Money circulation
Currency circulation system
Cash remains the primary means of payment for everyday purchases of goods and services in the Republic of Armenia. There is a centralized (traditional) model of currency circulation coordination in the Republic of Armenia, under which the Central Bank participates in all stages of currency management.
The main players in the cash circulation system of the Republic of Armenia are the Central Bank of Armenia, 18 commercial banks (with about 550 branches), and six cash collection companies.
The role of the Central Bank in currency circulation
Following Article 5 of the Law of the Republic of Armenia on the Central Bank of the Republic of Armenia, the responsibilities of the Central Bank include issuing the currency of the Republic of Armenia, as well as organizing and regulating money circulation.
The Central Bank of Armenia undertakes various functions to accomplish its tasks. Specifically, it regulates the legal framework for currency circulation, oversees the production of banknotes and coins, safeguards cash in dedicated vaults, introduces it into circulation, and withdraws from circulation the currency issued by the Central Bank. Additionally, the Central Bank provides cash services for commercial banks and ensures the appropriate quality of currency in circulation.
The role of banks in currency circulation?
The Central Bank of Armenia’s cash services for commercial banks are carried out through the banks’ cash centers.
Commercial banks act as intermediaries in the organization of currency circulation and perform the following functions:
- Form sufficient reserves of cash to meet customer demand
- Through the provision of cash services to customers, provide cash to the economy, and withdraw cash from circulation
- Reprocess cash received (registered) from customers and other functions
The movement of cash in the Republic of Armenia's banking system is carried out by cash collection companies.
Our goals for currency circulation development?
The primary task of the currency circulation system of the Republic of Armenia is to satisfy all demands for cash arising among economic entities. The main objectives of the Central Bank of Armenia for the improvement of the currency circulation system are the following:
- Ensuring continuity of currency circulation
- Ensuring currency circulation with proper-quality currency
- Security
Commemorative coins
In addition to issuing banknotes and coins intended for circulation, the Central Bank of Armenia issues commemorative coins. Commemorative coins are available for purchase at the Central Bank of Armenia’s Numismatist shop.
How are damaged banknotes exchanged?
Citizens can exchange worn or damaged currency for circulation-quality currency free of charge. Citizens can exchange worn or damaged currency both at commercial banks and at the external cash desk of the Central Bank of Armenia. Suspect currency is subjected to appropriate examination at the Central Bank.