The FINANCIAL — The majority of Georgian depositors, 59%, are saving money for unforeseen expenses, a new survey by The FINANCIAL has revealed.
The FINANCIAL — The majority of Georgian depositors, 59%, are saving money for unforeseen expenses, a new survey by The FINANCIAL has revealed. The enquiry of over 300 depositors showed that over 11% are saving up for a new apartment, 10% for a new car and the same number for vacations and other luxury items. The average age of Georgian depositors is from 40 to 50. The majority (65%) are women.
Women are also dominant among the depositors of ProCredit Bank Georgia. Thirty-eight percent of the Bank’s depositors are women, 36% men and 26% non-applicable legal entities. The total number of depositors at ProCredit Bank Georgia is 235,092, the total amount in consumer accounts is GEL 525,473,020. Currently the Bank occupies 6.47% of the Georgian deposits market.
“Saving money is a form of self-discipline for me,” said Nino Makharadze, 56, to The FINANCIAL. We met her as she was leaving a Georgian bank branch. “Saving money is the surest path you can follow if you want to minimize financial problems, both today and in the future. Even very small children can be taught not to spend every penny as soon as they get it, but to put some of their money in to a piggy bank so that it will be there when they want or need it. ‘A penny saved is a penny earned’ is still a valuable lesson,” said Makharadze.
Makharadze thinks that most young Georgian people are not taught the importance of saving. “Their families may not have the motivation and self-discipline to plan for spending and saving. Parents may lack the knowledge and shopping skills needed to spend less and save more. They may be vulnerable to the tactics used in advertising and store displays that tempt them to buy things they do not need—using money that they could have saved, money they will want or need for something else tomorrow,” she added.
It took Makharadze time for her trust in banks to be restored sufficiently for her to start saving up her money there again. “The banking history of the ‘90s instilled in the public a sense of distrust in the banking sector. “Today I have no doubts in the sector and as I am getting nearer to the age of retirement I know the importance of saving up a cushion of money,” she said.
The largest share of depositors at Georgian banks is made up by residents of Tbilisi. At ProCredit Bank Georgia they make up 70.89% of the total deposit portfolio. Tbilisi is followed by Batumi, with 12.69% and Kutaisi with 4.03%. A significant number of Rustavi, Gori, Poti, Zugdidi and Telavi residents also deposit their money in banks. The above-mentioned five Georgian cities make up more than 1% of the deposit portfolio at ProCredit Bank Georgia. The rest of the country’s residents make up less than 1%.
According to National Bank of Georgia, as of December 2012 commercial banks deposits belonging to legal entities and individuals in the national currency amount to GEL 2,707,203 thousand while in December 2011 the total deposit portfolio amounted to GEL 2,578,936 thousand. As for foreign currency, the volume of deposits as of December 2012 is GEL 5,171,011 thousand whereas in December 2011 it was GEL 4,043,590 thousand. As of the end of 2012, the amount of national currency in circulation amounts to GEL 1,918,059 thousand, while foreign exchange amounts to GEL 4,392,996 thousand.