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ERBIL, Kurdistan Region - Iraq’s central bank on Wednesday decided to decrease the greenback allocation for adult travelers to $2000 per month, the bank said in a statement, framing the move as a reform measure to ensure foreign currency access to all. The move comes shortly after the United States reportedly resumed dollar shipments to Iraq earlier this month.
The Central Bank of Iraq (CBI) has instructed that “the cash allocation limit for adult travelers be set at $2,000 per month, down from $3,000,” the bank's media office said in a statement. The move is part of efforts to "develop the management of foreign currency sales operations, enhance the efficiency of resource distribution, and align with international banking best practices," the CBI said.
The central bank added that the measures are "purely regulatory" and align with efforts to "address economic changes efficiently and sustainably, and keep pace with global developments in payment systems," specifically by encouraging "the use of electronic payment cards, whether credit or prepaid, as the primary and secure means of covering travel expenses outside Iraq."
"This provides greater flexibility for citizens, promotes the transition toward the digital economy, aligns with modern international banking standards, and supports confidence in the banking sector while serving the country's supreme economic interest," the statement added.
Iraqi travelers traditionally buy US dollars from banks and exchange companies at the CBI's official rate of 132,000 dinars per $100, up to $2,000 a month, versus roughly 3.1 million dinars for $2,000 on the parallel black market.
The CBI’s decision on Wednesday comes weeks after Iraq's newly appointed Prime Minister Ali al-Zaidi in late June replaced the bank’s then-governor Ali al-Alaq with Nazar Nasser Hussein, a career anti-money laundering regulator, and named Alaq economic advisor to the premier.
Amid the transition, dollar sales to travelers at the official rate were suspended - though this was largely seen as tied to the broader US dollar shipment freeze to Iraq in recent months, before sales reportedly resumed earlier this month.
The resumption coincided with a push by Zaidi to disarm Iran-aligned Iraqi armed groups and bring their weapons under state control, along with a more recent anti-corruption crackdown, Operation Dawn, ongoing since late June.
Beyond that, the CBI's latest move aligns with a longer-running effort to phase out dollar cash withdrawals in favor of electronic payments, especially as a senior official from the bank told Reuters in 2023 that travelers had found ways to abuse the previous $3,000 quota system, contributing to dollar shortages and pressure on the parallel exchange market.
