Egyptian banking and finance work runs on the Central Bank and Banking System Law, Law No. 194 of 2020, which repealed Law No. 88 of 2003 and rewrote the regime for the Central Bank of Egypt, banks, foreign exchange and money transfer companies, credit information and guarantee companies, and payment system operators and payment service providers. The law is detailed in ways that matter to every financing file: it fixes the licensing perimeter and minimum capital, codifies bank secrecy, regulates credit and collateral, and gives the Central Bank graduated tools from corrective measures to resolution. This article sets out the framework we apply when we review banking and finance matters in Egypt, from facility documents and security to licensing and payment models.
The 2020 framework and who it covers
Law No. 194 of 2020 applies, under its first promulgation article, to the Central Bank, the banking system, foreign exchange companies, money transfer companies, credit information and rating companies, credit guarantee companies, payment system operators and payment service providers. The second promulgation article makes the Companies Law No. 159 of 1981 the residual statute for supervised entities, with the Central Bank acting as the competent administrative authority and its Governor as the competent minister for companies under its supervision, and applies the Commercial Law No. 17 of 1999 to dealings between banks and their clients whether or not the client is a merchant.
The seventh promulgation article repealed Law No. 88 of 2003, and the fourth gave supervised entities one year to adjust their status, extendable by the Central Bank Board for up to two further years. In practice, every pre-2020 document reference to the old law is read against the new article numbers, and every compliance file is measured against the 2020 text and the Central Bank's implementing decisions, which the fifth promulgation article tasks the Board with issuing.
The licensing perimeter: banking is a registered activity
Article 63 of Law No. 194 of 2020 draws the perimeter: no natural or legal person may engage in banking activities unless registered under the law, and no unlicensed entity may use the word bank, or any misleading equivalent in any language, in its own name, trade name or publicity where that could mislead the public. Public legal persons act within their incorporation mandates. The same perimeter logic appears again for payments in Article 184, which prohibits unlicensed operation of payment systems or provision of payment services, from inside Egypt or from abroad to Egyptian residents.
The perimeter drives the first question in any review: is the counterparty's activity licensed, and is the license the right one. A finance model that takes deposits, grants credit and moves funds can fall inside banking; a model that operates payment rails or provides payment services falls inside the payments chapter. Mischaracterization is not a drafting risk but a licensing breach, so the classification is resolved from the law's definitions before documents are negotiated.
Bank licensing: conditions, capital and process
Article 64 sets the conditions for a banking license: incorporation as an Egyptian joint stock company or as a branch of a foreign bank, a minimum issued and paid-up capital of five billion Egyptian pounds, or, for foreign branches, one hundred fifty million US dollars or equivalent in freely convertible currency, a transparent ownership structure identifying ultimate beneficial owners and lawful sources of funds, compatibility with the public economic interest and competition, a viable business plan, and sound governance, risk and internal control frameworks. The Board may make exceptions to the capital threshold for specialized banks or digital banks. Foreign applicants must show a home supervisor that supports consolidated supervision and consents to joint supervision arrangements.
The process is staged. Under Article 65, the applicant seeks preliminary approval with a non-refundable fee of one million Egyptian pounds, and the Board decides within ninety days of a complete application; establishment must be completed within one year or the approval lapses, extendable once. Under Article 66, the license itself is granted by the Board on the Governor's recommendation track, with the Governor approving the initial board of directors under Article 120. For foreign branches, Article 67 sets a fifty-thousand-dollar application fee and a six-month establishment deadline, and Article 68 requires an unconditional head-office guarantee covering all deposits, creditor rights and branch liabilities.
Ownership, control and disclosure inside banks
Ownership transparency runs through the law. Article 64 makes identification of ultimate beneficial owners a licensing condition. Article 82 requires banks to maintain and update a register of holders owning more than five percent or exercising de facto control, and to notify the Central Bank of all changes. Amendments to a bank's incorporation contract or articles of association, and changes to data submitted at licensing, require prior notification and preliminary Central Bank approval under Article 92 before the general assembly may act, with registration in the Central Bank's special registry to complete.
For financing and acquisition work, these rules translate into conditions and representations. A stake-building plan in a bank's shares is mapped against the five percent register and notification duties; a facility to a bank borrower treats Article 92 approvals as conditions where the transaction touches the borrower's statutes; and beneficial ownership disclosure is collected at term-sheet stage because the Central Bank will ask for it.
Prudential supervision: fees, plans, outsourcing and concentration
The Central Bank funds its supervision through an annual oversight fee under Article 93, capped at two pounds per ten thousand pounds of the bank's average monthly consolidated position for the preceding year, payable each January. Article 94 requires every bank to maintain a contingency plan for systemic or bank-specific shocks, approved by its board and updated at least every two years or on material change. Article 95 obliges the Central Bank to prepare resolution plans for distressed banks, and banks must remove obstacles to execution and answer data requests on holding companies, affiliates and principal shareholders.
Operational discipline is regulated too. Article 96 prohibits banks from engaging unregistered providers for important outsourced services and technology, while leaving the bank fully responsible for the outsourced function. Article 97 requires prior Board approval for mergers, demergers and restructurings, with license cancellations and registry removals published in the official gazette within ten days. Article 98 caps concentration: exposure to a single borrower or related party may not, in necessary cases set by the Board, exceed thirty percent of the bank's capital base.
Credit rules that shape the facility file
Chapter Four of the law regulates credit itself. Article 99 requires each bank to maintain credit policies covering creditworthiness assessment, verification of client information, approval and monitoring, with lending powers resting with management, not the board. Article 100 obliges credit applicants to disclose their ownership structure, related parties, shareholding and outstanding debts with other institutions, and obliges the bank to verify before considering the application. Article 101 restricts credit to clients of good reputation with resources and projected cash flows sufficient to meet obligations, and prohibits renewing or modifying credit before the client confirms existing balances.
Collateral has its own machinery. Article 102 requires a register of tangible collateral, verification of ownership documents and appraised value, and periodic revaluation overseen by the bank's Risk Committee, subject to Central Bank inspection. Article 103 puts collateral valuers on a Central Bank registry with liability for their reports. Article 104 obliges banks to ensure credit is used only for approved purposes. Article 105 requires quarterly account statements, with the client deemed to accept the balance if it does not dispute within thirty days, a default rule that regularly decides evidence disputes later.
Security enforcement: commercial mortgage and pledged securities
Law No. 194 of 2020 shortened enforcement routes that matter in term sheets. Under Article 106, a registered commercial mortgage over retail or commercial premises securing financing constitutes an enforceable executive document under Article 280 of the Civil and Commercial Procedure Law, and the Central Bank may license banks to accept such mortgages; foreign banks and international finance institutions may accept the pledges in Egypt. Under Article 107, where the bank as pledgee has a contractual right to sell pledged securities on default, it may sell in accordance with trading rules after ten business days' written demand through bailiff documents, without the Commercial Code's judicial sale formalities.
The review consequence is drafting discipline. The executive-document route depends on registration of the mortgage; the self-help sale route depends on the contractual right being present and the demand being served correctly. A security schedule records the asset, the register, the valuation date and the perfection step, and the enforcement clause is checked against these articles before anyone prices the enforcement timeline.
Banking secrecy and its exceptions
Article 140 codifies secrecy: all customer data, accounts, deposits, safe-kept valuables and transactions are strictly confidential and may not be disclosed without the client's written consent or a judicial or arbitral order, and the duty binds all persons and authorities and survives the end of the banking relationship. Article 142 extends the prohibition to every individual who holds information by position or authority, even after leaving office. Article 143 preserves the duties of bank auditors and the powers of the Central Bank.
The disclosure route is narrow and procedural. Under Article 141, in a serious criminal investigation the Public Prosecutor or a delegated senior prosecutor may ask the Cairo Court of Appeal to authorize disclosure, with affected parties notified within three days, and the same route covers money laundering, terrorism financing and certain military affairs cases. For financing files, the consequence is operational: information sharing with lenders, arrangers and assignees runs on client consent language drafted into the documents, not on assumptions.
Corrective measures, early intervention and resolution
The law gives the Central Bank a graduated ladder. Article 144 authorizes sanctions for violations, and Article 146 defines the trigger cases for early intervention, including failure to comply with corrective actions. Article 147 lists the Board's early intervention measures: strengthening governance, risk management, internal controls and accounting policies, additional regulatory requirements, restoration of liquidity ratios, additional provisions or capital, restrictions on distributions and benefits, and implementation of the Article 94 contingency plan. Articles 153 onward establish the resolution regime for distressed banks, building on the Article 95 resolution plan, with creditor priority set by Article 175.
For counterparties, the ladder changes contract practice. Depositors, lenders and trading partners of a bank read events of default against the regulator's powers: a bank under early intervention may be barred from distributions while still performing on its debts, and resolution powers can transfer assets and liabilities. Interbank and syndicated documents therefore treat regulatory action as its own event category rather than folding it into insolvency language.
Payment systems and payment services
The payments chapter is a licensing regime of its own. Article 184 prohibits operating payment systems or providing payment services without a license, whether from inside Egypt or from abroad to residents, and bars unlicensed use of the titles payment system operator or payment service provider; exchanges, settlement systems, central depositories, custodians and certain Ministry of Finance internal systems are carved out. Article 185 tasks the Board with the licensing conditions, including minimum capital, legal form, technical competence, ownership disclosure and fees capped at five hundred thousand pounds for a payment system operator license application and one hundred thousand pounds for a payment service provider, with decisions within ninety days, extendable once.
Licensed operators and providers are entered in a special Central Bank register, with examination fees capped at five hundred thousand pounds for operators and two hundred thousand pounds for providers. Article 186 authorizes Board rules on oversight, including interoperability, access, technical standards and protection of users' funds and data. For a fintech or a merchant, the analysis is the same as for banking: classify the activity, confirm the license and register entry, then read the contract against the oversight rules.
Currency, reserves and foreign exchange
The monetary chapter anchors the rest. Article 60 gives Central Bank currency unlimited legal tender power, Article 61 requires currency in circulation to be backed in full by reserves of gold, foreign currencies, foreign securities and government debt instruments, and Article 62 locates those reserves in the Central Bank's vaults or with approved banks at home and abroad. Foreign exchange and money transfer companies are brought inside the law by its first promulgation article, and the statute-amendment approval of Article 92 is expressly applied to licensed exchange companies.
For cross-border financings, the practical reading is that currency backing, exchange company licensing and bank status are all Central Bank questions. A facility in foreign currency, a remittance model or an exchange business is checked against the same regulator's registers and decisions, and the payment and transfer legs of a transaction are mapped to the licensed category before signing.
What we review in an Egyptian banking and finance matter
When we review an Egyptian banking or financing matter, we start with the perimeter under Articles 63 and 184 and the licensing file under Articles 64 to 68, including capital, beneficial ownership and, for branches, the head-office guarantee. We test ownership and statute changes against Articles 82 and 92, read credit and collateral terms against Articles 99 to 105, and check enforcement routes against Articles 106 and 107. We map secrecy consents under Articles 140 to 142, assess the bank counterparty against the corrective and resolution tools of Articles 144 to 147 and the creditor priority of Article 175, and classify any payment activity under Articles 184 to 186. The output is a file that shows what is licensed, what is perfected, and what each remedy is worth.
See also: our guide to Investment Law 72 of 2017 incentives and our Egypt company formation guide, plus our commercial and corporate practice.
Frequently asked questions
What is the main banking law in Egypt?
The Central Bank and Banking System Law, Law No. 194 of 2020, which repealed Law No. 88 of 2003 and covers the Central Bank, banks, foreign exchange and money transfer companies, credit information and guarantee companies, and payment system operators and service providers.
What is the minimum capital for a bank in Egypt?
Five billion Egyptian pounds in issued and paid-up capital under Article 64, or one hundred fifty million US dollars or equivalent for a branch of a foreign bank, with possible exceptions for specialized and digital banks.
Can a foreign bank open a branch in Egypt?
Yes, through the licensing process of Articles 64 to 68: preliminary approval with a fifty-thousand-dollar fee under Article 67, establishment within six months, and an unconditional head-office guarantee covering deposits, creditor rights and branch liabilities under Article 68.
Is banking secrecy statutory in Egypt?
Yes. Article 140 makes customer accounts, deposits and transactions strictly confidential, disclosable only with written client consent or judicial or arbitral order, and Article 141 provides a criminal-investigation route through the Public Prosecutor and the Cairo Court of Appeal with notice to affected parties within three days.
Who regulates payment companies in Egypt?
The Central Bank of Egypt, under Articles 184 to 186 of Law No. 194 of 2020: operating payment systems or providing payment services without a license is prohibited, licensed entities are entered in a special register, and the Board sets licensing and oversight rules.
Can a bank sell pledged shares without going to court?
Yes, if the contract gives it that right: Article 107 allows the pledgee bank to sell pledged securities in accordance with trading rules after ten business days' written demand through bailiff documents.
What happens if a client ignores account statements?
Under Article 105, banks send statements at least quarterly, and a client who does not dispute the balance within thirty days is deemed to accept it unless it proves otherwise.
Do you review financing documents before signing?
Yes. Our Cairo office reviews facility packages, security and enforcement routes, licensing status and payment models against Law No. 194 of 2020 and Central Bank decisions. Contact us through our contact page to discuss your financing.