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Agreement for Local Currency Payment System with Paraguay

Today, the Board of the BCRA has approved the Operating Regulation for implementing the Agreement for Local Currency Payment System (Sistema de Pagos en Moneda Local, SML) with the Central Bank of Paraguay (BCP), effective as from June 22, 2021. The SML will channel payments for transactions made among natural or legal persons residing or headquartered in Argentina or Paraguay.

Paraguay is now the third country—after Brazil and Uruguay—that signed an agreement with the BCRA for the SML.

The transactions that may be carried out through the SML are as follows:

- Advance and collection of Argentine exports of goods and related services documented in pesos.

- Payment of Argentine imports of goods and related services documented in guaranies.

- Payment of pensions and other social security benefits granted by social security institutions, provided there is a bilateral agreement between both institutions.

In the case of Paraguay, the following transactions are also allowed:

- Advance and collection of Argentine exports of goods and related services documented in guaranies.

- Collection of services not related to the foreign trade of goods—except for financial services—rendered by Argentine residents to Paraguayan residents, and documented in pesos or guaranies.

- Payment of services not related to foreign trade of goods—except for financial services—rendered by Paraguayan residents to Argentine residents, and documented in pesos or guaranies.

- Family remittances.

In all cases, financial institutions shall require clients to submit an affidavit stating that the transaction falls within the scope of the SML and complies with the applicable specific and general regulations.

The exchange rate applicable will be published by the central banks of Argentina and Paraguay on a daily basis.

June 17, 2021

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