What is the role of Bank Al-Maghrib ?
Each country has its own central bank. A central bank is the “bank of banks”. Bank Al-Maghrib is the central bank of Morocco. The functions and organization of central banks vary across countries.
Bank Al-Maghrib monitors financial stability : prices should be stable; neither too low, nor too high
To understand how Bank Al-Maghrib monitors financial stability, we will proceed step by step:
What is a price ?
The value of things can be measured with money by setting their price. A price is the amount of money a buyer gives to a seller in exchange for a good or a service.
Prices may vary…
The value of things can change for several reasons, which may cause the prices to rise or to fall. Inflation happens when prices rise.
What is inflation, exactly ?
Inflation is the increase in the general level of prices over a long period. If the money in circulation is higher than the amount of products and services people can buy, the currency loses its value and inflation occurs.
Bank Al-Maghrib tries to maintain price stability. For this reason, it uses several means, among which controlling the quantity of money in circulation. There should not be too much or too little money. The quantity of money must correspond to the quantity of products and services available on the market.
Bank Al-Maghrib supervises banks in Morocco : All rules must be respected
Why does Bank Al-Maghrib supervise banks in Morocco ?
Bank Al-Maghrib controls all banks and ensures their financial health in order to ensure that their customers can safely deposit or withdraw their money at any time.
How does Bank Al-Maghrib handle supervision ?
The Bank sets out rules that banks must meet. For this reason, Bank Al-Maghrib controllers regularly visit banks to check their activities.
Banks transmit to Bank Al-Maghrib several documents to be controlled.
If banks do not comply with the rules set out by Bank Al-Maghrib, they can be sanctioned.
This work is done by a team of 70 people who ensure the proper functioning of our banking system.
Bank Al-Maghrib ensures the security of payment means and systems
What are payment means ?
In addition to coins and banknotes, there are other means of payment which can be used to make purchases such as the cheque, the bank card or the bank transfer.
The Cheque
Once you open a bank account (from the age of 18), you are granted a cheque book. The cheque is a payment means that you use to ask your bank to pay the amount you wrote on the cheque, to the person to whom you have delivered the cheque. If this amount is not available on the account, the bank rejects the cheque. Thus, you should never give a cheque if you do not have the amount you have written on it.
The Bank card
Like the cheque book, the credit card can be obtained by opening a bank account. This is a convenient means that can be used to pay for direct or online shopping, to withdraw money from ATMs*, perform transfers and check one’s bank account at any time.
The bank transfer
It allows transferring money from one bank account to another. Often, employees receive their salaries by bank transfer from their employer.
And the payment means ?
It refers to all the means which ensure currency circulation between banks.
Bank Al-Maghrib monitors these systems and means of payment to ensure their safe use by everyone.
To know more about payment means : "Fahime family" Payment means
Bank Al-Maghrib holds and manages foreign exchange reserves to guarantee foreign currency stocks
What is foreign exchange ?
Foreign exchange is the transaction whereby the currency of one country is exchanged against that of another country or group of countries. For example, if I travel to Europe, I will convert (exchange) my Dirhams into Euros in order to use them in Europe.
Similarly, people living abroad who come to Morocco have to exchange their currency against the dirham.
Stocks of foreign currencies are held and managed by Bank Al-Maghrib.
Bank Al-Maghrib produces coins and banknotes
Bank Al-Maghrib also prints banknotes and manufactures coins in Dirham.
Moroccan banknotes and coins are designed and manufactured at Dar As-Sikkah, the currency manufacturing plant which belongs to Bank Al-Maghrib.
Dar As-Sikkah also produces passports, cheque books and other secure documents.
