Central Bank of Egypt Announces Key Decisions

The Central Bank of Egypt has made some significant announcements recently. The bank has decided to keep its key interest rate unchanged, which is a crucial decision for the country's economy.

This decision was made in order to maintain economic stability and support the country's growth. The bank's governor has stated that the current economic conditions do not require a change in the interest rate.

The Central Bank of Egypt has also announced a new policy to encourage banks to lend to small and medium-sized enterprises. This move is aimed at promoting entrepreneurship and economic growth in the country.

The Central Bank of Egypt has made some notable decisions recently. The bank kept its overnight interest rates steady, with the lending rate remaining at 28.25% and the deposit rate at 27.25%.

The bank's decision to keep rates steady was expected, as inflation is projected to ease substantially in 2025. Inflation dipped to 25.5% in November, its lowest since December 2022.

The Central Bank of Egypt is also supporting digital transformation by extending the exemption of customers from all expenses and commissions related to bank transfer services for individuals. This exemption is effective from January 1, for a period of three months, renewable.

The bank's efforts to encourage citizens to use digital financial services have been successful, with the National Instant Payments System seeing a significant increase in transactions. The system saw nearly 1.5 billion transactions worth up to LE2.9 trillion during 2024.

The Central Bank of Egypt (CBE) has extended the exemption of fees and commissions for bank transfers made via electronic channels, including internet banking and mobile banking apps in Egyptian pounds.

This exemption applies to all transfers executed through the national Instant Payment Network (IPN) and the InstaPay application.

The CBE's decision is effective from January 1, 2025, and will remain in place for an initial period of three months.

The extension is part of the CBE's ongoing efforts to encourage greater adoption of digital financial services, highlighting their convenience and the wide range of benefits they offer.

The national Instant Payment Network (IPN) has seen remarkable growth, with nearly 1.5 billion transactions valued at approximately EGP 2.9trn in 2024.

The InstaPay application has gained significant traction, with over 12.5 million users registered.

The CBE is studying the application of fees on transfers and transactions made through the InstaPay application during 2025.

The value of these fees has not yet been determined, but will most likely be simple and symbolic fees.

Banking expert Tarek Metwally explained that the Central Bank's decision to postpone the collection of fees on transactions came after conducting data analysis and extracting information that showed an increase in the number and values of transactions conducted through the national system for instant payments.

This reflects the need to increase the daily and monthly limits for transactions conducted through the InstaPay application, with the aim of attracting and accommodating various segments of society to enhance digital transformation.

Egypt's central bank kept its overnight interest rates unchanged, as expected, with the lending rate at 28.25% and the deposit rate at 27.25%.

This decision was made by the bank's monetary policy committee, which also kept rates steady in line with a unanimous forecast by 12 analysts polled by Reuters.

Inflation in Egypt dipped to 25.5% in November, its lowest since December 2022, and has been trending downwards from a record high of 38.0% in September 2023.

The committee projects that inflation will ease substantially in 2025, with a notable decline in Q1 2025 and convergence to single digits by H2 2026.

The current policy rates are seen as appropriate to maintain a tight monetary stance until a significant and sustained decline in inflation is achieved, and expectations are firmly anchored.