The money stored in the mattress has risen to a record level in Romania: more than 65 billion lei at the end of this summer. Growth since the spring has been relatively strong: over 5% from the first to the second quarter.
For comparison, this amount exceeds the market capitalization of Renault, Volvo or Carrefour. Even denominated in euros, the value of liquidity outside the banking system increased 5 times: from 3 billion euros to more than 15 billion euros this summer.
If we estimate an average price of EUR 60,000/house, the invested money will ensure the purchase of about 200,000 houses, i.e. the entire housing stock of at least 20 counties in Romania.
The appeal of hard cash may increase for several reasons, one of which is the evolution of the economy (people expect tough times and prefer to keep cash on hand). Another reason is related to the fact that people with low incomes prefer to use cash instead of bank cards, and the third is related to a possible political or economic crisis, which may lead to an increase in the use of cash, because people may have less confidence in the reliability of the financial system in general.
Data published by the National Bank show that every year people keep more money in the mattress, but we do not have a survey that would show the reasons for this increase in cash. Over the past 10 years, this money “in the stocking” has almost tripled.
It is not difficult to assume that, given that young people from 16 to 24 years old are the users of electronic payments, money in the mattress is saved by adults either just in case or just in case. days will come or inflation will rise.
The reduction of bank branches and the number of ATMs (as well as “white” areas in some rural areas of the country also contributes to this behavior of hoarding money.
In Romania, the share of the banked population is 60%, and the level of use of basic financial services is the lowest in Europe. A low level of financial literacy, a high level of the shadow economy and the preference of consumers and companies for cash contribute to such results. Romania’s figures are significantly lower than other countries in the region, the share of the banked population is 78% in Hungary, 81% in Bulgaria and 86% in Croatia,
Source: Hot News
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.