TUNIS, Aug 25 – Tunisia’s cash holdings have risen by about 16% over the past year to a record 30 billion dinars ($10.5 billion), according to central bank data released on Monday, as greater reliance on physical cash puts pressure on banks’ liquidity.
Banknotes and coins in circulation reached 30.04 billion dinars as of August 21, up from 25.9 billion dinars a year earlier.
The increase means more money is being kept outside bank accounts, potentially reducing the funds available to banks for lending to households and businesses.
Financial analysts say the rise has been partly driven by a new law introduced last year that tightened rules around the use of bank cheques and increased penalties for bounced or invalid cheques.
The changes have encouraged businesses and individuals to withdraw more money to make payments, further increasing the amount of cash in circulation and making liquidity management more difficult for banks.
Many Tunisians also continue to prefer cash for everyday transactions because electronic payments and digital banking have been adopted slowly across the country, particularly outside major cities.
