UAE short-changed? Coins shortage forces Emiratis to dig deeper in their pockets
Cash deposits in the Central Bank of the UAE amounted to Dh79.9 billion while cash withdrawals were Dh82.1 billion by end of May, leading to coins problem in the market, the bank said.
Due to the shortage for coins resulting from an increase in cash withdrawals of notes and coins which were at the end of May Dh1.1 billion in coins and Dh16.4 billion in notes, compared to cash withdrawals of Dh7.1 billion in coins and Dh17.5 billion in notes, and due to the overuse of coins in parking and vending, the UAE Central Bank had approved the issue more denominations of coins to meet demand.
In the past, the UAE Central Bank was minting all six denominations coins that are legal tender such as 1 fil, 5 fils, 10 fils, 25 fils, 50 fils and Dh1 in addition to a few commemorative coins. The new minting will be to cover the rise in demand for coins,which resulted from the wide spread of malls and co-ops in the UAE, where use of currency coins increased through parking fee payment machines and vending machines, a Central Bank source told Gulf News.
The Central Bank source did not specify the amount of coins in circulation but he said that banks usually do not keep a stock of coin denominations below 25 fils.
"The issue with coins started early January when the cash withdrawals were Dh10.5 billion compared to Dh782 million in deposits. This gap had continued," said the source.
'The Central Bank's Board has approved the recommendations submitted by the Banking Operations and Payment Systems Department to re-mint new quantities of coins of denominations, Dh1, 25 fils, and 5 fils due to a drop in the stock of currency coins of the said denominations,â€ the bank said.
On July 16, the board of the Central Bank held a meeting to discuss other issues such as management policy and approved introduction of some amendments, prudential ratios of the banking system, financial stability, Central Bank data and liquidity.
The Board also reviewed the opinion of the UAE Bankers Association on the limits of ratios which form large exposures and instructed study thereof by the experts concerned at the Central Bank and submission of necessary recommendations to the Board for approval.
The board reviewed draft amendments to the Moneychangers Regulation and instructed formation of a committee to follow-up amendments and report developments to the Board.
The Board also took note of the final proposed amendments to the Liquidity Regulations and instructed final review of the regulations in preparation for approval and issuance thereof as soon as possible.
The Board took note of the latest developments regarding draft of the Mortgage Loans Regulation, which had previously been referred to the concerned agencies for study and feedback, and instructed follow-up with the concerned agencies.
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