“Neutral impact”: what does the extension of restrictions on cash withdrawals mean for Russians and banks

From Thursday, March 9, restrictions on foreign currency cash withdrawals have been extended in Russia for another six months - until September 9.

This decision was previously taken by the Central Bank of the country.

As follows from the press release of the Central Bank, bank customers can still receive foreign currency from deposits equivalent to no more than $10,000 if the deposit was opened before March 9, 2022.

Within the limit, money is issued only in dollars and euros, regardless of the currency of the account itself, and all other funds can be withdrawn in rubles.

Moreover, if a person has several foreign currency accounts or deposits in one bank, you can receive a total of no more than $10,000 in cash. If foreign currency deposits were opened in different credit organizations, then each of them can issue up to $10,000.

“For banks, the ban has been extended for six months to charge citizens a commission when issuing currency from accounts or deposits.

Currency transfers without opening an account and through electronic wallets are issued in rubles," the Central Bank added.

In addition, financial institutions can still sell to the public only those dollars and euros that have entered bank cash desks since April 9, 2022.

There are no restrictions on the purchase by Russians of other foreign currencies today.

As noted in the Central Bank, legal entities until September 9 can receive cash for travel expenses, based on the payment standards established in accordance with the law, but not more than $5,000 or the equivalent amount in euros, pounds sterling or Japanese yens.

These banknotes are not issued to non-resident legal entities at the moment.

There are no restrictions for other currencies.

We also note that now it is impossible to export foreign banknotes with an equivalent of more than $10,000 from Russia. At the same time, citizens of the Russian Federation and friendly countries can withdraw up to $1 million per month to foreign accounts, and no more than $10,000 through money transfer systems.

Recall that a special procedure for operations with cash currency was launched in Russia exactly a year ago.

At that moment, it was assumed that the mechanism would operate for only six months, but later the Central Bank extended the initiative - first until March 9, and now until September 9, 2023.

As explained in the Central Bank, Western countries, as part of the sanctions policy against Moscow, prohibit the sale of their currency to Russian financial institutions.

Thus, the supply of foreign banknotes in the Russian Federation is now limited, so the regulator considers it necessary to maintain the current conditions for the circulation of foreign cash banknotes.

“Restrictions on the movement of capital and currency restrictions ... were extremely important for the rapid stabilization of the situation (in the financial market. -

).

Over the course of a year ... we - many of them - either softened or canceled them.

But in the future, since we do not expect fundamental external changes, these restrictions will remain,” explained Elvira Nabiullina, Chairman of the Bank of Russia.

• AP

• © Artem Kudryavtsev/Russian Central Bank Press Office

Note that the measures initially taken by the Central Bank were more stringent.

So, for example, in March 2022, the Central Bank for a certain time completely banned Russians from buying foreign currency at bank cash desks.

The actions of the regulator in many ways made it possible to stop the sharp collapse of the ruble exchange rate, avoid panic among the population, and also prevent a massive outflow of funds from bank deposits and the withdrawal of capital from the country against the backdrop of sanctions.

This was told to RT by Natalia Milchakova, a leading analyst at Freedom Finance Global.

“Subsequently, by the summer of 2022, when the ruble stabilized and even began to sharply strengthen, currency restrictions were eased.

Nevertheless, no one is going to cancel them completely yet.

Of course, for holders of large foreign exchange deposits, this is not the most pleasant news, but the vast majority of the population and the economy as a whole benefit from these measures, since the collapse of the ruble has stopped,” Milchakova said.

No risk to the system

Further extension of existing restrictions is unlikely to seriously affect the citizens and the country's banking sector.

This point of view was expressed in a RT commentary by the head of the information and analytical content department of BCS World of Investments Vasily Karpunin.

“Our financial system has been working quietly in the new conditions for a year now.

So the decision of the Central Bank is likely to have a neutral impact,” the analyst suggested.

A similar point of view is shared by the investment strategist of the management company Arikapital Sergey Suverov.

In his opinion, banks have largely adapted to the situation.

In turn, a number of other instruments for investment are now available to people, in addition to currency.

In particular, we are talking about gold, the expert noted.

“Of course, in the past, many citizens used cash dollars and euros for savings, so it may be more difficult for them today to switch to other forms of investment.

However, if we talk about banking operations, they did not suffer from the restrictions of the Central Bank, ”Suverov added in a conversation with RT.

In addition, in the context of the current measures of the Central Bank, citizens may have difficulty buying foreign currency for foreign trips.

However, the flow of tourists abroad is still relatively low, so this problem is insignificant on the scale of the entire economy, Alexander Razuvaev, a member of the Supervisory Board of the Guild of Financial Analysts and Risk Managers, is sure.

“As for deposits in dollars and euros, the rates on them in Russian banks are now around zero.

In this sense, for example, dirhams and yuan become more profitable for saving money.

It is also worth noting that the interest on deposits in rubles is now, in principle, comparable to inflation, so the Russians do not really lose anything when storing money in the national currency, ”concluded the interlocutor of RT.