BCEAO (BCEAO)
The BCEAO, the Central Bank of West African States, is the single central bank of the eight countries of the West African Economic and Monetary Union. It issues the West African CFA franc (XOF) and regulates banks, payment systems and e-money across the union.
Also called: Central Bank of West African States · Banque Centrale des États de l'Afrique de l'Ouest
Headquartered in Dakar, the BCEAO serves Benin, Burkina Faso, Côte d'Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo. It conducts one monetary policy for all eight, manages their pooled foreign exchange reserves and maintains the euro peg of the CFA franc.
Its rules matter directly to payment businesses. The BCEAO sets the framework for electronic money issuers, payment service providers and money transfer across the union, operates the regional real-time gross settlement and clearing systems, and administers exchange-control regulations on transfers out of the zone.
A 2019 agreement with France ended the requirement to hold part of the union's reserves with the French Treasury and removed French representatives from the bank's governing bodies, while keeping the convertibility guarantee.
In practice
A licence or approval under BCEAO rules does not extend to the Central African CFA zone, which has its own central bank and its own rulebook.
Commonly confused with
| Term | How it differs |
|---|---|
| BEAC | The BCEAO issues XOF for eight West African states. The BEAC issues XAF for six Central African states. They are separate institutions with separate rules. |
See also
- CFA FrancThe CFA franc is the name shared by two separate currencies used by fourteen African countries: the West African CFA franc (XOF) and the Central African CFA franc (XAF). Both are pegged to the euro at the same rate but are issued by different central banks.
- BEACThe BEAC, the Bank of Central African States, is the single central bank of the six countries of the Central African Economic and Monetary Community (CEMAC). It issues the Central African CFA franc (XAF) and enforces the zone's foreign exchange regulations.
- Central BankA central bank is the public institution that issues a country's currency, sets monetary policy, holds its foreign exchange reserves and acts as banker to commercial banks and the government. Most also run the core payment system and lend in emergencies.
- Currency PegA currency peg is a policy under which a central bank fixes its currency's exchange rate to another currency or a basket and stands ready to buy and sell at that rate. The peg lasts only as long as the reserves and credibility behind it.
- RTGSRTGS stands for real-time gross settlement: a system that settles each payment individually and finally in central bank money, rather than offsetting many payments against each other and settling only the difference at the end of a cycle.