The Trade Bank of Iraq (TBI), which has been praised for its efforts providing letter of credit (L/C) finance for Iraqi transactions, is to lead the way into other banking segments by expanding its range of services.

Iraqis will soon, for the first time, be able to pay for purchases with plastic cards and withdraw cash from automatic teller machines (ATMs).

Significant achievement

The debit and cash cards, on the verge of being issued by TBI, will mark a step forward for the banking sector and their introduction is a very significant achievement in an economy yet to recover from several wars, 13 years of sanctions and decades of dictatorship.

President of TBI, Hussein Uzri, said 10 ATM machines will be "immediately" deployed in Baghdad. The bank has also agreed with Visa International Service Association to start issuing debit cards.

EIU praise

The Economist Intelligence Unit (EIU) recently praised the performance of TBI, which started operations in November 2003 and soon obtained guarantees for short-term credit worth US$2.4 billion from 17 export-credit agencies.

The J P Morgan led consortium that runs TBI issued around 1,500 L/Cs in euros and US dollars totalling around US$4.7 billion in a little longer than its first full year in business according to TBI figures.

Other banks

Banks that have expressed interest in Iraq's banking sector include HSBC and Standard Chartered of Britain. They have been granted licenses to open branches in Iraq.

The Export & Finance Bank, a Jordanian investment bank, and the National Bank of Kuwait are hoping to help finance Iraq's reconstruction.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.