MAURITANIA: Banking Compliance Best Practices Take Center Stage as Economy Gradually Recovers from COVID-19

Mauritania’s economy has long been characterized by informality and a cash-based system, presenting significant challenges for financial institutions operating in the country. However, with the assistance of the International Monetary Fund (IMF), the banking sector has made notable progress in recent years.

Banking Sector Challenges

According to the World Bank, only 21 percent of Mauritanians have bank accounts, making modern payment methods like credit cards concentrated mainly in major urban centers. Despite this, foreigners are free to open individual or business banking accounts without any restrictions.

To comply with regulations, companies must provide proof of a physical address, local registration documents, a copy of a photo ID, and two photos when opening a bank account.

Improving Access to Credit

The IMF has helped Mauritania improve access to domestic credit and reduce interest rates from 30 percent in 2000 to 10 percent in 2018. The country’s five largest banks have combined reserves of US$100 million, although the banking system’s strength cannot be independently verified due to lack of transparency.

Strengthening Compliance

In a bid to streamline compliance with international standards, the Central Bank of Mauritania has implemented reforms and conducts yearly audits of Mauritanian banks as mandated by the Ministry of Finance. Since 2017, the Central Bank has reduced direct foreign currency sales to the private sector to enforce stricter foreign exchange regulations and allow for a more flexible exchange rate determination.

Foreign Exchange Regulations

Foreign investors are guaranteed the free transfer of convertible currencies at the legal market rate, subject to availability. Similarly, foreigners working in Mauritania can expect prompt transfers of their professional salaries after opening a foreign exchange bank account.

• The local currency, the Ouguiya, is freely convertible within Mauritania.
• Hard currencies can be obtained from the Central Bank and commercial banks through regular foreign exchange auctions that allow market forces to fix the value of the Ouguiya.
• However, delays in transferring investment returns can occur if the bank does not have sufficient reserves.

Correspondent Banking Relationships

The absence of U.S. banks operating in Mauritania and correspondent banking relationships with U.S. banks has been a result of de-risking policies applied by American financial institutions. The country’s only international bank, Attijari, maintains a banking relationship with U.S. banks, while Société Générale exited the market in June as part of a global decision to divest assets in the Sahel region.

Additional Information

For more information on Mauritania’s banking system and capital markets, please refer to the Investment Climate Statement.