Russians turn to cash, putting more strain on slowing wartime economy

Russians turn to cash, putting more strain on slowing wartime economyImage source, Anadolu via Getty ImagesImage caption, There have been several surges in cash withdrawals as Russians seek a buffer against uncertaintyByEvgeny Pudovkin and Daria Mosolova, BBC MonitoringPublished5 minutes agoRussians are returning to cash, as mobile internet shutdowns disrupt card payments, and more businesses seek to dodge tax under mounting financial pressure more than four years into the war with Ukraine.Russia has added 1.56tn roubles (£14.8bn; $20bn) in cash into circulation since the start of the year - the biggest rise for the equivalent period in any year outside the Covid-19 pandemic, according to Central Bank figures analysed by the BBC.The spike comes amid a wave of Ukrainian drone attacks, which have repeatedly led the Kremlin to shut down mobile internet across large swathes of the country, leaving many unable to pay by card. The government says the aim of the shutdowns is to counter the drone strikes."Having cash on hand gives you some sense of control and security," one woman in Moscow told the BBC on condition of anonymity. "If there's an emergency in the city, I know I'll still be able to buy basic necessities, even if the mobile network goes down."The latest increase follows several earlier wartime surges in cash withdrawals as Russians have sought a buffer against uncertainty. Cash in circulation jumped after President Vladimir Putin announced a partial mobilisation in September 2022 and during a brief mutiny by the Wagner mercenary group in June 2023.Now, the shift is making it harder for the state to collect tax, just as it faces a widening budget deficit and needs every rouble it can raise to fund the war in Ukraine.Although Russia's oil and gas sector, which accounts for about a quarter of state revenues, has benefited from a recent rise in oil prices following the Iran war, the broader economy is slowing. In May, the Russian...