Tuesday,24 October, 2017
Current issue | Issue 1314, (6 - 12 October 2016)
Tuesday,24 October, 2017
Issue 1314, (6 - 12 October 2016)

Ahram Weekly

Spare some change

Safiya Mounir reports on a new campaign to collect the small change from banking transactions

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Al-Ahram Weekly

President Abdel-Fattah Al-Sisi asked Egyptians last week to donate the small change from their banking transactions in order that it could be used to help revive the economy.

His message was that if people donated the few piastres that come after the decimal point in banking transactions this could make a difference to funding projects such as the Bashayer Al-Kheir Development Project for informal housing areas and other social welfare projects.

“This idea is practiced around the world, from the richest countries to the poorest,” said MP Passant Fahmi, a veteran banker.

Fahmi told Al-Ahram Weekly that during her time working for foreign banks, she had observed how initiatives of this sort could work. Clients would voluntarily contribute the small change from banking transactions and at the end of the year the accumulated sum would be donated to a charitable project.

Fahmi said that if applied in Egypt an initiative of this sort could generate LE20 million a year. There was a huge volume of banking transactions that included sums in piastres, she said. Some 10,000 cheques were cashed each year through the National Bank of Egypt, for example, and the piastres generated were considerable.

“These sums could be used to build new schools or sports fields that would serve children from poor neighbourhoods,” she said.

The idea of donation drives to solve economic or other problems is not new in Egypt. In the 1990s, the government initiated a donation drive to pay off Egypt’s debts, and more recently president Al-Sisi initiated the “Say good morning Egypt with a pound” campaign that calls on people to send an SMS giving one pound to the Long Live Egypt Fund.

Created soon after Al-Sisi came to power in 2014, this fund is also dedicated to development projects intended to benefit the poor.

One of these is the Asmarat housing project in the Moqattam area that calls for the construction of 12,800 housing units at a cost of LE1.5 billion. The project is part of government plans to eliminate informal housing in Deweika, Istabl Antar and Ezbet Kheir.

Fahmi said that Egypt was the first country to use donation drives of this sort. “At the time of the economic crisis during World War II, Egyptian cotton exports stopped. The finance minister at the time launched an initiative calling on people to contribute one piastre in order to solve the crisis,” she said.

Amr Tantawi, managing director of the Misr-Iran Development Bank (MIDB) and a member of the board of the Federation of Egyptian Banks, believes the initiative could be applied if it gains popular approval.

He said that his bank had not yet taken a decision to apply the idea and that it was waiting to see how the public reacted and whether the bank’s clients would approve of it.

He noted that one of the most common banking transactions that could be covered by the initiative involved government transactions such as pension and salary payments that are calculated down to the nearest piastre. Such transactions “could yield a good revenue,” he said.

According to reports, the Société arabe internationale de banque (SAIB) has held a meeting to study a possible mechanism for implementing the “small change” initiative. The thinking is that banks could transfer the small change donated by clients to the Long Live Egypt Fund dedicated to financing development projects.

In statements to the press, National Bank of Egypt Vice-President Yehia Aboul-Fotouh said his bank had yet to study ways to implement the proposal.

Azza Qoura, programme director for the Long Live Egypt Fund, said that the small change from gas and electricity bills could be included in the drive alongside small change from banking transactions.

In a television interview she said that “all those fractions of a pound could come to more than LE18 million a year,” adding that such sums could help provide alternative housing for informal housing area dwellers.

Former Central Bank of Egypt governor Ismail Hassan said that initiatives of this sort had the added benefit of raising public awareness of how important a few piastres could be. They might not mean much to many people, but they could be useful in helping the needy, he told the Weekly.

He said that many large stores in Egypt already applied the idea, placing collection boxes next to cash registers indicating the fund or charity any donations were intended to assist.

“The idea is already practiced, albeit not at the national level,” he said, adding that he thought people would respond favourably if the small change initiative was put into practice at the banks.

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