The best way to store money: in a bank or in cash

Cashless payments are rapidly developing in Kazakhstan, but cash remains relevant. According to the National Bank of Kazakhstan, the amount of cash in circulation reached 4.5 trillion tenge at the end of August 2024, while over 22 trillion tenge are held in bank deposits. Under these circumstances, many are concerned about the best way to store money: keeping it safe in cash or entrusting it to a bank (on a card or savings account)? Let's consider the pros and cons of each option, taking into account Kazakhstani statistics and current realities.

Storing money in cash: pros and cons

Storing money in cash is the simplest and most common way to save money. While it offers certain advantages, it also comes with serious drawbacks.

Pros of cash

• Availability and instant payment. Cash can be used almost anywhere and instantly – no devices or internet connection required. In remote areas or during electronic outages, physical cash will always be available.

• Independence from the banking system. Your own money is always at hand, unaffected by bank freezes and technical issues in the banking network. In an emergency, cash is available immediately, without waiting.

• Anonymity and control. Cash payments leave no digital trace, preserving privacy. Furthermore, many people are psychologically more cautious about spending cash – seeing actual bills makes it harder to part with large sums, reducing impulsive spending.

• No storage fees. Keeping money "under the mattress" costs nothing: there are no bank fees for account maintenance or withdrawals. You don't have to pay for the convenience of storage – although these savings may be offset by other factors, discussed below.

Cons of cash

The main drawbacks of cash are depreciation and the lack of income. Money kept "under the pillow" doesn't earn interest, and its purchasing power declines over time due to inflation. For example, in August 2025, annual inflation in Kazakhstan was 12.2%, which means, by keeping a large sum at home, you risk losing a double-digit share of its real value annually. Cash doesn't generate income and isn't protected from economic factors.

Furthermore, physical money is vulnerable to loss. It can be stolen by criminals or simply gone in a fire, a lost wallet and other similar situations — and unlike a bank account, recovering lost bills is almost impossible. Safely storing large sums at home is extremely difficult: cash requires a secure safe and secrecy, but even then, it's not guaranteed. The risk of theft or damage remains very high.

Finally, relying solely on cash limits the possibilities of modern financial transactions. Cash can't be used to pay for online purchases directly or make instant remote transfers — to do so, you first have to deposit the money into an account. Any financial transaction at a distance will become a lengthy process. Moreover, when paying with cash, there's a risk of receiving counterfeit bills or being short-changed without the ability to quickly prove it. These drawbacks make keeping all your savings in cash a downright risky and inconvenient solution.

Storing money on bank cards: advantages and disadvantages

Bank cards and linked accounts are now an alternative to cash. Salary projects, smartphone payments, and money transfers are now possible thanks to the widespread use of card products. Let's consider the benefits (and risks) of storing money on a card.

Advantages of bank cards

• Convenience and speed of payments. You can pay for a purchase with a card in seconds – just tap it on the terminal or enter your details online. No need to carry wads of bills or worry about change. Cashless payments save time in stores and services.

• Security of funds. The risk of theft is significantly lower: you don't carry large amounts of cash, and transactions are protected by PIN codes and other security measures. If your card is lost, it can be quickly blocked by the bank, preventing unauthorized withdrawals. This minimizes the risk of losing all your funds due to robbery or wallet loss.

• Bonuses and benefits from the bank. Many banks encourage customers to use their cards by offering cashback or bonus points on purchases. By paying with a card, customers avoid the need to search for a favorable exchange rate – the bank automatically applies its own rate, which is usually comparable to the retail rate.

• Wide range of opportunities. A bank card opens access to a variety of services: you can instantly transfer money to other cities and countries, pay utilities and taxes online, set up automatic payments without late payments, and much more. Certain products allow you to go into a small overdraft or use a credit limit if your own funds are temporarily insufficient. All transactions are immediately displayed in the mobile app, making it easier to manage your budget and plan your finances.

Disadvantages of bank cards

Despite the obvious advantages, bank cards also have certain drawbacks. First, using a card is entirely dependent on the technical infrastructure. If the payment terminal, network, or ATM is temporarily down, you will be unable to make payments or withdraw cash. Sometimes, the bank blocks the card, for example, upon expiration or if fraudulent transactions are suspected. In such situations, accessing your funds may be difficult until the issue is resolved.

Second, the convenience of cashless transactions comes at the cost of fees and limits. Banks often charge fees for card account maintenance, transfers, or cash withdrawals over a certain limit. There are also limits on one-time or daily withdrawal amounts. If you use a credit card or overdraft, late repayments incur a debt with interest, which is another disadvantage of cashless transactions.

Furthermore, the risk of fraud remains. Criminals can obtain your card details through phishing or skimming, putting you at risk of losing your account funds. Banks are constantly improving security, but the human factor remains — recovering stolen money from a card isn't always quick and easy. Finally, card payments can lead to overspending: psychologically, electronic transactions are less noticeable, and amounts are debited unnoticed, leading to overspending and debt. A limited credit limit can exacerbate this problem. Furthermore, completely eliminating cash is still difficult — card payments aren't available everywhere (for instance, some markets and small stores only accept cash, and simple electronic malfunctions are also common). Therefore, keeping money on a card requires discipline in spending and reliance on the smooth operation of the banking system.

Keeping money in a savings account: pros and cons

A separate option is a bank deposit (savings account) — placing money in a bank to preserve and grow capital. Many Kazakhstani citizens choose this method, entrusting their savings to the bank for interest. Let's take a look at the advantages and disadvantages of this approach.

The main benefit of a deposit is the interest income it generates. The bank pays interest on the remaining balance, so your savings grow over time. In Kazakhstan, tenge deposit rates are currently quite high: for example, with inflation at around 12% per annum, banks offer 15-18% on deposits, providing depositors with a positive real return. Thus, a deposit allows you to at least partially protect your money from depreciation. It is no coincidence that tenge deposits are considered one of the most effective ways to save money — according to surveys, over 38% of Kazakhstanis consider it profitable (on par with real estate investments).

Reliability and protection – by keeping your money in a bank, you eliminate many everyday risks. Your account funds won't be stolen from your apartment or consumed by fire – the bank's infrastructure physically protects your money. Moreover, deposits are insured by the state: the Kazakhstan Deposit Insurance Fund will return the deposited amount (along with accrued interest) to the depositor if the bank's license is revoked. Insurance coverage is up to 10 million tenge for non-term and term deposits in tenge and up to 20 million tenge for savings (accumulation) deposits, meaning that most savings in the national currency are fully protected. The limit is lower for foreign currency accounts, but foreign currency deposits are less popular. As a result, small and medium-sized savings are virtually completely protected from bank bankruptcy, increasing public confidence in depositing.

Financial discipline and convenience – a savings account is convenient because it separates your savings from your everyday money. This reduces the temptation to accidentally spend your savings. You create a safety net that doesn't sit idle at home, but works for you. Modern banking offers a variety of deposit types for different purposes: from highly profitable savings accounts (with high rates but limited withdrawals) to flexible, non-term accounts that allow withdrawals at any time without losing interest. You can choose the balance between availability and income level. In an emergency, you can withdraw funds early – often with a partial loss of accrued interest, but this option remains available. Thus, a savings deposit, when chosen wisely, provides both income and a certain degree of liquidity, especially if you set aside a reserve for unforeseen needs.

Disadvantages of keeping money in a savings account

No financial instrument is perfect, and bank deposits have their drawbacks as well. The first is limited liquidity. By depositing funds, you essentially sacrifice easy access to your money for additional interest. If your savings are "locked in" for a certain period, they can't be accessed at any time without incurring financial losses. Of course, you can always withdraw your money early, but then the bank will recalculate the interest at the minimum rate (and often simply won't pay it), and you'll lose income. Therefore, the capital in a deposit can't be considered completely free funds; it's more of a reserve that must be managed according to the bank's rules.

The second drawback is the relatively low return. Yes, the interest on a deposit usually covers inflation, but it doesn't significantly exceed it. A deposit is the lowest-risk financial instrument, and low risk means limited returns. Experts emphasize that the interest rate on deposits is low precisely because the risk of loss is close to zero. You can't expect to get rich from bank interest alone. Moreover, in unfavorable years, interest rates don't always keep pace with inflation — especially on foreign currency deposits, where rates are minimal. During prolonged periods of high inflation or income taxes (in Kazakhstan, there is currently no personal income tax on deposits in national banks, but in other countries, there is), the real value of savings in the account may even decrease. Simply put, a deposit preserves savings and generates a small return, but doesn't significantly increase capital.

Another factor is currency risk. Banks pay the highest interest rates on tenge deposits, while returns on foreign currency accounts are significantly lower. This encourages most depositors to keep their savings in national currency. However, if the tenge suddenly depreciates, the benefit from the higher local interest rate can quickly vanish. This means that your deposit will lose value when converted into dollars or euros. However, the National Bank notes that trust in tenge deposits has increased in recent years: the dollarization rate of household deposits has fallen to a record low of ~22–25%, and the high interest rate and the tenge's guarantee make this a rational choice. Nevertheless, keeping all savings in one currency is always a risk; it makes sense to diversify savings whenever possible (for example, keeping some in tenge and some in foreign currency).

Finally, a deposit requires trust in the bank and the stability of the financial system. Despite deposit insurance, Kazakhstan has had bank closures, and refund procedures have taken time. It's important to carefully select a reputable bank and carefully review all terms of the agreement (especially regarding early withdrawal and interest rate adjustments). If these conditions are met, a savings account remains one of the most reliable savings options, though not entirely free of risks or limitations.

Other options for storing money

Beyond cash, bank cards, and deposits, there are alternative ways to save and grow capital. Traditionally, Kazakhstanis value investments in tangible assets such as real estate and precious metals. According to surveys, real estate and tenge bank deposits are considered the most profitable investment instruments (approximately 38% of respondents each), while gold is the third most popular (~25.5%). However, in practice, not everyone has the capital to utilize these options: only 7.5% of respondents actually had savings in real estate, and 7.1% in gold. Real estate requires significant funds and is characterized by low liquidity (it's not easy to sell an apartment quickly if needed), while gold must be stored securely and purchased wisely to avoid losses due to price fluctuations. Therefore, investing in real assets is more suitable for long-term and partial placement.

A popular way to save money is to convert savings into foreign currency. Many Kazakhstanis keep a portion of their savings in foreign currency, primarily US dollars, to mitigate the risk of tenge depreciation. According to surveys, approximately 30% of citizens with savings keep them in foreign currency (most often US dollars). This can be done in cash (dollars are often kept at home instead of tenge bills) or in a foreign currency bank account. However, foreign currency does not generate income as such (interest on dollar deposits is minimal), and domestic transactions are difficult. Nevertheless, to hedge against long-term devaluations, the population continues to purchase foreign currency, especially during periods of economic uncertainty.

Digital assets, or cryptocurrency, have emerged as a new alternative. They offer the promise of high returns, but are also highly volatile. In Kazakhstan, most citizens remain wary of cryptocurrencies: according to a study, only 3.7% of respondents indicated that they store some of their savings in crypto assets, and overall, cryptocurrency was considered the least reliable way to store money. The lack of guarantees and regulation, coupled with strong exchange rate fluctuations, makes cryptocurrencies a rather risky savings tool. Therefore, investing in them should only be done with a very limited amount and with an understanding of the potential for losses.

On the other hand, interest in investing in securities is growing. Purchasing government bonds, shares of large companies, and mutual funds are all options that can yield higher returns than bank deposits, if approached wisely. It's no coincidence that the number of brokerage accounts in Kazakhstan has already exceeded 3.5 million by early 2025, as more and more people are trying their hand at the stock market. Such investments not only preserve but also grow capital, but they require financial literacy and risk tolerance. For beginning investors, the optimal strategy may be a combination of keeping the bulk of your savings in reliable instruments (deposits, bonds) and investing a smaller portion in higher-yielding but volatile assets. In any case, diversification (separating your funds into different types of investments) increases the overall security of your finances.

How Kazakhstani citizens choose deposits: results of a survey on savings and finances

The National Bank of Kazakhstan regularly studies the savings behavior of the population. According to surveys conducted in 2024–2025, the majority of Kazakhstanis have no savings at all. In August 2025, approximately 67% of respondents admitted to having no savings. Only approximately 25–33% of the population manages to save money, and this share is gradually increasing. By comparison, in 2022, less than 20% of people had any savings, and the highest level in recent years (35%) was recorded in October 2024. Improving well-being and financial literacy are slowly increasing the number of those who save, but approximately two-thirds of citizens still live without a financial cushion.

Among those who manage to save, bank deposits are the most popular. According to a National Bank survey, about 65.8% of all respondents with savings prefer to keep them in bank accounts. According to other data, this share fluctuates between 63–66% depending on the month. This means that approximately two-thirds of depositors trust their banks. Second in popularity is keeping cash at home, chosen by approximately 30-37% of respondents at various times. In other words, almost one in three prefers to keep some of their savings "on hand." Significantly fewer people use alternative methods: approximately 15-20% invest in real estate, and only about 6-8% in securities or other assets. These figures echo market data: household bank deposits reached record levels — over 22 trillion tenge at the beginning of 2025, while cash outside the banking sector stands at approximately 4-5 trillion tenge.

The currency structure of citizens' savings is also interesting. The majority of savings are held in tenge: an estimated 84-92% of respondents have savings in the national currency. However, approximately 29-30% of respondents indicated that they keep some funds in US dollars. (Obviously, many of them split their savings between tenge and foreign currency accounts, or keep dollars in cash in case of devaluation.) The share of those saving in euros or rubles is much smaller – ~5% each. The predominance of tenge is explained by the fact that deposits in the national currency offer higher rates and are more insured by the state than foreign currency deposits, which significantly strengthens public confidence in tenge deposits. In recent years, thanks to measures taken by the National Bank, deposit dollarization has fallen to a historic low (~22% as of early 2025), and the tenge is once again perceived as a relatively reliable currency for savings. Nevertheless, many Kazakhstanis continue to use a combination of currencies for their savings to reduce risks.

Which one is better: cash or a card?

So, which is better – cash or non-cash? There's no definitive answer: much depends on the situation, the amount, and your goals. For everyday expenses and medium-sized amounts, a bank card is significantly more convenient and secure. It offers fast payments, PIN code protection, remote payment options, and various bonuses. It's no coincidence that experts note that a modern card is far superior to cash in terms of convenience, security, and benefits. On the other hand, you shouldn't completely abandon cash – it has its own indispensable niche. The optimal approach is to combine both: keep your main balance on your card (or in a bank account) and have a small cash reserve for unforeseen circumstances. Cash will come in handy if electronic payments are temporarily unavailable or if a particular location doesn't accept cards, and the rest of the time, let your money work for you within the banking system.

Therefore, it's best to diversify your savings. For long-term savings, it's wise to use reliable banks and deposit accounts – savings are safe there and can even generate income. For immediate needs and expenses, it's more convenient to keep funds on a bank card, taking advantage of all the benefits of cashless payments. Cash should be saved in reasonable amounts for emergencies when it's absolutely necessary. This balanced approach will allow you to both preserve your capital and feel confident in any situation.

A reliable financial infrastructure also plays a crucial role. Paygate serves as a technology partner in payment automation for e-commerce and mobile network operators, supporting the growth of secure, convenient cashless transactions in Kazakhstan for many years. With partners like these, digital finance becomes more accessible and reliable for everyone, and you can be confident that your money is being stored and used most efficiently.