CAIRO: Egypt signed a protocol with Visa Inc. Wednesday to propose a program to transform the subsidies structure into an open payment system, according to a Wednesday statement by the Supply Ministry.
The ministry aims for Egyptian banks to participate in the new system to provide several options for beneficiaries in a “modern, transparent fashion,” Supply Minister Khaled Hanafy stated.
The protocol was signed by the head of the Global Financial Inclusion at Visa Stephen Kehoe, Hanafy and Planning Minister Ashraf al-Arabi.
The subsidies’ budget amounts to 40 billion EGP ($5.11 billion) a year, Hanafy said, adding that the protocol targets an additional benefit of 20-30 percent by using smart ration cards as a guarantee to buy home appliances and when taking loans.
Visa Inc. will be a voluntary partner that would not require payment from the government, according to Hanafy. He praised the Planning Ministry for offering technical assistance in terms of the mechanism of the smart ration cards; a new system that kicked off in 2014.
Egypt has provided its citizens with subsidies for oil and basic commodities, including bread, since the 1950s.