Iran is considering significant changes to its NIMA foreign exchange system, potentially signalling the end of the platform that has been central to the country's currency market since 2018, sources familiar with the matter told bne IntelliNews.

The NIMA system, introduced in May 2018 to facilitate foreign currency supply and create a secure environment for buyers and sellers, has been a key tool in Iran's multi-tiered exchange rate regime. It was designed to provide a transparent mechanism for currency transactions and to combat corruption in the face of US sanctions.

According to Iran's central bank, 54% of the currency on NIMA is supplied by the bank itself, with 34% coming from petrochemical companies and 6% from oil refineries.

"There are ongoing discussions among policymakers about either aligning the NIMA rate closer to the free market rate or potentially phasing out the system entirely," said an Iranian economic analyst who requested anonymity due to the sensitivity of the subject.

Critics argue that the system has failed to achieve its objectives of stabilising the currency market and promoting exports. Since the beginning of the current Iranian year in March, the NIMA exchange rate has risen from IRR410,000 to the dollar to IRR460,000, a 12% increase that has not resulted in the expected boost to exports.

The potential overhaul comes as Iran grapples with high inflation and economic challenges exacerbated by international sanctions.

Any changes to the NIMA system could have significant implications for Iran's import costs and, consequently, domestic prices.