To facilitate and encourage small merchants ((owners of individual licenses)) and industrial and service companies, the Central Bank of Libya (CBL) announced Thursday, that it is to issue an debit card (MasterCard and Visa) with a value of 100,000 dollars annually, as of 1 March.
The decision, the CBL revealed, was made during a meeting of CBL Governor, Saddek El-Kaber with the concerned departments on Thursday.
Analysts say it is a long overdue decision as small businesses are unable to obtain their fair share of hard currency/letters of credit through their banks. They are often crowded out by big business and find the process burdensome. As a result they resort to purchasing their hard currency through the black market – thereby keeping the black market exchange rate high.
The new debit card pre-loaded with US$ 100, 000 will, critics say, facilitates the import process for small traders. It will also reduce the exchange rate of the dollar in the market. Moreover, rather than the traders and black-market currency exchangers keeping money outside the official banking system, this CBL move will redirect liquidity back to the official system, this, in turn, will help reduce the lack of liquidity at Libyan banks.