures)
Based on the principle of compliance of the Iraqi payment system with international standards, work has been done with the World Bank for the purpose of assessing the readiness of the payment system in line with the principles of the infrastructure of financial markets PFMIS, which consists of (24) standards and among the most important principles (credit risk management, operational risks, liquidity risks, legal foundations governance, final settlement, etc.).
Salaries Localization Project:-
Based on Cabinet Resolutions No. (313 of 2016, 281 of 2017) and based on the promotion of financial inclusion in Iraq, which includes the generalization of banking services to all segments of society, the Central Bank of Iraq is keen to meet all requirements for implementing the process of settling salaries in banks and applying the collection system In implementation of government directives in this regard, the project includes opening bank accounts for employees of ministries and government institutions. A specific number of banks have been selected within specific criteria, which issue cards according to international standards linked to the bank account, in addition to evaluating them financially and technically according to the modern banking services that will be provided to the employee in a manner Safe and secure, which contributes to creating a strong competitive environment to provide the best services to the public. A number of uncles have been issued that regulate the process of paying salaries. The salaries of the employees of the Central Bank in its two branches (Baghdad-Basra) have been localized to be an exemplary experience. So.
:diamonds: Connecting comprehensive banking systems:
For the purpose of facilitating the flow of work and updating data electronically and without human intervention, a project to link banking systems has been implemented, where a number of banks have been linked to the Iraqi payment system, and work is underway to link all banks operating in Iraq, according to the time plan set by this bank with the rest of the banks, and a deadline has been set for the banks Which started work to complete the linking requirements for the first stage at the end of 2017, provided that the rest of the banks complete the linking requirements at the end of 2018.
:diamonds: Developing the CSD system by adding the following:
» Issuing Islamic Certificates of Deposit (ICD)
It is a type of transfer that will be traded and auctioned on the CSD system between Islamic banks and the Central Bank in exchange for achieving implicit profits under the Murabaha contract, and that the use of Islamic Certificates of Deposit (ICD) requires the existence of a contract between the Central Bank and Islamic banks on the one hand and with stock exchanges on the other hand.
:diamonds: Investment Module:
Where the investment restrictions for time deposits (7,14,30) on the CSD system are implemented directly by the banks.
:diamonds: Developing financial markets by activating the secondary market through the Trading System
For the purpose of activating the secondary market by providing a market or several markets for the exchange of various trading operations related to buying and selling orders for government bonds, the trading unit has been added to the CSD system as a separate unit linked to it to settle trading operations.
The importance of the trading system is represented in activating the secondary market and facilitating the circulation of primary issues and converting them into cash when needed.
:diamonds: The regional system for clearing and settlement of inter-Arab payments:
A regional system has been established to settle inter-Arab payments related to economic and investment transactions across borders between Arab countries by linking Arab central banks. Consultant (BOOZ Company), and the design was approved and presented to the governors of Arab central banks.
:diamonds: Formation of the Iraqi National Payments Council:
In view of the expansion of the work of the Iraqi payment systems and the association of their business with external parties on the one hand and internal parties of institutions, ministries and agencies on the other hand, and for the purpose of developing strategies for developing payment and settlement systems and following up on their implementation, upgrading international best practices and ensuring the safety and efficiency of these systems in the financial markets and the development of infrastructure. The Board of Directors of this bank approved the establishment of the Iraqi National Payments Council headed by the Central Bank and the membership of a number of ministries and departments from the public and private sectors, which works as an advisory circle to support the Central Bank of Iraq in defining its objectives and clarifying its strategic direction.
:diamonds: Strengthening regional and international cooperation with the Central Bank of Iran:
In light of the joint cooperation of both countries (the Republic of Iraq and the Islamic Republic of Iran), a document was concluded between the Central Bank of Iraq and the Central Bank of Iran in order to unify efforts in joint cooperation in the banking and financial fields, organizing financial transfers electronically, exchanging experiences and all kinds of knowledge in issues related to the exchange of information and regulatory legislation In accordance with international requirements, agreements and covenants with which both countries have entered into
:diamonds: Financial Inclusion:
Financial inclusion is the enhancement of the access and use of all segments of society, including the marginalized and the poor, of financial services and products that suit their needs so that they are provided to them in a fair and transparent manner and at reasonable costs. The concept of financial inclusion includes protecting the rights of consumers of financial services and encouraging them to manage their money and savings properly, with the aim of Some people avoid resorting to informal channels and means that are not subject to oversight and supervision, and often adopt high prices. Financial inclusion indicators have been identified in terms of measuring the availability of financial services that represent supply on the one hand, and measuring the extent of their use and exploitation on the other hand, represented by the demand side. Therefore, financial inclusion aims to expand access to financial services, by working on developing both sides of supply and demand, and indicators have been sent to the concerned authorities for the purpose of measuring financial inclusion in Iraq, and Iraq has participated in the regional working group to enhance financial inclusion in the Arab countries in 2016 .
:diamonds: Automating the work of ministries and government institutions:
In order to keep abreast of developments in payment systems in the world, the Central Bank seeks to automate all financial transfers between state departments and institutions and to collect receivables through the Iraqi payment system by using payment orders instead of checks to reduce the risks resulting from transferring funds and counterfeiting checks and shifting from manual work to electronic work.
:diamonds: Technical evaluation of banks:
A questionnaire was prepared covering the technical aspects, electronic services and basic banking systems, through which the level of banking efficiency in providing electronic services to customers is inferred. This information is fielded and integrated with the results of the financial evaluation of banks for the purpose of standardizing the results and presenting them to the public.
:diamonds: IRPSI retail payment system: The actual launch of the (Iraqi Islamic) bank with the national exchange (retail payment system) took place after the completion of all administrative, technical and organizational procedures and the completion of the linking operations.
:diamonds: Payment through payment orders: for the purpose of transferring all financial transactions from paper transactions (check and cash) between the Central Bank and external parties to electronic payment, where work has been started using electronic payment orders (CT) through the electronic clearing system C-ACH to organize the work of committees Purchases in the process of paying dues to all third parties instead of using cash and checks.
:diamonds: Automating the work of ministries and government institutions (activating electronic payment tools): holding workshops (the General Authority for Customs, the General Authority for Taxes) regarding the activation of electronic payment and collection tools to familiarize them with the system and mechanisms used for electronic collection, and it was agreed to start at one of the ports of the General Authority for Customs using payment orders Electronically (CT) to evaluate the experience and find out the problems and obstacles to avoid them when circulating to the rest of the customs outlets.
:diamonds: The Nationalization of State Employees’ Salaries Project: In implementation of the directives of the General Secretariat of the Council of Ministers under Resolution (313) of 2016, and after the success of the process of nationalizing the salaries of the employees of the Central Bank of Iraq, the project was circulated to the rest of the ministries and government institutions and all their formations, and the salaries of employees of the Oil Pipelines Company and the Audit Bureau were localized Finance and work is underway to localize the rest of the ministries and state institutions.
:diamonds: Completion of linking with universal banking systems: Abu Dhabi Bank has been linked to both systems (RTGS, C-ACH).
https://cbi.iq/news/view/2361
June 20, 2023
Payments department activities
The most important activities carried out in the Iraqi payment system during the years 2015/2016/2017
:diamonds: Modernizing the Iraqi Payments System:
The Iraqi payment system with all its components RTGS, ACH, CSD was updated in 2015 in order to comply with international standards and regulations in the field of payments for the purpose of accommodating the increasing volume of transactions that take place through this system to easily comply with various banking systems.
:diamonds: IBAN (International Bank Account Number) on the payment system (RTGS- ACH): It was established for the purpose of unifying bank account numbers in all banks operating in Iraq, which contributes to improving the level of financial and banking services, clearing services and settlement of payments locally and internationally. This is done by unifying the composition and specifications of the account number within the banking sector, and the formula for the unified bank number for Iraq has been chosen, as the IBAN number consists of 23 ranks.
:diamonds: Implementation of the IRPS retail payment system infrastructure project, consisting of:
The national exchange: which supports the clearing between banks for transfers made by customers and transactions that take place through the use of automatic teller machines and points of sale through credit cards that are linked to the bank account.
Mutual payment system via mobile phone, where funds are transferred through electronic wallets without the need for a bank account, as well as transfers for bill payment and shopping can be made.
:diamonds: Automating the work of internal control and adding the level of a supervisory system to activate the supervisory role of the RTGS system in the Central Bank of Iraq:
For the purpose of activating the oversight role in the RTGS system, a new function was added by adding special fields, where the participant was able to check the types of payment orders through the system without the need for paper checks. The auditing authority has special powers that cannot be viewed or acted upon by another authorized person, such as the entry authority Or authorized to authenticate, and the audit process is later after the completion of the transfer, and the audit process can be performed for previous dates in the system. The main purpose of this feature is to indicate the audited entries from the unaudited entries of the senior management of the participants in the system and to reduce the effort and speed in implementing the internal audit process.
:diamonds: IBCS (Inter Bank Clearing System)
It is a system for internal clearing exchange for government banks (branches inside and outside Baghdad), which do not have a comprehensive banking system. This system enables the participating bank branches to send and receive files of payment orders and instruments among themselves in an automatic way. Transfers made through this system.
:diamonds: Standardization of security specifications for sukuk:
In order to provide greater protection for checks drawn on banks, reduce counterfeiting and ensure the validity of the issuance of checks, standardization of security specifications for checks drawn on all banks was adopted by choosing six types of security specifications without formality and colors, taking into account the selection of light colors when printing checks to avoid blurring the image of the check when printing Send it through the electronic check clearing system.
:diamonds: Work with the World Bank to assess and prepare the Iraqi payments system in line with international standards PFMIs (Principles for Financial Market Infrastructures)
Based on the principle of compliance of the Iraqi payment system with international standards, work has been done with the World Bank for the purpose of assessing the readiness of the payment system in line with the principles of the infrastructure of financial markets PFMIS, which consists of (24) standards and among the most important principles (credit risk management, operational risks, liquidity risks, legal foundations governance, final settlement, etc.).
Salaries Localization Project:-
Based on Cabinet Resolutions No. (313 of 2016, 281 of 2017) and based on the promotion of financial inclusion in Iraq, which includes the generalization of banking services to all segments of society, the Central Bank of Iraq is keen to meet all requirements for implementing the process of settling salaries in banks and applying the collection system In implementation of government directives in this regard, the project includes opening bank accounts for employees of ministries and government institutions. A specific number of banks have been selected within specific criteria, which issue cards according to international standards linked to the bank account, in addition to evaluating them financially and technically according to the modern banking services that will be provided to the employee in a manner Safe and secure, which contributes to creating a strong competitive environment to provide the best services to the public. A number of uncles have been issued that regulate the process of paying salaries. The salaries of the employees of the Central Bank in its two branches (Baghdad-Basra) have been localized to be an exemplary experience. So.
:diamonds: Connecting comprehensive banking systems:
For the purpose of facilitating the flow of work and updating data electronically and without human intervention, a project to link banking systems has been implemented, where a number of banks have been linked to the Iraqi payment system, and work is underway to link all banks operating in Iraq, according to the time plan set by this bank with the rest of the banks, and a deadline has been set for the banks Which started work to complete the linking requirements for the first stage at the end of 2017, provided that the rest of the banks complete the linking requirements at the end of 2018.
:diamonds: Developing the CSD system by adding the following:
» Issuing Islamic Certificates of Deposit (ICD)
It is a type of transfer that will be traded and auctioned on the CSD system between Islamic banks and the Central Bank in exchange for achieving implicit profits under the Murabaha contract, and that the use of Islamic Certificates of Deposit (ICD) requires the existence of a contract between the Central Bank and Islamic banks on the one hand and with stock exchanges on the other hand.
:diamonds: Investment Module:
Where the investment restrictions for time deposits (7,14,30) on the CSD system are implemented directly by the banks.
:diamonds: Developing financial markets by activating the secondary market through the Trading System
For the purpose of activating the secondary market by providing a market or several markets for the exchange of various trading operations related to buying and selling orders for government bonds, the trading unit has been added to the CSD system as a separate unit linked to it to settle trading operations.
The importance of the trading system is represented in activating the secondary market and facilitating the circulation of primary issues and converting them into cash when needed.
:diamonds: The regional system for clearing and settlement of inter-Arab payments:
A regional system has been established to settle inter-Arab payments related to economic and investment transactions across borders between Arab countries by linking Arab central banks. Consultant (BOOZ Company), and the design was approved and presented to the governors of Arab central banks.
:diamonds: Formation of the Iraqi National Payments Council:
In view of the expansion of the work of the Iraqi payment systems and the association of their business with external parties on the one hand and internal parties of institutions, ministries and agencies on the other hand, and for the purpose of developing strategies for developing payment and settlement systems and following up on their implementation, upgrading international best practices and ensuring the safety and efficiency of these systems in the financial markets and the development of infrastructure. The Board of Directors of this bank approved the establishment of the Iraqi National Payments Council headed by the Central Bank and the membership of a number of ministries and departments from the public and private sectors, which works as an advisory circle to support the Central Bank of Iraq in defining its objectives and clarifying its strategic direction.
:diamonds: Strengthening regional and international cooperation with the Central Bank of Iran:
In light of the joint cooperation of both countries (the Republic of Iraq and the Islamic Republic of Iran), a document was concluded between the Central Bank of Iraq and the Central Bank of Iran in order to unify efforts in joint cooperation in the banking and financial fields, organizing financial transfers electronically, exchanging experiences and all kinds of knowledge in issues related to the exchange of information and regulatory legislation In accordance with international requirements, agreements and covenants with which both countries have entered into
:diamonds: Financial Inclusion:
Financial inclusion is the enhancement of the access and use of all segments of society, including the marginalized and the poor, of financial services and products that suit their needs so that they are provided to them in a fair and transparent manner and at reasonable costs. The concept of financial inclusion includes protecting the rights of consumers of financial services and encouraging them to manage their money and savings properly, with the aim of Some people avoid resorting to informal channels and means that are not subject to oversight and supervision, and often adopt high prices. Financial inclusion indicators have been identified in terms of measuring the availability of financial services that represent supply on the one hand, and measuring the extent of their use and exploitation on the other hand, represented by the demand side. Therefore, financial inclusion aims to expand access to financial services, by working on developing both sides of supply and demand, and indicators have been sent to the concerned authorities for the purpose of measuring financial inclusion in Iraq, and Iraq has participated in the regional working group to enhance financial inclusion in the Arab countries in 2016 .
:diamonds: Automating the work of ministries and government institutions:
In order to keep abreast of developments in payment systems in the world, the Central Bank seeks to automate all financial transfers between state departments and institutions and to collect receivables through the Iraqi payment system by using payment orders instead of checks to reduce the risks resulting from transferring funds and counterfeiting checks and shifting from manual work to electronic work.
:diamonds: Technical evaluation of banks:
A questionnaire was prepared covering the technical aspects, electronic services and basic banking systems, through which the level of banking efficiency in providing electronic services to customers is inferred. This information is fielded and integrated with the results of the financial evaluation of banks for the purpose of standardizing the results and presenting them to the public.
:diamonds: IRPSI retail payment system: The actual launch of the (Iraqi Islamic) bank with the national exchange (retail payment system) took place after the completion of all administrative, technical and organizational procedures and the completion of the linking operations.
:diamonds: Payment through payment orders: for the purpose of transferring all financial transactions from paper transactions (check and cash) between the Central Bank and external parties to electronic payment, where work has been started using electronic payment orders (CT) through the electronic clearing system C-ACH to organize the work of committees Purchases in the process of paying dues to all third parties instead of using cash and checks.
:diamonds: Automating the work of ministries and government institutions (activating electronic payment tools): holding workshops (the General Authority for Customs, the General Authority for Taxes) regarding the activation of electronic payment and collection tools to familiarize them with the system and mechanisms used for electronic collection, and it was agreed to start at one of the ports of the General Authority for Customs using payment orders Electronically (CT) to evaluate the experience and find out the problems and obstacles to avoid them when circulating to the rest of the customs outlets.
:diamonds: The Nationalization of State Employees’ Salaries Project: In implementation of the directives of the General Secretariat of the Council of Ministers under Resolution (313) of 2016, and after the success of the process of nationalizing the salaries of the employees of the Central Bank of Iraq, the project was circulated to the rest of the ministries and government institutions and all their formations, and the salaries of employees of the Oil Pipelines Company and the Audit Bureau were localized Finance and work is underway to localize the rest of the ministries and state institutions.
:diamonds: Completion of linking with universal banking systems: Abu Dhabi Bank has been linked to both systems (RTGS, C-ACH).
https://cbi.iq/news/view/2361
