Exclusive: Central Bank circulates mechanism and controls for selling personal foreign currency allocations in cash to citizens

Our source has obtained a copy of a circular issued by the Central Bank outlining the mechanism and controls for selling personal foreign currency allocations in cash to citizens through the personal allocation system. The circular was addressed to general managers of banks and chairpersons of licensed exchange companies. It allows for a profit margin of 1%, distributed as 0.5% for exchange companies and offices and 0.5% for banks, in accordance with the following controls:

1. Citizens are permitted to obtain their personal allocations in cash and receive them through commercial banks.
2. The Central Bank of Libya will supply banks with their foreign currency cash needs based on the amounts purchased by citizens through the personal allocation system via exchange companies and offices.
3. Banks are responsible for securing the receipt of foreign currency from the Central Bank, according to serial numbers, and transferring it to their main vaults and branches.

According to additional controls:
4. Banks must enable citizens who hold current accounts with them to withdraw their allocations in foreign currency cash through designated branch networks agreed upon with the Central Bank, ensuring organized distribution based on lists provided by the Central Bank.
5. Banks bear responsibility for transporting foreign currency from the Central Bank to their headquarters and branches, in line with the Central Bank’s procedures and controls, while applying security and safety standards.
6. Exchange companies and offices must follow procedures outlined in Circular No. (2) of 2026 and comply with Circular No. (4) of 2026 regarding anti-money laundering and counter-terrorism financing controls.
7. Banks are allowed to add a commission (profit margin) to the official exchange rate announced by the Central Bank within a limit of 1%, as per the Board’s decision. This is divided equally between banks (0.5%) and the exchange companies/offices through which the booking process was conducted, with strict prohibition on imposing any additional fees on customers.

Further controls include:
8. Banks must document each cash withdrawal transaction using the serial numbers of the currency delivered to the customer, retain transaction data, and record it in the designated system.
9. Bank clients are entitled to verify that the serial numbers of the received currency match those stated on the receipt issued by the bank.
10. Banks must verify customer identities in person before executing any transaction and apply due diligence measures proportionate to the nature, size, and associated risks, in line with Central Bank instructions.
11. Banks must document each withdrawal process by:

• Entering required data into the foreign currency sales platform, including serial numbers of delivered banknotes, customer details, transaction details, and timing.
• Retaining a signed cash receipt form from the customer, along with a copy of their identification and the delivery receipt.
• Ensuring that Know Your Customer (KYC) data is up to date both physically and within the bank’s system.
• Documenting due diligence procedures and results in compliance with Central Bank regulations on compliance, anti-money laundering, and counter-terrorism financing.

The Central Bank called for strict adherence to these instructions and their implementation, noting that it will conduct monitoring and inspection processes across all banks and their branches to ensure proper application, as well as the accuracy and integrity of submitted data and reports.