In a decisive move to bolster transparency and fair competition in the financial sector, the Central Bank of Kuwait has initiated a thorough field inspection targeting exchange companies in Kuwait. This regulatory action focuses on evaluating how these firms set foreign exchange rates in Kuwait and calculate commissions for international money transfers.

Regulatory teams have posed critical inquiries to exchange firms about the methodologies used to determine exchange rates for the Kuwaiti dinar against major global currencies. Specific emphasis has been placed on the frequency of rate updates and how these adjustments are reflected during real-time customer transactions. Furthermore, authorities are investigating whether pricing structures and commission fees are standardized across all branches or vary by location.

Another key aspect under review is whether exchange rates and commissions differ based on customer categories or the size of transactions. Understanding these dynamics is crucial to ensuring that all customers—regardless of transaction volume or client status—receive fair and consistent pricing.

Adding a historical dimension to the current probe, the Central Bank is revisiting the financial penalties previously levied by the Competition Protection Authority on approximately 16 exchange firms. These penalties, ranging between 1% and 5% of total revenues for the fiscal years 2020 to 2022, were based on accusations of collusion to unify foreign exchange rates, contravening Kuwait’s competition regulations.

Despite the heavy fines, affected companies contested the rulings in court and secured judgments affirming their compliance with Kuwait's financial laws. The court decisions found no unlawful collaboration among these firms. Related article on legal updates in Kuwait

Even after the judicial outcomes, the Central Bank’s commitment to transparency remains unwavering. Inspectors have requested all communication records between exchange companies and the Competition Protection Authority, including legal documents associated with the contested fines. This step aims to verify that no informal agreements were reached to artificially manipulate or stabilize exchange rates.

The regulatory oversight aligns with broader efforts to protect consumer rights and promote a competitive market environment within Kuwait’s financial system.

Through these intensified measures, the Central Bank of Kuwait is reaffirming its dedication to maintaining a robust and transparent financial infrastructure. Safeguarding fair money transfer commissions and competitive foreign exchange rates in Kuwait not only fosters consumer trust but also positions Kuwait as a reliable hub for financial transactions across the region.