Credit Cards Are Coming Back to Iran

April 28, 2016

IranWire Citizen Journalist

3 min read

Some specialty outlets like carpet stores facilitate credit card purchases

Visa accepted here

Sticker advertising international transaction services

An Iranian citizen journalist, who writes under a pseudonym to protect her identity, wrote the following article on the ground inside Iran.

Because of international sanctions, Iranians have long faced obstacles conducting international transactions. One reason for this has been the unavailability of credit cards. While e-commerce has taken off around the world, Iranians living in Iran have largely been left behind. But now, credit cards are returning to Iran.

This means greater convenience for Iranians and may also help boost tourism. Under sanctions, tourists could not use credit cards to pay for hotels or everyday goods, and more than a few ignorant travelers have turned up without the necessary wads of cash.

Now, some private companies in Iran are handling major credit cards like Visa and MasterCard.

Mr. Nowruzi, an importer who frequently purchases merchandise from abroad, says that before sanctions took effect, some private Iranian banks issued credit cards under very burdensome conditions. One condition was that applicants had to make a long-term collateral deposit of two and a half times the credit amount. These banks also imposed high service charges.

According to a branch manager for the Export Development Bank of Iran, this bank issued credit cards with the cooperation of Royal Bank of Azerbaijan, based on collateral deposits. But after 2012, it stopped issuing cards because of international sanctions.

Now, private companies have started extensive ad campaigns across Tehran offering credit card services and services facilitating online purchases outside Iran.

When I called some of these companies, I found out that acquiring credit cards through them would be much easier than it was to acquire them through private banks.

According to the director of one company, these private companies use branches of Visa and MasterCard in nearby countries like Oman, the United Arab Emirates, Georgia, and Armenia, as well as Eastern European countries like Bulgaria and Poland. To use these companies’ services, applicants must to fill out a form, provide copies of their national ID card and passport, and deposit funds for collateral and service charges.

Direct Shopping, Roundabout Delivery

The same company director says that if a customer purchases an item online from an international e-commerce site that provides shipping to Iran, then the item will be delivered directly to their address, provided it does not violate Iran's laws. But if the seller does not ship directly to Iran, his company can offer the seller use of its branch in Georgia as a transit point.

As I contacted other private companies, and I learned more about how they do business. To receive purchases through a third country, customers must pay them 15 percent of the purchase price plus $40 for each kilogram shipped.

I also learned that in a number of Iranian shopping centers, Visa and MasterCard holders can make purchases using their accounts abroad.

In certain businesses which cater to tourists, such as international hotels and handicraft stores that offer high-priced items like Persian carpets, credit card holders can use the Visa-POS service, an Internet-based system for processing point-of-sale transactions via an account in another country. But according to these businesses, accessing Visa-POS is not easy, and the service remains rare across Iran.

Fereshteh Homayooni, citizen journalist, Isfahan