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The Board of Directors of the Central Bank of Egypt (CBE) has issued new instructions regarding the licensing, oversight, and supervision of credit guarantee companies, in line with the Central Bank and Banking System Law No. 194 of 2020. These instructions aim to establish an integrated regulatory framework to support the financial soundness, stability, and operational efficiency of credit guarantee companies.

Licensing and Registration Requirements

Under the new rules, credit guarantee companies must be established as Egyptian joint-stock companies with fully nominal shares and a minimum issued and paid-up capital of EGP 50 million. The CBE mandated complete transparency in ownership structures, including identifying ultimate beneficial owners and related parties, verifying the legitimacy of funds, and ensuring compliance with market competition rules without conflicting with public economic interests. Furthermore, founders, beneficial owners, and key executives must demonstrate integrity, sound reputation, financial solvency, and relevant experience.

Governance, Risk Management, and Outsourcing

Companies are required to submit comprehensive financial and economic feasibility studies detailing business objectives, target sectors, risk measurement techniques, and hedging tools. The framework obligates companies to implement clear strategies, effective internal controls, risk management, governance, and outsourcing policies. Companies retain full accountability for services delegated to third-party technology and outsourcing providers. Additionally, qualified entities must be appointed to audit IT infrastructure and information security standards. Companies are also subject to an annual supervisory fee of EGP 100,000 payable every January.

Timeline for Regulatory Compliance

The CBE has granted credit guarantee companies a one-year grace period to adjust their status, extended to two years for compliance with information security, cybersecurity standards, and regulatory ratios. Companies must submit a detailed compliance timeline to the Supervision Sector within three months, identifying existing gaps and targeted corrective actions.