Electronic payment... a gateway to exit the gray list

Source: Nida Al Watan – Patricia Jallad

The Financial Gap Law has overshadowed the measures Lebanon is adopting to strengthen the compliance environment within the financial sector, particularly with regard to combating money laundering. However, Circular No. 750 recently issued by Banque du Liban and addressed to banks and financial institutions, along with Circular No. 1 concerning electronic payment service providers, have refocused attention on the need to regulate payment methods and adopt precautionary measures aimed at reducing cash circulation, thereby narrowing the scope for money laundering and improving Lebanon’s chances of exiting the grey list.

Banque du Liban is reasserting the rules set out in the Code of Money and Credit regarding the central bank’s authority to impose controls and undertake preventive intervention to protect the currency in terms of liquidity, circulation, and withdrawals, as stipulated in Articles 70 and 174 of the Code of Money and Credit, but through the gateway of electronic payment methods.

Circular No. 750

Circular No. 750, addressed to banks and financial institutions and incorporating Decision No. 13791, amends the decision issued by Banque du Liban in March 2000 concerning financial and banking operations conducted by electronic means. This amendment comes after 25 years for several reasons, as economic expert Nassib Ghobril explained to Nidaa Al Watan: to keep pace with expanding technological developments globally and in Lebanon, to strengthen oversight over the past 5 years, and to regulate financial and banking operations carried out electronically.

The circular defines electronic means as technical tools used to execute financial and banking operations electronically, such as payments or money transfers, electronic Know Your Customer (E-KYC) procedures related to electronic service providers, electronic lending, the buying and selling of financial instruments (shares, bonds, investment funds, etc.), issuing electronic bank payment cards, electronic payment gateways and electronic money services; meaning electronic payment service providers. All these operations require prior authorization from Banque du Liban in order to protect customers and data and to limit dealings in unlicensed virtual assets.

Decision No. 13790

Circular No. 1, which incorporates Decision No. 13790 concerning electronic payment service providers, issued on 9 January 2026 as a complement to the decision directed at banks and financial institutions, requires any institution wishing to provide electronic services to obtain prior approval to offer one or more of the following categories of services:

Electronic money service (E-money) – Category A: digital financial services that allow funds to be stored, transferred and paid electronically without the need to carry cash or use a traditional bank account.

Electronic money consists of electronic wallets (E-wallets) through which online purchases can be paid, balances stored, and peer-to-peer (P2P) transfers conducted, enabling sending and receiving money locally and sometimes internationally.

Electricity, water and telecommunications bills can also be paid electronically, as well as purchases in stores or online using QR codes or NFC.

Electronic services

Prepaid cards and cards linked to electronic wallets can also be used as substitutes for bank accounts, as well as for receiving salaries and aid, reducing reliance on cash. These services are provided through banks and money transfer companies and include:

Domestic money transfer service – Category B: enables fast transfers within the same country between individuals or institutions, without necessarily passing through the traditional banking system. Major domestic transfer services operate through companies such as OMT, Western Union, Wish and Bob Finance, which can be conducted via phone or prepaid cards.

Cross-border money transfer service – Category C: funds are sent from one country to another, often in foreign currency, to a beneficiary residing outside the sending country. These services are primarily carried out by banks, international money transfer companies such as Western Union and MoneyGram, and financial technology (FinTech) firms through digital applications. They are used for expatriate remittances, foreign tuition payments, medical expenses, commercial payments and imports, and require compliance with anti-money laundering and counter-terrorism financing laws.

Collection and disbursement service – Category D: financial services that allow the collection of funds from individuals or institutions and their payment to designated entities, in cash or electronically, on behalf of other parties. This includes collecting amounts owed by users and paying them to official or private entities, collecting utility bills, internet, school and university tuition, insurance premiums, subscriptions, municipal fees, fines, official transaction fees and paying salaries and wages through money transfer companies, banks, electronic wallets and approved cash points.

Payment facilitation service – Category E: a financial service enabling individuals and businesses to carry out payments and collections electronically in an easy and secure manner without direct cash handling, via approved digital platforms or applications. It includes collecting payments from customers and executing transactions through bank cards, electronic wallets and digital transfers, thereby reducing reliance on cash.

Strict standards for companies

Circular No. 750 regulates financial and banking operations conducted electronically and sets limits, while Circular No. 1 regulates electronic services, defines categories, and complements the first circular.

According to Ghobril, the conditions contained in both circulars ensure that companies providing these services are solid, serious, transparent, compliant with strict standards and sufficiently capitalized to remain in the market. They define how branches may be opened and on what basis multiple offices may operate. This fosters customer trust in the companies’ long-term continuity and reassures clients that these firms are not fictitious entities aimed at exploiting people and disappearing after collecting funds.

For example, financial institutions registered with Banque du Liban (excluding banks) wishing to provide E-money services must obtain prior licensing from Banque du Liban and comply with Category A conditions under Basic Decision No. 13790 dated 9 January 2026.

Circular No. 1 sets minimum capital requirements according to the above categories at approximately $559,000 for Categories A, B, C and D (equivalent to LBP50 billion) and about $279,000 for Category E. Fifteen percent of the capital must be frozen (about $83,000 or $42,000 depending on category) and returned to the institution upon liquidation as a precautionary safeguard to ensure the company has the required operational capacity to provide payment services.

Thus, these circulars are not merely technical regulatory procedures but constitute a practical pillar for rebuilding confidence in Lebanon’s financial system and repositioning it within the international compliance framework.

Trust and compliance

The financial and banking services regulated by these two circulars represent a necessary and positive step under the strict standards they establish. They form a practical pathway to restoring confidence in Lebanon’s financial system and reintegrating it into the international framework for compliance with anti-money laundering and counter-terrorism financing standards. According to Ghobril, this will help Lebanon persuade the Financial Action Task Force to remove it from the grey list. Entities that fail to comply with the imposed conditions and designated categories will be placed on a list of non-compliant institutions.