Iraq to Ban All Cash Withdrawals in US Dollars: What You Need to Know
Big changes are coming to Iraq's financial system. Starting January 1, 2025, Iraq will ban cash withdrawals and transactions in US dollars, a significant policy shift designed to curb financial crimes and prevent the misuse of its hard currency reserves. This move, confirmed by multiple sources, including the Central Bank of Iraq, marks a crucial step in the country's efforts to combat illicit financial activities.
Why the Ban on US Dollar Cash Withdrawals?
The primary reason behind Iraq's ban on US dollar cash withdrawals and transactions is to address the pervasive issue of financial crimes. The Central Bank of Iraq has been increasingly frustrated by the misuse of its hard currency reserves, particularly in relation to illicit cash flows, allegedly including flows from Iraq to Iran. Iraq will ban cash withdrawals and transactions in U.S dollars as of Jan. 1 2025 to directly tackle these issues. This action aims to prevent the misuse of its hard currency reserves.
What Happens After January 1, 2025?
Starting Janu, cash withdrawals and transactions in U.S. dollars will be prohibited across Iraq. After this date, using US dollars for cash transactions will no longer be possible. The implication is that all transactions will need to be conducted using the Iraqi Dinar or through electronic transfers that can be tracked. This measure should dramatically improve transparency and accountability within the Iraqi financial system. The Central Bank of Iraq plans to halt U.S. dollar cash withdrawals and transactions beginning Jan. 1, 2025, to curb illicit cash flows.
Central Bank Action Against Banks
Further demonstrating its commitment to cracking down on financial crimes, Iraq’s central bank has decided to prohibit five local banks from conducting transactions in U.S. dollars. This action aims to further restrict the movement of illicit funds and enforce stricter financial regulations.
Key Takeaways: Iraq's Dollar Ban
- Effective Date: January 1, 2025.
- What's Banned: All cash withdrawals and transactions in US dollars.
- Reasoning: Combating financial crimes and preventing the misuse of hard currency reserves.
- Central Bank Involvement: Imposing restrictions on banks to ensure compliance.
Stay informed about this significant policy change as it unfolds. Iraq is set to implement a ban on cash withdrawals and transactions in US dollars starting on Janu, a move intended to reshape its financial landscape.