Currently, The bills and coins in the possession of the public reach $14,283.288 million. On the other hand, according to a report from the Association of Argentine Banks (ADEBA), deposits in pesos from the private sector, measured in real terms, grew for the second consecutive month. The growth represents an increase of 122% compared to the same month of the previous year and already exceeds $64.5 billion.
Meanwhile, private sector deposits in dollars grew 33% in October and maintain an upward trend for eleven consecutive months, which coincides with the beginning of the Milei administration. The sharp rise in recent months was a product of money laundering. Today, these deposits in hard currency exceed US$30 billion.
In this context, Banks no longer have vaults to deposit banknotes. With some humor, Claudio Cesario, president of the Association of Banks of Argentina (ABA), stated that they have already become “builders.” Many entities had to implement sarcophagi to complement their own storage space.
“An important issue to resolve, even though notable progress was made this year, has to do with the cash administration and management. As you know, years and years with high inflation and no issuance of larger denomination bills caused the accumulation of bills in the banks’ treasuries, that have exceeded the BCRA’s capacity to receive and store these, to the point that entities have had to build new vaults,” said the sector representative.
“The issuance of higher denomination banknotes requires the prompt and urgent demonetisation of lower value banknotes. In basic Spanish and so that it is understood: There is no installed capacity to store them. The volume of bills issued is so crazy that to illustrate the problem, if we line them up we can circle the Earth 43 times or we could build four towers on the Moon. Final data; The storage capacity in thousands of bills of the main collecting banks is greater than that of the New Orleans Federal Reserve. An absurdity of installed capacity and resources used if we compare the value of what is stored,” stated the banker.
According to data from the Central Bank, as of October 15, $1,000 bills were the ones that led in quantity, with 5,701.1 million units. They are followed by those of $500 (1,389.1 million) and those of $2,000 (1,105.7 million). Therefore, it is suggested that, as larger denomination bills are issued, such as $20,000, HE progressively replace those of lower denomination.
In this way, the capacity to store them is expanded and progress is made in solving the problem of the vaults, although, ultimately, the objective is to increasingly store more towards a “digital money” economy.
Use of cash: change of trend?
Argentina is positioned as the country that leads in Latin America the digital transformation in reference to means of payments, with a record level of 95% of inhabitants who use payment applications on their mobile devices, a figure that exceeds the average for the region.
Although 95% of the inhabitants of Argentina have at least one payment wallet installed on their cell phone, andThe use of cash continues to be a prevalent means of payment in the country. The figure for handling cash equals the use of virtual payments, with 95% of the population still using it, according to a recent Ipsos report.
Source: Ambito
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