Dinar Savings Seeing Record Growth and Amounts – Continuing to Pay Off More than FX Savings

At the end of 2023, the dinar savings on retail accounts reached the new highest level at the end of a year, in the amount of RSD 138 billion, and at the beginning of 2024, it continued its dynamic growth and, according to the most recent operating data, it has exceeded RSD 144 billion. According to the website of the National Bank of Serbia (NBS), the growth of the dinar savings is the result of, above all, “the preserved trust in the local currency and banking system, whose stability has been retained even during the very turbulent global events.”

By looking at the cost-effectiveness of the savings with a one-year fixed-term, which had been renewed over a period of 11 years (from December 2012), it was determined that a person with dinar savings, for a deposit of RSD 100,000 at the end of the fixed-term period, would get nearly RSD 43,000 (EUR 370) more in December 2023 than a person with savings who would have an equivalent deposit in euros in the same period.

One-year dinar savings, which hadn’t been renewed, also paid off more that one-year euro savings in nearly all the observed annual subperiods (over 98%).

A saver who had savings in the local currency from December 2022, for a deposit of RSD 100,000, would get over RSD 2,500 more in December 2023 than a saver with a fixed-term deposit of RSD 100,000 in euro countervalue in the same period.

Three-month dinar savings paid off more than euro savings in most of the observed three-month subperiods (90%), whereas two-year dinar savings (long-term) paid off more than euro savings in all the observed two-year subperiods (100%).

The conclusion is that, in the analyzed period of 11 years, it was more cost-effective to save in dinars for all savings periods.

On a regular basis, the NBS promotes dinar savings, pointing to its greater cost-effectiveness in both the long term and the short term compared to FX savings, as part of the strategy of the dinarization of the financial system.

In the past 11 years, dinar savings have increased eight times – from RSD 18 billion to the current RSD 144 billion. FX savings have also nearly doubled in the same period, from EUR 8.3 billion at the end of 2012 to the current EUR 14.7 billion.

In the past year alone, at the end of January this year compared to last year’s January, dinar savings have increased by RSD 44 billion (45%). The trust in the local currency is also confirmed by the growth of long-term deposits within dinar savings, from RSD 1.4 billion in December 2012 to RSD 41.1 billion in January 2024.

Narodna banka Srbije Beograd

National Bank of Serbia

NBS

dinar savings

FX savings

cost effectiveness of savings

savings in local currency