Modernizing the Payment System and Credit-Reporting Infrastructures in Djibouti

Project Development Objective (PDO)

This project aims to support the modernization of Djibouti’s payment and credit-reporting infrastructures through the development of a national strategy. This strategy will outline (a) functional requirements for the payment and credit-reporting systems, (b) improvements to the legal and regulatory frameworks, and (c) implementation of oversight frameworks for the payment and credit-reporting systems.


The Central Bank of Djibouti (CBD) has requested the assistance of the World Bank in an effort to develop strategies for improving Djibouti’s financial infrastructure.

National Payment System
Cash dominates Djibouti’s national payment system (NPS), which also lacks some of the core elements that should constitute a NPS. The legal and institutional frameworks for the NPS will require significant reform to become safer and more efficient. Lastly, Djibouti’s financial infrastructure does not comply with international standards (specifically, the Principles for Financial Markets Infrastructures developed by the Bank for International Settlements’ Committee on Payment and Settlement Systems and the International Organization of Securities Commissions’ Technical Committee).

Credit-Reporting System
The CBD is also seeking to reform its credit-reporting system (CRS) to bring it up to date, to increase its functionality, and to reduce its reliance on manual inputs. Currently, the CBD manages the credit registry and the bounced checks file, which are the only two structured sources of credit information available for risk assessment to bank supervisors and lenders.


The project team is providing technical assistance to develop an NPS development strategy that is based both on the applicable international standards and on the nine pillars that form the technical and regulatory frameworks for a country’s payment and settlement systems.

Additionally, the project team is designing a CRS development strategy that uses the general principles for CRSs—developed by the World Bank—as the organizing framework and that is compliant with international standards. The team is also (a) helping to draft laws and regulations supporting the modernization of Djibouti’s NPS and CRS; (b) developing effective oversight frameworks; and (c) providing a detailed report on the technical specifications required for implementation of Djibouti’s NPS and CRS.

Expected Outcomes

The main expected outcomes of the project are as follows:

1.  Implementing strategies to modernize Djibouti’s CRS and NPS

2.  Making already-enacted NPS and CRS laws and regulations consistent with international

3.  Developing a robust and effective oversight framework for the NPS and the CRS

4.  Modernizing the credit registry by including more individuals and firms, more in-depth data, and
     more credit reports

5.  Enacting the payment system law, electronic funds transfer, and oversight regulations

6.  Increasing use of electronic-based payment instruments

7.  Encouraging non-bank payment service providers to participate in the formal payment network

8.  Increasing use by lenders of credit reports in the loan underwriting process, which will save time
     and costs, and which will allow lenders to go “down the market” to reach to underserved
     segments of the population

9.  Increasing use by regulators and supervisors of credit reports for prudential regulation and for
     off-site inspection of banking institutions