Damaged Turkish banknotes in Idlib; Who guarantees its value

Damaged Turkish currency in Idlib - October 2022 (Enab Baladi/Anas al-Khouli)

Damaged Turkish currency in Idlib - October 2022 (Enab Baladi/Anas al-Khouli)


Enab Baladi – Anas al-Khouli

Khaled al-Subhi, 51, a bus driver that transports passengers between the cities of Idlib and Azaz in northwestern Syria, complains about the worn-out banknotes that customers give him in return for boarding the bus.

The damage of the approved Turkish currency banknotes circulating in the city might reach a point where merchants and gas stations refuse to accept and deal with them. This is what al-Subhi told Enab Baladi, explaining that he does not pay attention to the quality of the banknotes he collects from his passengers while he is busy driving.

According to the driver, most of the damaged banknotes are in denominations of 100 or 50 Turkish liras, an amount he considered “large,” noting that some sellers refuse to deal with them and take them or require that their value be reduced in order to accept them.

According to what Enab Baladi observed, the issue of deteriorating and old banknotes in Idlib is not limited to the Turkish currency but also includes the US dollar.

Mazen al-Saeed (35), a day laborer displaced person who resides in Idlib, told Enab Baladi that there was a difference between the damage of Turkish currency and that of the US dollar. Turkish banknotes remain tradable until the damage reaches a high ratio, while the dollar loses a portion of its value despite the simple damage rate that may be inflicted on the banknote.

Damage above normal limits

The Deputy Director of the Licensing Department at the General Monetary Agency for Cash Management in the Syrian Salvation Government (SSG), Ali Thalji, said in a statement to Enab Baladi that it was normal for banknotes, especially small denominations, to be damaged due to being largely circulated.

Thalji confirmed that the phenomenon of damaged banknotes in northern Syria was considerably exacerbated while noticing traces of grease and oil on banknotes. When comparing the proportion of damage to the size of the cash mass traded in northern Syria, the damage rate was well above the acceptable limit resulting from the normal use of paper currencies.

Thalji considered that the soaring damage rate was evidence of “gross negligence in maintaining banknotes integrity,” noting that damage and the frequent replacement of currency had resulted in the loss of part of its value as the damage was due to gross negligence or deliberate damage.

The General Monetary Agency for Cash Management in Idlib, northwest Syria, first appeared in public on 11 May 2017, after Hayat Tahrir al-Sham (HTS) announced the establishment of the General Monetary Agency for Cash Management and Consumer Protection, with the aim of regulating exchange operations and preventing monopoly and manipulation of currency rates.

The agency is concerned with managing the movement of cash within the “liberated areas” and is responsible for following up on the work of exchange companies and money transfers and for granting licenses to all exchange companies and money transfers in those areas.

Five factors exacerbating the banknotes damage in Idlib

The economic researcher at the Omran Center for Strategic Studies, Mohammad al-Abdullah, told Enab Baladi that the damage and deterioration of Turkish paper currencies in Turkish spheres of influence, in general, has become a common phenomenon but is further exacerbated in the Idlib region for several factors:

1-The absence of a Turkish government-affiliated financial institution authorized to withdraw the damaged banknotes from circulation and replace them with new ones, which is done by the Turkish Post and Shipping Corporation (PTT) divisions outside Idlib, while the process of pumping Turkish currency notes into Idlib is carried out through Al-Sham Bank, in coordination with the Turkish side through a group of intermediaries, and its role does not go beyond this task. The bank is originally an expanding exchange company with a bank designation and does not provide all the banking products and services recognized for individuals, especially in the banking sector.

2-The absence of a central authority for cash management to establish accurate and up-to-date statistics on the volume of the Turkish lira cash mass circulating and the number of denominations present therein and to determine the necessary volume of such mass, which will have negative implications for the quantity, adequacy, and speed of damage of the paper circulating. Although there is a so-called General Monetary Agency for Cash Management, it has not lived up to this task, while its core activity is in controlling the banking and remittance market.

3-Individuals’ culture in the local community that perpetuates keeping banknotes in their possession, even in the presence of automated teller machines (ATMs). This is clearly evident in the Euphrates Shield areas, in which the PTT divisions witness a great crowding at the beginning of each month by employees to withdraw their salaries as soon as they are wired to their accounts in these divisions to keep cash in their possession, which leads to rapid deterioration. It would be no different in Idlib, even if ATMs were installed there.

4-The money pumped into Idlib through Al-Sham Bank is in tradable condition, but the speed of its circulation between individuals and its personal retention quickly damages it, in addition to not withdrawing it before it reaches a stage of complete deterioration. The central bank usually withdraws and replaces the banknotes before they reach such a stage.

5-The absence of an entity to which individuals can turn to replace their damaged banknotes furthers this problem.

Damaged Turkish currency in Idlib - October 2022 (Enab Baladi/Anas al-Khouli)

Damaged Turkish currency in Idlib – October 2022 (Enab Baladi/Anas al-Khouli)

Proposals to solve the problem

Abdullah Jumaa, 45, an Idlib-based accountant, told Enab Baladi that replacing damaged banknotes is cumbersome and costs governments huge sums of money, which is why governments usually tend to solve these problems in more than one way, including the deployment of modern automated teller machines and dealing with bank cards instead of using cash, or at least partially using paper currencies. A citizen holds a bank card and withdraws money on a daily basis depending on their need, and only has to carry money in their pocket as much as necessary.

The accountant added that the infrastructure and the war conditions prevent the complete dealing with bank cards instead of paper currencies. However, it is possible to resolve the problem partially through the placement of ATMs, such as in the cities of Afrin and Azaz.

On his part, Ali Thalji, an official at the SSG’s General Monetary Agency, said that the agency is working to solve the problem of damaged banknotes by adopting awareness programs for citizens to publicize the importance of maintaining the integrity of banknotes. It is also launching an e-payment application that eliminates the use of paper currencies without mentioning the exact timing of its launch.

In 2018, Hayat Tahrir al-Sham (HTS) turned Al-Waseet (its own money transfer company in Idlib) into Al-Sham Bank, formerly the Industrial Bank.

The branches of the PTT Company, which is considered a Turkish bank in northern Syria, are located in 11 towns in the countryside of Aleppo that is held by the Syrian Interim Government (SIG). There are no branches in SSG-held areas.

PTT centers provide the possibility of opening personal bank accounts in which citizens can deposit their money or withdraw the deposited amounts at any time. Through it, employees’ pensions are handed over, as employees in those areas, including teachers, police, council employees, doctors, and khatibs, were given bank cards to withdraw their salaries, in addition to remittances and external shipping services.

Demands for ATMs

In an opinion poll conducted by Enab Baladi on damaged banknotes in Idlib and proposed solutions, citizens demanded ATMs such as those in Afrin and Azaz because of their positives when it comes to currency trading.

Ibrahim Seifou (44), an Idlib-based merchant, considered that ATMs solve several currency trading problems, including that citizens do not have to carry large amounts of money while on the move and the ability to withdraw the required amount at any time and place. It also solves many of the problems that merchants face by adopting cash transfers instead of paying in cash, which removes some of the problems that they face.

ATMs also provide more security rather than keeping money at home, exposing it to theft or loss. If the ATM card is lost or stolen, it can be blocked and replaced immediately, Seifou said.

When the General Monetary Agency of the Syrian Salvation Government (SSG) was asked about the possibility of setting up automated ATMs in the area, Ali Thalji said that the subject was still under consideration and that steps might be taken in that direction in the coming days.

Legitimacy is one of the obstacles

For his part, the economic researcher, Mohammad al-Abdullah, believes that the placement of PTT-affiliated ATMs in the region, as is the case in the countryside of Aleppo, is essentially linked to Turkey’s avoidance of providing financial services through one of its government institutions in an area classified as managed by HTS, which is classified on the international and Turkish terrorist lists, for fear of international sanctions against this institution and damaging its reputation as one of Turkey’s oldest governmental institutions.

Because of this, al-Abdullah added, the SSG is trying to show itself as a government entity capable of controlling and regulating the financial sector with the tools at its disposal.

Al-Abdullah explained that it is not simple to start establishing SSG-affiliated banks in light of the circumstances and challenges it is facing to gain international legitimacy.

It is not so much about the financial and technical cost of installing these ATMs, as it is related to the ability of established banks to ensure that they would be recognized in domestic and international surroundings, as well as the unstable security environment that also hampers the implementation of this step, according to the economic researcher.

The replacement of the Syrian currency with the Turkish one in northern Syria came after the exchange rate of the Syrian pound reached the limit of 3500 SYP per dollar in June 2020, amid demands from Syrians that the replacement be a temporary solution until a political solution is reached. 


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