Selection of Saving Currency in the Palestinian Banking System

11 Pages Posted: 13 Apr 2012

See all articles by Nidal Rashid Sabri

Nidal Rashid Sabri

Birzeit University

Diama Khaled Abu Laban

Birzeit University

Dima Hanyia

Birzeit University - College of Economics

Date Written: April 12, 2012

Abstract

The Palestinian economy belongs to emerging economies with GDP of 6.5 billion USD. It has unique conditions as a service economy, with a significant role in public sector contribution, including the Palestinian National Authority budget, the UNRWA budget and many NGOs financed by international aids.. Finally, the most unique aspect of this economy, is that it has no national currency, but three official currencies are in use instead, including JD, US$, and NIS. Therefore this research aims to examine how clients move from one currency to another in case of saving, and conducting business transactions. The study used multi research instruments including: analyzing the related data to examine the relationship between changes in the value of banking deposits of each of the used currencies and their respected interest rates, also using quarterly data analysis for the last ten years. In addition, structured interviews and relevant questionnaires were articulated and conducted to selected samples of bankers and banks’ clients from 12 banks. The study found that the interest rate is not a critical factor in selecting a currency for savings and deposits in banks, as reported by the clients and banking staff, as well as found by the financial analysis, which shows week or no correlation between changes in interest rates and changes in values of deposits in banks.

Keywords: saving currency selection, saving habits, multi-currency system

JEL Classification: E51, G21, F32

Suggested Citation

Sabri, Nidal Rashid and Abu Laban, Diama Khaled and Hanyia, Dima, Selection of Saving Currency in the Palestinian Banking System (April 12, 2012). Available at SSRN: https://ssrn.com/abstract=2038729 or http://dx.doi.org/10.2139/ssrn.2038729

Nidal Rashid Sabri (Contact Author)

Birzeit University ( email )

Birzeit, West Bank
Palestine
972 2 2810396 (Phone)
972 2 2982963 (Fax)

HOME PAGE: http://home.birzeit.edu/commerce/sabri

Diama Khaled Abu Laban

Birzeit University ( email )

birzeit
Palestine

Dima Hanyia

Birzeit University - College of Economics ( email )

birzeit
Palestine

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
1,226
Abstract Views
1,707
rank
16,932
PlumX Metrics