Kazakh citizens’ confidence in tenge on the rise as tenge deposits grew to 56%

The systematic growth of savings in banks is accompanied by an increase in demand for the national currency. At the end of September, it is tenge that is the main currency of savings: 55.6% (4.9 trillion tenge) of all deposits are kept in national currency. Deposits in foreign currency, in turn, amount to 44.4% (3.9 trillion tenge).

The share of tenge deposits has considerably increased in recent years - from a much less impressive 23.6% in 2015. The trend indicates a growing confidence of the population in the national currency, as well as a decreasing interest in foreign currency deposits due to their low profitability. So, for example, the average rate of deposits offered by banks in tenge is at the level of 9.2%, while the rate on foreign currency deposits is 1%.

The corporate sector is also increasing interest in the national currency. At the end of September this year, the amount of deposits of legal entities amounted to 6.7 trillion tenge - 1.5% more than in the same period last year. The tenge deposits increased from 47.8% in 2018 to 51.2% in 2019, and in terms the amount there was an 8.9% increase, up to 3.4 trillion tenge.

The legal entities’ deposits in foreign currency, in turn, decreased by 5.2% within the year and amounted to 3.3 trillion tenge. Their share decreased from 52.2% to 48.8%.

At the end of September of this year, 299.5 thousand companies were operating in Kazakhstan, of which 2.4 thousand are large, 6 thousand are medium-sized, 291.1 thousand are small.

Another important aspect is the market for cashless payments as e-commerce is gaining momentum in Kazakhstan. The purchase of a product or payment for services is made by bank transfer. For nine months of the current year, the total volume of non-cash transactions doubled during the year and amounted to 8.3 trillion tenge (a year earlier - 4.2 trillion tenge). At the end of September of 2019, the funds of Kazakh citizens on the current accounts of the second-tier banks amounted to 1 trillion tenge, of these, 79% were in national currency (a year earlier - 73%).

In September of this year the volume of money transfers in Kazakhstan amounted to 4.5 billion tenge (in 2018 - 6.1 billion tenge), with 23.6 thousand transactions. In terms of currencies, a clear predominance of tenge is noticeable - 62.3% (a year earlier - 51.4%), followed by the US dollar - 34.6% of all transfers. Russian ruble and euro represent 2.1% and 1%, respectively.

For comparison: the volume of transfers sent abroad for the same period amounted to 65.5 billion tenge. The geography of transfers is as follows: Russia - 18.3 billion tenge (28%), Uzbekistan - 16 billion tenge (24.4%), Turkey - 10 billion tenge (15.3%). A total of 44.3 billion tenge, or 67.7% of all international transfers, were sent to the said countries.

November 15 marks Kazakhstan National Currency Day.

At the end of September 2019, more than 2.2 trillion tenge of cash was in circulation (at the end of 2018 - 2.3 trillion tenge).

It is important to note that the tenge is one of the highly protected currencies in the world. In 2018, the National Bank and second-tier banks identified 1.4 thousand counterfeit banknotes, 17.9% less than in 2017 (1.7 thousand banknotes), that is, there are only three counterfeits per million Kazakh banknotes. According to the framework of individual European central banks, 10 counterfeit banknotes per one million real currencies are the first (low) counterfeiting rates.

One of the important tasks of the National Bank is to ensure the quality of money in cash circulation, including aesthetic perception, sanitary safety and banknote protection. In order to efficiently organize cash circulation and increase the service life of lower denominations, the National Bank decided to issue a circulation coin with a face value of 200 tenge in 2020.

Photo: open source