A Bird in the Hand

As the NBU spokesman Dmytro Rikberh told The Day, the resolution was passed "to tighten control over the flow of cash funds." He specially noted that "the resolution is of an advisory nature." Thus if a client refuses to submit the relevant documents, alleging the absence of a law, nothing will happen to him.

Let us note that such a step of NBU could have been foreseen. As far back as May, the National Bank resolved to restrict the amount of cash operations for bank clients. The same resolution placed under the gunpoint of NBU regional branches the banks which wrote off their accounts the excessive cash amounts. Hence it is logical that Resolution No. 265 should have been initiated, as Mr. Rikberh explained, by the banks that want to get "the necessary tools" to affect clients who abuse the norms of decency.

However, the struggle against shadow transactions is only half the real reason why the NBU is combating cash deals. According to experts, the increased cash circulation was the result of both the liberalization of the currency market and the pre-election repayment of public-sector debts. In the former case, commercial banks, receiving cashless hryvnias on the currency market, would convert these into cash and issue the latter to their clients "for urgent purposes," such as payment for goods, services, and labor. In this case, most of the money would never return to the banking system. In the latter case, enterprises that legally service the population by cash are preoccupied with the same thing: how to convert their income into more reliable banknotes, for example, into cash dollars.

So the National Bank wants using this resolution to kill two birds with one stone: to reduce the scope of shadow operations that have increased on the eve of elections and to curb the entrepreneurs' inflation expectations that have risen for the same reason. Will the bank get at least one bird in the hand?