New Central Bank Regulations Force Many Exchange Shops To Close In Kuwait

02/04/2025

KUWAIT CITY, April 2: A large number of money exchange shops closed following the enforcement of regulations governing exchange companies and institutions, in line with the Central Bank of Kuwait’s requirements, especially after the deadline for license holders to comply expired, reports Al-Seyassah daily. In response, the Ministry of Commerce and Industry, led by Minister Khalifa Al-Ajeel, quickly conducted inspection tours with three teams targeting exchange shops throughout Kuwait. Out of 138 shops that failed to comply with the decision, only one was closed, while the others chose to remain inactive. On June 11, 2024, the Council of Ministers issued Resolution No. 552/2024 for transferring the responsibility for supervising and monitoring exchange shops from the Ministry of Commerce and Industry to the Central Bank of Kuwait. This decision was implemented through Ministerial Resolution No. 233/2024, which regulates the work of exchange businesses in line with the requirements set by the Central Bank of Kuwait.

The resolution granted license holders a specific period to comply with these requirements, which expired on March 31. In this regard, Director of the Technical Authority for Supervision of Commodities and Pricing and Acting Director of Consumer Protection at the Ministry of Commerce and Industry Faisal Al-Ansari stated that exchange businesses complied with the law by closing their shops to adhere to the instructions mentioned in the ministerial resolution. He said the ministry’s inspection teams were deployed in all areas, based on the instructions of Minister Al-Ajeel, to ensure compliance with the guidelines issued by the Anti-Money Laundering Department.

Al-Ansari revealed that one shop was closed in Fahaheel out of 138 establishments. He praised the shop owners who adhered to the instructions and refrained from resuming operations until their businesses were converted into companies. Al-Ansari affirmed the Commercial Supervision Department’s commitment to enforcing the law and urged exchange businesses to contact the Central Bank of Kuwait to rectify their status. He highlighted the keenness of the Ministry of Commerce and Industry to meet the requirements of the Financial Action Task Force (FATF) in Kuwait’s assessment of anti-money laundering and counter-terrorism financing, as it is one of the regulatory bodies responsible for enforcing the AML/CFT law, adding that this assessment is important for the country’s future economic outlook.

Meanwhile, banking sector sources believe that the requirement for exchange businesses to convert into companies with a capital of KD 2 million is a major challenge for many, and will potentially force them to exit the market and leave it to be dominated by a few companies. They stressed that most of these institutions already comply with the necessary procedures outlined by the Central Bank of Kuwait for companies under its supervision, including using the customer’s civil ID when collecting amounts over KD 3,000 and using KNet for transactions. In addition, the Ministry of Commerce and Industry affirmed that it will continue to suspend and prohibit commercial activities for companies and institutions that fail to comply with the new regulations. The ministry said exchange offices must submit an application to establish an exchange company with a fully paid capital of no less than KD 2 million. Currently, the number of exchange offices operating in the local market under the supervision of the ministry is limited to 138 companies and institutions.