On the Last Day of Currency Exchange: Huge Deposits and Complexities Facing Gray Areas

Al-Ahdaath has reported details of the last day for currency exchange in the Shendi locality of the River Nile state. Observations revealed that banks were operating with great enthusiasm and high ethics from employees when dealing with clients, showing clear seriousness despite the large number of people still wishing to deposit funds and open accounts. In addition, there was the security and police protection in place, and the city’s shops continued dealing in old currency until 5 PM, preparing to transfer it directly to the banks.

Ibrahim Mahmoud Al-Layli, the branch manager of Omdurman National Bank in Shendi, stated that the currency exchange process has gone smoothly from the start until now. He mentioned that special windows were set up outside the branch for currency exchange and collection, such as at the cultural club, the Shendi water department, and some villages west of the Nile from Tayba to Kubuta, Al-Nourab, Al-Matma, and distant villages like Kaboushiyya in the north. He added that these efforts were accompanied by an extensive initiative and the mobilization of staff, resulting in the opening of around 6,000 accounts.

He expressed hope that the final day, according to the decisions of the Central Bank of Sudan, would go well. In a statement to the Khartoum Media Association delegation visiting Shendi, he confirmed that the exchange process had been very successful, revealing that approximately 27 billion Sudanese pounds had been deposited into the Central Bank of Sudan from the beginning of the exchange process until December 29.

However, Al-Layli emphasized that the challenge would come after the currency exchange. He stressed the need for citizens to adapt because the money supply had significantly decreased, with the 500-pound note no longer in circulation, which had represented a considerable portion of the money supply. Additionally, the newly introduced 1,000-pound note was in limited circulation. Al-Layli predicted a shortage of cash liquidity in the near future and warned of negative consequences if citizens did not handle the situation well.

He pointed out that there might be multiple prices for goods and services, with one price for bank transfers and another for cash. He also anticipated some negative practices but asserted that if people dealt with the situation positively, it would lead to the development of electronic payments and significantly shift people’s behavior. He expressed hope that neither the Central Bank nor the state would face pressure to reverse these decisions, explaining that if issues arose, the decision could be reconsidered.

He confirmed that banking applications were excellent, effective, safe, and easy to use, though he added that they needed to be practiced by clients. He mentioned that inter-bank transfers were in their final stages but ruled out the possibility of these transfers being free of charge, justifying that banks were keen on protecting their interests as they deal with depositors’ funds, especially given the high operational costs.

Al-Layli emphasized that the currency exchange process would contribute to the economic recovery, stating that the larger the money supply, the higher the inflation rate. Therefore, reducing the money supply would lead to a decline in inflation. He also pointed out that deposits, which had previously been outside the banking system (93% of them), would now come into the system. This currency exchange process would flip the situation, expand the reach of the banks, and enable them to provide financing for the development of the country and its people.

While some protests emerged regarding the daily withdrawal limit of 200,000 pounds, Al-Layli explained that this decision aimed to prevent a focus on cash withdrawals to limit the money supply. He acknowledged that the infrastructure for communications needed to be improved to ensure the widespread adoption of electronic payments. He suggested that, rather than relying solely on smartphones for banking apps, it would be useful to use text messages on basic phones as well.

Al-Layli admitted that any monetary policy would have some groups that are negatively affected, and it would have some shortcomings. However, he indicated that the original policy would be implemented, and later adjustments could be made.

He explained that the amount of counterfeit currency was very small compared to expectations, with only a slight amount of forged 1,000-pound notes detected. He speculated that most of the counterfeit currency would be found in areas under the control of the Rapid Support Forces. He also denied any suspicion of money laundering during the currency exchange process, pointing out that all the security apparatuses were in place to monitor money laundering cases.

The Central Bank of Sudan targeted specific states for the currency exchange, where the old currency was deemed unfit for circulation. Other states required security arrangements before carrying out the exchange. Regarding the presence of currency in regions where residents from states that had completed the exchange were still holding old currency, such as a person from Omdurman visiting Shendi, Al-Layli explained that this issue depended on securing the borders in safe areas. He acknowledged that this was a complex matter, as traders from Omdurman who buy goods in Shendi or Atbara would find it difficult to pay with old currency, as it was not allowed to introduce new currency into Omdurman. He confirmed that this issue required decisions and procedures from the Central Bank of Sudan.

Al-Layli mentioned that Soba was a transfer service between a group of banks not affiliated with the Electronic Services Company, which is an arm of the Central Bank of Sudan. This service had been a platform for transfers before the war but ceased operations during the conflict. He explained that banks had preferred to form closed groups with agreements to facilitate internal transfers. However, he argued that if the service were not managed by the Central Bank of Sudan, it would not function correctly or provide the intended benefits. He confirmed that it was done with the knowledge of the Central Bank, but outside its management, benefiting only clients within the group.

Yasser Al-Tayeb Al-Jumri, the branch manager of the Savings Bank in Shendi, confirmed that the currency exchange had been carried out as planned without any issues. He noted that the turnout and attendance were exceptional and believed that if clients had understood the process from the beginning, the congestion in the final days could have been avoided. He praised the security arrangements that accompanied the exchange process and expressed gratitude to the security committee, led by Colonel Ahmed Farah, for helping secure the movement of money to the Central Bank in Atbara. He also appreciated the efforts of bank employees who worked beyond official hours, as well as the cooperation of the Civil Registry Department. He commended the flexibility shown by the Central Bank of Sudan in the deposit process and the opening of accounts for citizens, which enabled many people to deposit their money.

Al-Jumri criticized the shortcomings of the media campaign in raising awareness among citizens. He pointed out that the process of currency exchange was launched without emphasizing that the goal was economic recovery and bringing the money supply into the banking system, not just a simple exchange. He confirmed that currency exchange was a step toward economic recovery but needed to be followed by strategic plans and a systematic approach. Al-Jumri called for the implementation of strategic policies by the government and the Central Bank to address inflation, counterfeiting, money laundering, and other issues. He urged for a strategic approach to the recovery of the economy after bringing in large amounts of money that were previously outside the banking system.

He revealed that they were surprised by the decision to extend the currency exchange period on December 22 and were once again surprised just before the report was written by another extension of the exchange period.

Al-Jumri acknowledged that they would face challenges regarding the daily withdrawal limit until clients understood the need to deal electronically.

He noted the confusion surrounding currency transactions in the Omdurman area, which, he said, required urgent measures from the state and the Central Bank. He warned that some unscrupulous individuals might take advantage of the situation, leading to buying and selling currency from areas where the exchange had ended to regions where it had not, such as Omdurman.