The Central Bank of Iran has allowed three more domestic banks to provide vault services for online gold and silver trading platforms, a move aimed at increasing competition and strengthening oversight of the fast-growing market.

According to state media, Bank Mellat, Saman Bank and Bank Saderat Iran are in the final stages of connecting to the central bank's supervisory system for gold trading platforms. Following final testing, the three lenders will begin signing agreements with licensed online gold and silver marketplaces.

Iran has tightened oversight of online precious metals trading in recent years as retail demand for gold has increased amid persistent inflation and currency depreciation. Recent move is intended to strengthen investor protection while reducing concentration in the custody of physical bullion.

Their entry will end the concentration of vault services among a limited number of institutions, although officials said implementation would take time because of the security and operational requirements involved.

The expansion follows regulations introduced by the Central Bank of Iran on June 15 over the online trading of gold and silver. The rules allow approved legal entities to provide vaulting services for bullion traded through licensed digital platforms.

As per the rules, only banks and credit institutions that meet the central bank's security standards and receive clearance from Iran's Law Enforcement Command (FARAJA) may operate approved bullion vaults. The central bank will soon publish the list of authorised vault operators.

The regulations also establish procedures covering the storage and delivery of gold and silver bullion, authenticity verification, insurance, customer deliveries and inventory management for online trading platforms.