Russians rush to withdraw bank savings amid fears of a deposit freeze
Cash in circulation in Russia has surged this year as citizens, fearing a possible deposit freeze, pull money out of banks. Experts say such a freeze remains unlikely for now, even as liquidity problems mount for banks.
Rumors about a possible freeze on bank deposits have unsettled Russians in recent weeks, a scenario recently highlighted by The Washington Post and linked to the fast-growing volume of cash in circulation. Russians have been withdrawing savings from banks since the fall of 2024, but the trend accelerated sharply in 2026.
Since the start of the year, cash in circulation has grown by more than 10%, or 2.8 trillion rubles, and could reach a 3.8 trillion increase by year's end — more than half of Moscow's annual budget, Sber Chief Financial Officer Taras Skvortsov told RBC. He called July the worst month for bank outflows in six years.
A liquidity squeeze
The cash outflow has created a more pressing problem: banks' liquidity shortage has more than quadrupled since the start of 2026, from 0.6 trillion to 2.6 trillion rubles. That leaves banks with less capacity to issue loans and buy government debt, which matters greatly as Russia's budget deficit grows.
Economists warn that fewer deposits mean less lending capacity. Sber's Skvortsov described the situation as roughly a million mortgage loans the banking system won't be able to issue this year.
Is a freeze coming?
Most economists interviewed consider a deposit freeze unlikely. Central Bank Deputy Chairman Alexey Zabotkin said in July that a freeze was impossible under any scenario, while other analysts note the authorities are instead addressing budget strains by pumping more money into the economy rather than resorting to such a drastic measure.
Still, experts caution that if the war continues, living standards in Russia will keep declining slowly but steadily over time.
