Financial Crime World

Financial Compliance in Chad: A Comprehensive Overview

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Introduction

In a country where cash transactions dominate, navigating financial compliance can be daunting. Chad’s banking system is limited, with commercial banks offering short-term and long-term financing options. However, the process of transferring funds both within and out of the country requires adherence to strict regulations.

Restrictions on Capital Outflows

The Central Bank of Chad regulates foreign exchange operations and enforces a 16-25% interest rate for short-term loans. Individuals transferring more than $1,000 must provide documentation detailing the source and purpose of the transfer. Companies exceeding $50,000 in transactions are automatically notified to the Central Bank.

Implications for Businesses

  • Holding large sums of foreign currency can be a risk, as the government may seize funds through legal procedures.
  • Adhering to strict regulations is crucial to avoid fines or penalties.

Correspondent Banks

Several local banks have arrangements with correspondent banks in the US and Europe, facilitating international transfers. These banks include:

Notable Local Institutions

  • Société Générale des Banques (formerly BTCD): Arrangements with Société Générale of New York; Standard Chartered Bank of New York; the Bank of New York.
  • Banque Commerciale du Chari: Arrangements with Arab Intercontinental Bank, Paris; Union des Banques Arabes et Françaises, Paris.
  • Ecobank Tchad: Arrangements with NATXIS, Paris; Citibank, New York.

Additional Correspondent Banks

  • Orabank (formerly Financial Bank Tchad): Arrangements with NATXIS, Paris; Credit Agricole, Paris; ING, Belgium, UBS, Barclays London, Bank of Montreal.
  • Commercial Bank Tchad, formerly Banque de Développement du Tchad (BDT): Arrangements with Citibank, New York; the United Bank for Africa (UBA).
  • Banque Agricole et Commerciale: Arrangements with Citibank, New York; the United Bank for Africa (UBA).
  • Banque Sahelo Saharienne pour L’investissement et le Commerce (Tchad) S.A.: Arrangements with ING Belgium SA; Commerzbank, Germany; BNP Paribas, Switzerland; British Arab Commercial Bank Ltd.
  • United Bank for Africa (UBA) Tchad: Arrangements with NATXIS, Paris; United Bank for Africa (UBA), New York, London and Paris.

Exchange Rates

The Central African Monetary Union (CEMAC) guarantees the convertibility of the Central African CFA Franc (FCFA) into Euros at a fixed rate. Exchange rates may fluctuate based on the strength of the US dollar versus the Euro. In 2019, the average exchange rate was 592.73 FCFA per USD.

Conclusion

For more information about financial compliance in Chad or trade finance options, refer to the Trade Finance Guide available at Export.gov/TradeFinanceGuide.