Regulatory Alerts2024-10-01
Circular No. 01/RC/22 on the Exchange Margin to be Applied by Banks in Foreign Exchange Transactions with Customers
The Banque de la République du Burundi issued Circular No. 01/RC/22 to mandate that banks apply a foreign exchange margin of ±2.0% (capping at ±5.0% including fees and commissions) when setting buying and selling rates for customer transactions, based on the BRB's published average rate. Banks must chronologically record and make available key transaction data, including beneficiaries, amounts, dates, applied rates with specified margins, and applicable fees. The circular also establishes a consumer protection complaint mechanism under Regulation No. 001/2019, mandates the display of rates and fees, repeals conflicting prior provisions, and takes effect upon publication in the Official Gazette and on the BRB website.
BANQUE DE LA REPUBLIQUE DU BURUNDI LE GOUVERNEUR
CIRCULAIRE N° 01 /RC/22 RELATIVE A LA MARGE A APPLIQUER PAR LES BANQUES DANS LEURS OPERATIONS DE CHANGE AVEC LA CLIENTELE
Article 1 : Objet et champ d’application
The present circular aims to specify the exchange margin to be applied by banks in their foreign exchange transactions with customers, in accordance with Article 6 of the Foreign Exchange Regulations dated September 17, 2019.
Article 2 : Référence de fixation des cours et marges de change
Every bank must refer to the average rate published by the Banque de la République du Burundi (BRB) to set its buying and selling rates.
The applicable exchange margins for foreign currency sales and purchases must be within plus or minus two percent (± 2.0%) of the official reference rate published by the BRB, without exceeding plus or minus five percent (± 5.0%) including all fees and commissions related to these operations.
In case of violation, the bank is required to refund any overcharge, without prejudice to sanctions provided by current regulations.
Furthermore, the buying and selling rates as well as the fees and commissions applied to customer-facing operations must be displayed in accordance with the Foreign Exchange Regulations and Regulation No. 001/2019 on the Protection of Consumers of Financial Products and Services.
Article 3 : Informations à disposer à tout moment
The bank is required to make available at all times, in a chronological manner and in files or registers designed for this purpose, information regarding: a. Amounts received via the MID (Monetary Information System) or outside the MID, their status of use, and beneficiaries;
b. Validation of export declarations; c. Export revenues collected and their use; d. Foreign currency purchase and sale operations conducted for its customers.
These information must include, among others: a. The beneficiary; b. The date of the operation; c. Amounts; d. The reference exchange rate; e. The applied exchange rate, specifying the margin; f. Fees and commissions applied, where applicable.
Article 4 : Gestion des plaintes liées au change
In the event of a foreign exchange operation resulting in a disputed situation, recourse is filed by the aggrieved party in accordance with Regulation No. 001/2019 on the Protection of Consumers of Financial Products and Services.
Article 5 : Disposition abrogatoire
All prior provisions contrary to this circular are hereby repealed.
Article 6: Entrée en vigueur
This circular enters into force on the day of its publication in the Official Gazette of Burundi and on the Website of the Banque de la République du Burundi.
Made in Bujumbura, on December 10, 2022
MURENGERANTWARI Dieudonné
Governor
1 Avenue du Gouvernement- B. P. 705 BUJUMBURA Tel: (257) 22 20 40 00 /22 22 27 44 - Fax: (257) 22 22 31 28 – Email: brb@brb.bi