Sierra Leone - Country Commercial Guide
Trade Financing
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Methods of Payment

Cash and mobile payments are the most common methods of payment in Sierra Leone. Telecommunications companies are upgrading to enhance mobile money services and e-commerce specifically. One can also use checks, credit and debit cards, letters of credit, bills for collection, open accounts, and other internationally accepted modes of payment. Whatever the payment form, exporters must repatriate the proceeds of their exports before the export of another consignment. Import goods are quoted in “costs, insurance and freight” (CIF), while export goods are “free-on-board” (FOB). The customs authorities verify the authenticity of all transaction/business documents, and forgery is subject to harsh penalties.

For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide.

Banking Systems:

Sierra Leone’s banking sector, monitored by the Bank of Sierra Leone, consists of 14 commercial banks, 79 foreign exchange bureaus, 17 community banks, 44 microfinance institutions, two discount houses, a home mortgage finance company, a leasing company, two mobile financial services providers, and a stock exchange. Bank branches exist throughout the country, with activity concentrated in Freetown. The commercial banking sector is characterized by poor performance with significant financial vulnerability.

Foreign individuals and companies are permitted to establish bank accounts. ATMs are available in urban areas but limited in rural settings, as is electronic payment and the Bank of Sierra Leone is rolling out a “national payment switch” to facilitate connectivity among different banks’ electronic systems.

In July 2022, the Bank of Sierra Leone redenominated the Leone to simplify accounting records and reduce cash volumes needed for transactions. The redenomination eliminated three zeros from the old Leone and created a new 20 Leone denomination equivalent to 20,000 old Leone. The redenomination commenced in July 2022 and is set to conclude in December 2023.

As part of structural reforms in the banking sector under the Extended Credit Facility of the International Monetary Fund, the Bank of Sierra Leone pledged to establish a particular resolution framework for troubled financial institutions, establish a deposit insurance system, strengthen its capacity to supervise and oversee the non-bank financial institution sector and facilitate the adoption of International Financial Reporting Standards (IFRS) both internally and across the financial industry.

It is difficult to obtain funding locally through Sierra Leonean banks and other institutional investors. Financing for large projects is funded with a mixture of debt and equity from commercial and or development banks. Private sector funding, provided by commercial bank loans, attracts very high lending rates which makes commercial loans expensive. Most commercial banks limit their activities to short and medium-term finance. Inadequate supervisory oversight of financial institutions, weak regulations, and corruption have made Sierra Leone vulnerable to money laundering.

Foreign Exchange Controls:

In August 2019, the government mandated the exclusive use of the Leone for all contracts and payments, prohibited individuals and other entities from holding more than $10,000 or its equivalent in any foreign currency, and introduced a requirement that travelers must declare foreign currencies of more than U.S.$10,000 or its equivalent. Violation of these directives is punishable by law as stipulated in the 2019 Bank of Sierra Leone Act. In late 2020, however, an acute shortage of domestic currency hit the market, compelling the central bank to order sufficient domestic currency to meet the market demand and lift the restriction on foreign currency holdings to mitigate the effects of the scarcity.

The Investment Promotion Act of 2004 guarantees foreign investors and expatriate employees the right to repatriate earnings and the proceeds of the sale of assets. There are no restrictions on converting or transferring funds associated with investments, including remittances, earnings, loan repayments, or lease payments, so long as these transactions are done through the banking system.

With the approval of the Bank of Sierra Leone, investors can withdraw any amount from commercial banks and transfer the funds into any freely convertible currency at market rates, and the exchange rate is market-determined. Sierra Leone is a member of the Economic Community of West African States (ECOWAS), which has put forward a roadmap to launch a common currency, the ECO, though this process has repeatedly been delayed.

U.S. Banks and Local Correspondent Banks

Vista Bank Sierra Leone Limited is the only U.S.-owned bank in Sierra Leone. Most Sierra Leone banks have correspondent relationships with U.S. banks.

For additional information  on financing, visit the U.S. Department of State Investment Climate Statements.