In Turkey, the practice of storing wealth as physical gold outside the formal banking system—a tradition known locally as “yastık altı” or “gold under the mattress”—has become a significant concern for policymakers and economists seeking to strengthen the nation’s financial infrastructure.
The custom of hoarding gold is deeply rooted in Turkish culture and history. Gold is traditionally gifted at major life milestones, particularly at weddings, where it historically served as financial security for wives who did not work outside the home. Today, Turkish households are estimated to store approximately 5,000 tons of gold, with a current value around $600 billion according to the Turkish Central Bank. Many Turks view physical gold as a more reliable store of value than bank deposits, particularly given the country’s persistently high inflation rate, which hovers near 31% annually—among the world’s highest.
Economists and government officials acknowledge that this behavior, while seemingly irrational, reflects logical responses to documented economic instability. Turkey has experienced multiple banking crises, chronic high inflation, and repeated currency devaluation. A survey by an economist at Istanbul’s Koç University found that nearly 40% of respondents rated their trust in commercial banks near zero on a scale of zero to ten, with trust in the statistical agency even lower at over 50% giving near-zero ratings.
The Turkish Finance Ministry has indicated that approximately $640 billion in gold and foreign currency is held outside the formal financial system. Officials argue this practice diverts capital from productive economic investment and weakens the nation’s ability to manage monetary policy effectively. However, for ordinary Turks facing daily cost increases and currency weakness, physical gold continues to offer stability and protection that traditional banking institutions have failed to provide reliably.
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