U.S. Embassy urges modern banking uptake in Iraq

Shafaq News/ On Wednesday, the U.S. Embassy in Baghdad said that Iraqis are among the lowest countries in the region in holding a formal bank account.

In a post on its official Facebook account, the U.S. embassy said that as of 2021, less than a quarter of Iraqi adults held a bank account.

"Modern banking services enable greater foreign investment, credit for the Iraqi public, and protection from financial crime, theft, and loss. Informal money transfer services are detrimental to local economies. "the Embassy said.

Quoting the World Bank, the U.S. embassy pointed out that in 2021, only 18.57% of Iraqis above 15 held an account at a financial institution, one of the lowest in the Middle East and North Africa region, which averages roughly 53%.

"Iraq's use of and dependence on cash and informal money transfer services is detrimental to the economy because it reduces the prospects of financial regulation necessary to convince reputable international firms to conduct business in Iraq." The Embassy added.

The Embassy highlights Washington and Baghdad's collaboration over the past two years, explaining that the U.S. government has worked with Iraq to build back trust in the banking sector and reform transfer mechanisms related to imports financed through Iraqi banks.

"The new reforms encourage the proper registration of businesses and increase the use of formal banking channels. According to the Central Bank of Iraq, in the past two years, the total deposits held with Iraqi commercial banks have risen by about 37%, and from 2021 to 2022, the total number of accounts at Iraqi banks has risen 31%. "