Major Egyptian banks including Commercial International Bank, Arab Bank and Banque Misr have suspended the use of local-currency debit cards abroad, as the country’s foreign currency woes worsen.
CIB, Egypt’s largest private bank, informed accountholders by text message that effective Tuesday their debit cards could only be used for Egyptian pound transactions within the country.
Arab Bank stopped international transactions for debit cards, according to a statement on its website, while a customer representative for state-owned Banque Misr told Bloomberg that the bank was implementing similar measures.
Banque du Caire, Credit Agricole and QNB Alahli took similar actions, they told customers in messages. Credit cards can still be used.
Similarly, Reuters reported earlier in October that Arab African International Bank and Arab International Bank had suspended the use of Egyptian pound debit cards outside the country, citing a shortage in foreign exchange.
Stabilising the pound has come at a cost in recent months, draining the economy of foreign exchange through a drawdown of commercial banks’ net foreign assets, which shrank in August by over 5% from the previous month to $13.1bn, according to Cairo-based HC Research.
International Monetary Fund managing director Kristalina Georgieva warned that Egypt will “bleed” precious reserves unless it devalues its currency again while praising other steps that the country has taken to revive its stricken economy.