Iraq’s shift from a cash-heavy economy to a digital one is gaining momentum, but policy implementation will play a crucial role, the chairman of the country’s largest FinTech company has said.
The Central Bank of Iraq has announced that all government payments will move to electronic channels by July 2026, part of a broader plan that includes a national instant-payment platform and potentially even a digital dinar.
“The ambitions are always there, but the real need is to focus on a well-crafted and a world-class plan and the execution of it,” Bahaa Abdul Hadi, chairman and co-founder of International Smart Card, which owns the Qi Card, told The National.
Since early 2023, the Iraqi government has introduced financial and economic reforms, including the use of electronic payment systems by the government and private sectors. These also include regulations requiring electronic payment providers to tighten anti-money-laundering and cybersecurity rules.
The Central Bank of Iraq’s cashless mandate, point-of-sale incentives, e-Know Your Customer regulations, as well as other key components of this mandate “are all in place”, he said.
“What matters now is astute follow-through at the ministry level so that the Iraqi people actually reap the fruits of the mandate.”
Many Iraqis tap cards and phones instead of pulling wads of dinars from their pockets, a sign of changing payment habits. However, digital literacy remains the biggest challenge, Mr Abdul Hadi said.
“Teaching the Iraqi society why a tap or QR code scan is safer than a bundle of banknotes requires patient, empathetic education for millions of unbanked people.”
He says better incentives are needed to encourage more Iraqis to trust and adopt digital payment.
“I believe that when people experience real protection, they naturally switch from the banknotes to the digital payment,” he added.
From the government side, Mr Abdul Hadi said, the hardest challenge is managing timelines. “Regulators are juggling multiple reforms simultaneously, which often causes delays and sets us back to square one.”
Still, he is “extremely” optimistic about the future.
“Within the next five years, you will see a tipping point where digital solutions bridge the cash gap in urban Iraq. However, the rural areas may take about 10 years, but the direction is there and irreversible,” he said.
Cash could fall below 50 per cent of urban retail spending by 2030 “if the current momentum continues”. The tipping point will be universal QR payment acceptance and real-time open banking, both of which are in the pilot phase.
“A fully digital ecosystem in Iraq is therefore not a distant goal; it’s the trajectory we are actively pursuing,” Mr Abdul Hadi added.
From payrolls to fintech
Launched in 2007 by International Smart Card, the Qi Card began as a service to pay public-sector salaries and pensions electronically.
Today it claims to have more than 11 million users and a network of 23,000 point-of-sale terminals reaching every Iraqi governorate, including remote villages.
The company’s services have expanded beyond salary disbursement to retail and bill payments, remittances, buy-now-pay-later (BNPL), micro-savings and a smartphone app that accounts for the majority of transactions.
“Just five years ago, most Iraqis got to know us at a card terminal,” Mr Abdul Hadi said. “Today, six out of 10 Qi payments start from a personal smartphone wallet or with a QR tap.”
Qi Card is now exploring expansion in regional markets, including the UAE and Jordan. Its payment gateway application is in the final stages of approval by the Central Bank of the UAE. In Jordan, it has established a back office in Amman, which focuses on risk and compliance standards.
“Our top priority is serving the Iraqi diaspora in the GCC and Europe,” he said. “Beyond that, we see strong synergies in Jordan and Oman. The Levant is also on our radar, where we are exploring select markets where cash is still king – subject to the local regulatory approvals,” he added.
Misuse allegations
For the government and the central bank, the stakes are high. Moving millions of Iraqis from cash to cards and mobile wallets could curb corruption, widen financial inclusion and stabilise the dinar. Yet the same systems could also be exploited if controls fail.
Whenever our system detects a red flag, we immediately off-board the suspicious account
Bahaa Abdul Hadi,
chairman and co-founder of International Smart Card, which owns Qi Card
In May, The Wall Street Journal alleged that Qi’s cards were exploited in dollar arbitrage schemes benefiting Iran-backed groups, allowing local salaries to be converted into hard currency overseas to help Iran circumvent US sanctions.
The WSJ alleged that cross-border card transactions by the Popular Mobilisation Forces, an umbrella paramilitary movement, surged from $50 million to $1.5 billion monthly between early 2023 and April 2023, generating an estimated $450 million in profits in 2023 alone.
Some commanders seized subordinates’ payment cards, or created fake identities to obtain additional payouts, it added.
Mr Abdul Hadi firmly rejected the claims, saying Qi maintains “zero tolerance” for any illicit use.
“Whenever our system detects a red flag, we immediately off-board the suspicious account,” he said, adding that more than 3,000 accounts have been blocked. He did not elaborate.
“Where third parties have attempted to exploit the broader card ecosystem for arbitrage, we have actively collaborated with the Central Bank of Iraq, Visa and Mastercard – taking measures such as freezing accounts, capping cross-border volumes, and blocking thousands of suspicious cards,” he added.
The company uses biometric authentication, geofencing and real-time monitoring to detect abuse, he said. In June, it also signed a three-year partnership with US consultancy K2 Integrity to strengthen oversight.
None of the US agencies have contacted Qi Card to date over these allegations, Mr Abdul Hadi said.
“We have not received any warning or any enforcement notice,” he said. The company is “fully committed to co-operating with both US authorities and Iraqi regulators, should they request information through lawful channels”.
However, Qi Card has stopped disbursing salaries for the Popular Mobilisation Forces. “This decision was made in consultation with our risk and compliance advisers to ensure full alignment with international regulations and to stay away from the US pressure.”
The US has long warned that the PMF is strengthening Iran’s influence and undermining Iraq’s sovereignty. America has blacklisted several of the group’s senior leaders, including its chairman Falih Al Fayyadh.
Under pressure from the US and other foreign powers, the Iraqi government also withdrew a contentious draft law for the PMF in August, which aimed to widen its powers and elevate its status to be on a par with the rest of the Iraqi military.
Results
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Winner: Golden Goal, Pat Dobbs, Doug Watson.
THE LIGHT
Director: Tom Tykwer
Starring: Tala Al Deen, Nicolette Krebitz, Lars Eidinger
Rating: 3/5
Citizenship-by-investment programmes
United Kingdom
The UK offers three programmes for residency. The UK Overseas Business Representative Visa lets you open an overseas branch office of your existing company in the country at no extra investment. For the UK Tier 1 Innovator Visa, you are required to invest £50,000 (Dh238,000) into a business. You can also get a UK Tier 1 Investor Visa if you invest £2 million, £5m or £10m (the higher the investment, the sooner you obtain your permanent residency).
All UK residency visas get approved in 90 to 120 days and are valid for 3 years. After 3 years, the applicant can apply for extension of another 2 years. Once they have lived in the UK for a minimum of 6 months every year, they are eligible to apply for permanent residency (called Indefinite Leave to Remain). After one year of ILR, the applicant can apply for UK passport.
The Caribbean
Depending on the country, the investment amount starts from $100,000 (Dh367,250) and can go up to $400,000 in real estate. From the date of purchase, it will take between four to five months to receive a passport.
Portugal
The investment amount ranges from €350,000 to €500,000 (Dh1.5m to Dh2.16m) in real estate. From the date of purchase, it will take a maximum of six months to receive a Golden Visa. Applicants can apply for permanent residency after five years and Portuguese citizenship after six years.
“Among European countries with residency programmes, Portugal has been the most popular because it offers the most cost-effective programme to eventually acquire citizenship of the European Union without ever residing in Portugal,” states Veronica Cotdemiey of Citizenship Invest.
Greece
The real estate investment threshold to acquire residency for Greece is €250,000, making it the cheapest real estate residency visa scheme in Europe. You can apply for residency in four months and citizenship after seven years.
Spain
The real estate investment threshold to acquire residency for Spain is €500,000. You can apply for permanent residency after five years and citizenship after 10 years. It is not necessary to live in Spain to retain and renew the residency visa permit.
Cyprus
Cyprus offers the quickest route to citizenship of a European country in only six months. An investment of €2m in real estate is required, making it the highest priced programme in Europe.
Malta
The Malta citizenship by investment programme is lengthy and investors are required to contribute sums as donations to the Maltese government. The applicant must either contribute at least €650,000 to the National Development & Social Fund. Spouses and children are required to contribute €25,000; unmarried children between 18 and 25 and dependent parents must contribute €50,000 each.
The second step is to make an investment in property of at least €350,000 or enter a property rental contract for at least €16,000 per annum for five years. The third step is to invest at least €150,000 in bonds or shares approved by the Maltese government to be kept for at least five years.
Candidates must commit to a minimum physical presence in Malta before citizenship is granted. While you get residency in two months, you can apply for citizenship after a year.
Egypt
A one-year residency permit can be bought if you purchase property in Egypt worth $100,000. A three-year residency is available for those who invest $200,000 in property, and five years for those who purchase property worth $400,000.
Source: Citizenship Invest and Aqua Properties
House-hunting
Top 10 locations for inquiries from US house hunters, according to Rightmove
Edinburgh, Scotland
Westminster, London
Camden, London
Glasgow, Scotland
Islington, London
Kensington and Chelsea, London
Highlands, Scotland
Argyll and Bute, Scotland
Fife, Scotland
Tower Hamlets, London
Some of Darwish’s last words
“They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope.” – Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
Why your domicile status is important
Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live – is assessed every year, your domicile status is assessed over your lifetime.
Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born.
UK residents who have their permanent home (“domicile”) outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.
A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.
Conflict, drought, famine
Estimates of the number of deaths caused by the famine range from 400,000 to 1 million, according to a document prepared for the UK House of Lords in 2024.
It has been claimed that the policies of the Ethiopian government, which took control after deposing Emperor Haile Selassie in a military-led revolution in 1974, contributed to the scale of the famine.
Dr Miriam Bradley, senior lecturer in humanitarian studies at the University of Manchester, has argued that, by the early 1980s, “several government policies combined to cause, rather than prevent, a famine which lasted from 1983 to 1985. Mengistu’s government imposed Stalinist-model agricultural policies involving forced collectivisation and villagisation [relocation of communities into planned villages].
The West became aware of the catastrophe through a series of BBC News reports by journalist Michael Buerk in October 1984 describing a “biblical famine” and containing graphic images of thousands of people, including children, facing starvation.
Band Aid
Bob Geldof, singer with the Irish rock group The Boomtown Rats, formed Band Aid in response to the horrific images shown in the news broadcasts.
With Midge Ure of the band Ultravox, he wrote the hit charity single Do They Know it’s Christmas in December 1984, featuring a string of high-profile musicians.
Following the single’s success, the idea to stage a rock concert evolved.
Live Aid was a series of simultaneous concerts that took place at Wembley Stadium in London, John F Kennedy Stadium in Philadelphia, the US, and at various other venues across the world.
The combined event was broadcast to an estimated worldwide audience of 1.5 billion.
Reading List
Practitioners of mindful eating recommend the following books to get you started:
Savor: Mindful Eating, Mindful Life by Thich Nhat Hanh and Dr Lilian Cheung
How to Eat by Thich Nhat Hanh
The Mindful Diet by Dr Ruth Wolever
Mindful Eating by Dr Jan Bays
How to Raise a Mindful Eaterby Maryann Jacobsen
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UAE currency: the story behind the money in your pocketsNapoleon
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