Key Points
- New banknotes aim to cut RSF looted funds.
- Critics say millions are excluded from the financial system.
- Limited withdrawals worsen economic hardship for Sudanese citizens.
Sudan’s adoption of new banknotes and a policy mandating individuals to create bank accounts has raised bank deposits and bolstered the army’s combat effort, Finance Minister Jibril Ibrahim said. Critics counter that millions have been shut out of the banking system as a result of the change.
New banknotes drive funds into the formal banking sector
For almost two years, the army has been engaged in combat with the paramilitary Rapid Support Forces (RSF), a battle that has severely damaged Sudan’s economy. Half of the population is now hungry, and the value of the Sudanese pound has dropped by three-quarters.
In contrast to earlier currency exchanges, in order to obtain the new 500-pound ($0.20) and 1,000-pound ($0.50) notes, residents must deposit their old banknotes into accounts. Limiting daily withdrawals has encouraged money to enter the official banking industry in a nation where a large portion of the population lacks access to banking services.
Ibrahim claimed that the effort to make RSF-looted funds useless, which was started in December, had been successful. He did not, however, reveal how much Sudanese money was deposited in total.
In an interview with Reuters, Ibrahim stated, “This helps the banking sector, and when you help the banking sector, that helps the state to finance projects, including the war effort and productive activities.”
Army cites success in reducing looted gold and boosting funds
Since the start of the conflict, RSF soldiers have looted banks and interfered with farming, making it difficult for the army-aligned government to import necessary supplies like medicine and pay salaries.
According to Reuters, Sudan officially exported around half of its 64 metric tons of gold mined last year. According to him, there is less gold that has been looted in areas under army control.
The new currency was created in Russia, one of several foreign nations involved in the fight, according to a source at Sudan’s central bank.
Millions of individuals have been left out, according to critics, especially those living in RSF-controlled areas, making their savings useless and widening the nation’s divide. The RSF has declared the currency transaction to be unlawful and used it as justification for setting up a parallel administration within its borders.
Residents describe utilizing U.S. money, electronic transfers, outdated notes, and occasionally Chadian rials in regions under RSF control.
Some citizens have even objected to the new banknotes in Port Sudan, the army’s capital during the conflict.
Since many people lack the identifying documents required to open accounts and others lack cellphones for online transactions, traders claim that the limitations have negatively impacted commerce.
