The rapid increase in cash circulation in Morocco is raising concerns about its effects on the economy. In May 2024, the money supply grew by 4.3%, mainly due to a 10.2% rise in physical currency. This phenomenon is linked to various factors, such as subsidies and deposit withdrawals during the Covid-19 pandemic.
The Wali of Bank Al-Maghrib (BAM), Abdellatif Jouahri, noted that cash accounts for about 30% of GDP, one of the highest rates globally, thereby facilitating money laundering and terrorism financing. The introduction of the digital currency, e-dirham, could help reduce cash circulation.
Economic analyst Zakaria Garti explains that this trend continues due to tourists using cash and transfers from Moroccans living abroad. About 70% of physical currency is hoarded, depriving the economy of financing.
To combat this increase, Garti and economist Omar Bakkou recommend enhancing financial inclusion and mobile banking, as well as improving business transparency and financial education.
