Methods of Payment

Algerian companies importing more than $40,000 worth of goods per year must pay foreign suppliers by letter of credit, and the Algerian government limits letters of credit to 60 days or less.  It requires Algerian importers of most products to make payment 30 days after the date of shipment of goods, with exceptions for strategic products, food items, or other items of “emergency character.”  Because importers must request import approvals well before the shipment, the requirement to make payment 30 days post-shipment exposes importers to significant exchange rate risk.

U.S. businesspeople should note that Algeria is a cash economy with minimal credit card usage and electronic payments.  Payments for goods require an invoice with bank domiciliation and customs clearance documents.

For more information about payment methods or other trade finance options, please read the Trade Finance Guide available. To access Algeria’s ICS section on financing, visit the U.S. Department of State Investment Climate Statement website.

Banking Systems

Six state-owned banks dominate 90 percent of the commercial market.  Citibank, HSBC, BNP Paribas, Société Générale, as well as other French and Arab banks, are also active in Algeria.  International money transfer services, such as Western Union, also operate in the country.

Barriers to outward transfers and an antiquated domestic transfer system pose challenges for investors.  Though the central bank has created a system to permit payments by check and credit cards, it is still very new, and few vendors have adopted it.  Neither checks nor credit cards are common, and ATMs are installed at very few locations, including five-star hotels.  In late 2010, the Algerian government retroactively banned commercial loans from shareholders abroad made after July 2009.   

Foreign Exchange Controls

The government tightly controls foreign exchange for Algerian firms.  Algerian companies (except those in the hydrocarbons sector) may only receive up to 50 percent of their export earnings in U.S. dollars.  Algerian companies in the hydrocarbons sector must receive 100 percent of export revenue in local currency (dinars).  With few exceptions, the Algerian government prohibits Algerians from holding financial assets abroad.  It does make foreign exchange available to Algerians for importing goods, provided they have the dinar equivalent of the hard currency cost of the imports.  The Algerian dinar is convertible for current accounts for businesses.

U.S. Banks and Local Correspondent Banks

List U.S. banks operating in the market.

Citigroup, N.A. (Citibank)

Immeuble Le Ksar, 34/35 Quartier d’affaires

Bab Ezzouar, Alger 16311

Phone: +(213)-21-547-821

Public banks maintain correspondent banking relationships with several U.S. banks.  Relationships with Banque Extérieure d’Algérie (BEA):

• Bank of New York
• Bank of America
• Bankers Trust
• JP Morgan Chase
• Chemical Bank
• Citibank
• First Chicago

Relationship with Crédit Populaire d’Algérie (CPA):

• Citibank
• Arab American Bank
• Chemical Bank
• Mellon Bank

Relationships   with   Banque   Nationale   d’Algérie (BNA):  

• American Express Bank
• Bank of America
• Bank of New York
• Bankers Trust
• JP Morgan Chase
• Citibank
• CoBank Denver
• First-Interstate Bank of California
• Mellon Bank
• Pittsburgh National Bank
• United Bank for Africa

Relationships with Banque de Development Local (BDL):

• Citibank
• NY Rabobank
• United Bank for Africa