Money and its purpose from a very early childhood are familiar to a person anywhere in the world. Money is what people get for their work, and what they pay for, acquiring for themselves everything that is necessary for life. Hence the concept of cash turnover, which depends on the total mass of goods and services in the country, price level and other economic indicators.
The sum of all payments
In the economy of any country, a huge number of banknotes, coins, checks, bills are constantly rotating, people pay with bank cards and other payment instruments. Each payment method has its own characteristics and globally depends on the characteristics and characteristics of the country's economy. In the modern world, cash turnover is often substantially less in volume than non-cash methods.
The right to issue (print) paper money and to mint coins has only the treasury or the federal authorities of the states. The sum of all operations performed with their help is cash turnover. It:
- Payment of remuneration for labor, pensions, social benefits, material assistance, interest.
- Issuance of depositors, loans, interest to depositors and customers of banks.
- Contribution of savings to banks by the population.
- Payment of taxes.
- Payment of utilities, transport and other services.
- Accumulation of savings by the population.
In another way, one can say that cash turnover is a constant cycle of money between banks, organizations and the population among themselves in different directions. In other words, these are all payments that are made in the form of mutual settlements with money for a certain period of time.
And although this is not the largest part of the turnover, its component is significant in the country's economy. Usually its share is not more than 10 percent of all mutual payments
Scientists economists note that the share of cash turnover significantly affects the value of the national currency.
Cash turnover in Russia and its share
In recent years, the volume of cash in our country has grown significantly. How much Specialists talk about almost 40 percent of cash turnover, this is in the structure of the total money turnover. Such an increase in cash turnover at the present stage of the country's development is associated with the economic crisis of recent years, the growth of mutual non-payments, as well as the desire to avoid taxes. In addition, credit institutions have poor control over the implementation of cash circulation standards.
Any mutual settlements on bank accounts make them transparent and allow you to objectively see the processes taking place in the economy.
Actual features of cash turnover
The peculiarities of cash turnover are that it is difficult to take them into account and forecast as accurately as possible. In addition, a considerable amount of foreign currency is in circulation. Dollarization is one of the features of our current economic situation. Frequent fluctuations in the value of the ruble motivate many to save savings in the currencies of other countries.
The forecast of the required mass of cash and the detailing of the procedure for its circulation are assigned in Russia to the Central Bank.
Regulation
Documents of the Central Bank that detail the principles of cash circulation in the country are mandatory for all (regardless of ownership and organization of legal entities) rules for organizing the circulation of cash throughout the country.
The essence of the documents is reduced to the general and mandatory for all principles of cash management:
- All legal entities are obligated to donate revenue and keep money in bank accounts.
- If necessary, they can receive cash where they are constantly served.
- Everyone has a limit on the cash balance at the box office.
- Exceeding the specified amount is not allowed, except in cases where the balance is intended for remuneration.
- Cash flow is monitored centrally, which allows it to be predicted and regulated.
Cash flow structure
The Central Bank in Russia is the only issuing center. Therefore, the entire circulation of money is concentrated there. The structure of cash turnover looks in general terms as follows:
- From the settlement and cash centers (Reserve Fund) of the Central Bank of the country, cash is sent to working cash registers.
- Of these, to the operating cash desks of banks.
- From here, cash is received by enterprises, organizations and the public.
- Money is paid to the population from legal entities' cash registers as remuneration for labor, as well as various allowances and scholarships. It is extremely rare for legal entities to pay in cash to each other.
- In turn, citizens pay money for goods and services to the box office of business entities, and pay taxes and other services to the box office of commercial banks.
- Enterprises and other organizations donate revenue, cash balances (taking into account the limit established by him) to the cash desks of commercial banks.
- The cash balances are also limited by the operating cash desks of commercial banks, which they are obliged to hand over if they are exceeded to cash settlement centers.
- And the RCC surrenders surplus funds.
And so the money cycle in the state takes place. This is the essence of the cash turnover of the national economy.
Planning
In order to balance and optimize the money supply in the state, the Central Bank regularly draws up a forecast cash turnover plan. Such a financial forecast is a tool for calculating the amount of money needed in circulation and, if necessary, its issue.
The forecast is a calculation that is based on the amount of cash receipts from banks and legal entities from the legal entities and population (revenue, deposits, loan repayments, payments, etc.) on the one hand. On the other hand, data is collected from banks on the estimated need for money to pay salaries, pensions, allowances, scholarships, and loans.
Turnover analysis
The forecast data, as well as the actual cash flow figures, are also an important tool for understanding and analyzing the state of the country's economy, income, and the amount of savings that the population makes. In addition, during special crisis moments, such an analysis provides an understanding of the amount of hidden income. And about the shadow turnover of money, tax evasion.
On a quarterly basis, the Central Bank analyzes:
- how fast is the money handling;
- how the consumer price index fluctuates;
- How fully the possibilities of cashless payments are used (between legal entities and individuals);
- collection, cash discipline, target and misuse of cash by legal entities;
- debt (its size and reasons) to the population on wages and other payments.
For the Government, the analysis of cash turnover is a serious help for making a variety of decisions.
Also, planning and analysis allow you to make a timely decision on the need for emissions.
Emission
A large share of the circulation in the form of cash turnover affects the costs of its provision. This includes the costs of storage, transportation of money, their collection, document management, replacement of worn bills. As well as inflation costs to increase the amount of money - emissions.
In periods of economic growth, according to the monetary rule, the mass of rotating funds each year should grow approximately in proportion to the growth of gross domestic product.
Emission may also be required in periods when money is left with people and deposited in the form of savings (not in bank accounts), without participating in the circuit. Thus, a cash shortage arises.
Since the forecast of cash flows is compiled by banks and cash settlement centers on a quarterly and yearly basis, it is actually operational. In cases where it is expected that cash expenditures from all tiers of cash departments will exceed expenditures, the Central Bank plans to issue.
The value of cash flow for the country's economy and the role of the state
In fact, it is cash flow that characterizes to a large extent important indicators of the success of the economy of any country. Indeed, it is in this area that the chain ends: production - the sale of goods and services. Cash turnover reflects the level of consumption in the country and the purchasing power of the population.
The cash flow rate is one of the most sensitive indicators of economic growth success, business activity, attractiveness of the country for investors, and many other economic and financial nuances.
State regulation and control over cash flows is an important tool in a market economy. It allows the Central Bank of Russia, like any other state, to adjust interest rates, determine the cost of borrowed money, timely issue money or withdraw it into reserve funds, and keep the country's economy in balance. Such regulation of cash turnover (including cash as an important part of it) allows you to influence the market environment, maintain stability and balance in all areas of the country's life.