The Central Bank explained the increased demand for cash by the economy of new regions

The increased demand for cash is due to the economy of new regions of Russia. This was announced by Deputy Chairman of the Central Bank Alexei Zabotkin.

Zabotkin noted that increased demand for cash has been observed since the fourth quarter of 2022 and continued into 2023. He added that the deviation from the normal indicators is not as significant as in March and September last year, it does not create problems.

According to Zabotkin, this is due to the fact that since January 1, cash hryvnia has ceased to circulate in the new regions of Russia and all payments have been converted into cash rubles. “In our opinion, this is due to the fact that in the new regions of the Russian Federation, where non-cash payments are noticeably less common for obvious reasons, cash is actively used. <…> Accordingly, this demand from new regions appears to be reflected in this increased demand for cash in the economy as a whole.” concluded Deputy Chairman of the Central Bank (quote from RIA Novosti).

According to the latest data from the Central Bank, in April the volume of cash in circulation outside the Central Bank made up 17 trillion rubles, which is a record figure for the entire period of publication of statistics. The growth was 3%.

On September 30, 2022, Russian President Vladimir Putin and the heads of the DPR, LPR, Kherson and Zaporozhye regions signed agreements on the regions joining Russia. On October 4, the Federation Council, following the State Duma, ratified all the treaties, and the next day, Russian President Vladimir Putin signed federal laws on the admission of four new subjects to the Russian Federation.