RIO DE JANEIRO, BRAZIL – The Central Bank of Argentina announced on Thursday that it would start operating next week, together with Paraguay, a system of payments in local currencies for transactions between the two countries.
The Central Bank of Argentina (BCRA) board of directors approved on Thursday the operating regulations to implement the system, together with the Central Bank of Paraguay (BCP), from next Tuesday.
As explained by the Argentine monetary authority in a statement, the system is intended to channel payments corresponding to operations between individuals or legal entities, resident, domiciled, or headquartered in Argentina and Paraguay.
“In this way, Paraguay joins Brazil and Uruguay, countries with which the BCRA has already established payment agreements in local currencies”, highlighted the Argentine Central Bank.
The transactions that may be made through the local currency payment system include, among others, advance payments and receipts of exports and imports of goods and services, retirement payments, and transfers of family allowances.
For example, an Argentine exporter will collect a sale to Paraguay in Argentine pesos that its buyer paid in guaraníes without adding conversion costs to another exchange currency, such as the U.S. dollar.
The central banks of Argentina and Paraguay will publish the conversion rate for the value of transactions daily.