Was the USSR banking system effective?

Karl Marx, who lived in the middle of the XIX century, described the modern banking system as “the most skillful and perfect creation, to which the capitalist mode of production generally leads”. The Soviet banking system was also skillful in its own way and was no less perfect. Though it differed significantly from the banking system of states with a more or less free market.

Features of the Soviet banking system

The banking system of the Soviet Union consisted of territorial and specialized institutions of the State Bank of the USSR, all non-cash payments and payments between them were carried out with the help of interbranch turnover. The movement of means of payment was made by transferring from one account to another under “memorial warrants” (something between a payment order and a payment request) or offsetting mutual requirements (modern clearing).Soviet academician Glushkov developed a project for collecting economic information from across the country and managing the economy of the USSR with the help of computers (cyber economics). But Perestroika prevented this grandiose idea from being realized.
Soviet enterprises and institutions had cash within their own cashier within predetermined limits, and could also use money from proceeds within certain limits annually established by the State Bank of the USSR with the participation of heads of organizations. The size and target direction of the volume of cash from the State Bank or withdrawal of cash from circulation were revised quarterly. When drawing up the cash plans of the State Bank institutions, they were obliged to carefully analyze the results of implementing the plan and, based on this analysis, develop proposals to ensure the right balance between incomes and expenditures of the population, to reduce the output of new money or increase the amount withdrawn from circulation.
Sberbank (then fully state-owned bank) worked directly with the population, being perhaps the most reliable in the world, since all operations and safety of deposits were guaranteed by the Soviet state.
These and other features would mean that the rate of inflation in the Soviet Union was extremely low. And in practice it turned out really so. In addition (and even under the strict supervision of the Soviet internal affairs agencies), such a scheme practically excluded the introduction (or the possibility of even a short existence) of at least some crime in the banking sector.
The considered feature also provided a high stability and a fairly efficient distribution of funds across sectors of the economy.


The disadvantages of the banking system of the USSR include the fact that the effectiveness of its work depended directly on the effectiveness of the Soviet leaders who ruled the country. Under Lenin, Stalin, Brezhnev, Andropov, she worked best.
In general, the Soviet banking system can be called quite effective. It should also be noted that it helped to achieve the goal of a planned economy, not a market economy. Because coping with the imputed tasks very well. The banking system was very reliable, both financially and economically. Its security against the introduction of criminal elements was also at its best.Analogues of such a Soviet banking system does not exist to this day. However, if it is reanimated, then nothing will remain of the market economy and financial markets in our country. Good or bad - the topic is already a separate article.

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