Why Iraqi Citizens Avoid in Dealing with Iraqi Banks?

On Tuesday, the Iraqi Central Bank issued a statement that 89% of Iraqi adult population doesn’t have their own bank accounts and most people avoid from dealing with the banks due to some religious reasons. The Turkish agency “Anatolia” reported that the annual report 2016 of Iraqi Central Bank has mentioned that the 2014 estimates of the World Bank had indicated that the number of adults accounts among the total deposit accounts of Iraqi people were just 11%. It means that at least 89% of Iraqi adults don’t have their bank accounts. They prefer to deal with cash payments for their transactions. The report further indicated that the data shows that the percentage fell 6.5% in 2015 and 6.8% in 2016. The report pointed out that this decline was due to the CBI focused on the branches in the province of Baghdad, and less than 38% of the entire banks were operational in Iraq during the year 2016.

Why Iraqi Citizens Avoid in Dealing with Iraqi Banks?The report stressed that one of the major reasons was the reluctance of many Iraqi people in dealing with Iraqi banks for specific religious reasons. It was also pointed out in the report that an increase in currency according to money supply in the narrow sense of 59.5% in 2016 has clearly indicated of the desire of people settling their transactions in cash. A member of the Iraqi market for securities, Abdul Hussein Jassim said that Iraqi citizens don’t have confidence on Iraqi government banks. So, a majority of Iraqi citizens prefer manual financial transactions without involving Iraqi banking system. Jassim further added that thousands of customers weren’t able to withdraw their financial assets from some banks. It also exposed the eligibility of those banks due to their financial issues and it generated fears for resources of the banks. Last year, the Iraqi Central Bank has implemented the guardianship of at least 1 bank and a local bank after discovering instability in the financial liquidity.

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