The Central Bank of the Republic of Turkey recently announced that it has decided to offer incentives to gold deposit and participation fund holders who wish to convert their holdings into lira time deposits, according to a statement from the central bank.
Incentive Programs Designed to Improve Financial Stability
The Central Bank of the Republic of Turkey (CBRT) has launched an incentive program to encourage Turkish residents to convert their gold deposits and participation funds into lira time deposit accounts.
The central bank stated in a brief statement released in late December 2021 that this incentive scheme is intended to “support financial stability.” Turkey, as has been widely reported, is experiencing a severe economic crisis, which has resulted in a sharp depreciation of the lira and a rise in prices.
As a result of the falling currency and rising inflation rate, more Turkish residents are seeking refuge in alternative stores of value such as gold and digital currencies. The number of daily cryptocurrency trades in that country recently surpassed one million, according to Bitcoin.com News. This milestone suggests that more Turks are opting for alternative investments like bitcoin and gold to protect their savings.
Time Deposits in Lira Conversion
As part of the Turkish government’s latest attempt to stem the lira’s decline, the central bank stated in a statement that “deposit and participation fund holders” who choose to convert their funds to lira will be rewarded.
According to a statement released by the central bank on December 29, “the Central Bank of the Republic of Turkey has decided to provide [an] incentive to deposit and participation fund holders in the event that their gold deposits and participation funds are converted into Turkish lira time deposit accounts at the account holder’s request.”
However, the statement is silent on how the CBRT intends to compensate residents who agree to have their gold or participation funds converted.
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