The monetary issue in developing and emerging economies extends far beyond mechanical considerations regarding the volume of money supply or short-term nominal exchange rate fluctuations. It strikes at the core of institutional architecture, economic agents’ confidence, and the macroeconomic levers of development. In the Democratic Republic of Congo (DRC), an in-depth diagnosis of monetary dynamics reveals a major structural pathology: the severe atrophy of the national currency in its store-of-value function, materialized by the near-total dollarization of bank savings ([23]; [35]).

In a monetary system where confidence has been historically eroded by episodes of hyperinflation, recurring currency depreciation, and poorly conceived reforms ([25]), the Congolese Franc (CDF) has been progressively relegated to the minimum functions of an official unit of account and a medium for low-value daily transactions ([16]). The sovereign function of wealth preservation and long-term capital accumulation has been usurped by foreign currency, primarily the US Dollar (USD). This reality creates a vicious circle: the scarcity of local currency deposits limits commercial banks’ ability to extend loans in CDF, which sustains foreign currency dependence, paralyzes the transmission channels of the Central Bank of Congo’s (BCC) monetary policy ([15]), and increases the economy’s overall vulnerability to external shocks ([27]).

Faced with this challenge, traditional public policies have too often focused on money supply (credit controls, liquidity sterilization, ad-hoc interventions in the foreign exchange market) or attempts at administrative regulation of dollarization. This scientific study starts from a different paradigm: the reconquest of monetary sovereignty cannot be achieved through coercion or simple modifications of currency signs, but rather through direct and incentive-based action targeting the demand for money as a financial asset ([14]).

The fundamental prospective contribution of this research lies in the theoretical, empirical, and operational formulation of a breakthrough reform: the creation of the Sovereign Savings Account in Congolese Francs (SSA-CDF). This mechanism aims to institute a standardized bank savings product, regulated by the BCC, offering high real yields and protected by a high-level prudential framework. The ultimate objective is to progressively redirect the portfolio choices of households, enterprises, and Congolese institutions in favor of the national currency ([34]).

This analysis is theoretical and scenario-based unless an estimated econometric model, variables, sample period, and estimation method are included. The current manuscript presents accounting simulations rather than econometric results.

1.2.1. The Functions of Money and the Asset Substitution Phenomenon

According to classical monetary theory ([20]; [17]), money fulfills three fundamental functions: medium of exchange, unit of account, and store of value. In economies afflicted by financial dollarization or monetary hysteresis ([5]; [29]), a process of functional asymmetry takes hold. The national currency retains its role as legal tender for routine transactions, but loses its capacity to preserve value over time to currencies perceived as stable ([11]; [19]; [31]).

The literature distinguishes between currency substitution (using foreign currency for transactions) and asset substitution (holding foreign currency securities or deposits to protect wealth). In the DRC, asset substitution is predominant. As shown by [7] and [13] in their minimum variance portfolio (MVP) model, the degree of financial dollarization depends directly on the relative variance of inflation compared to that of the real exchange rate. When domestic inflation volatility surpasses exchange rate volatility, rational agents minimize portfolio risk by holding their financial assets in foreign currency ([28]).

1.2.2. Unilateral Dollarization and the Coercive Impasse

The works of [29] emphasize that dollarization is a highly persistent phenomenon (“hysteresis”). Attempts at forced or coercive de-dollarization (such as the authoritarian conversions of deposits applied in Latin America in the 1980s) have systematically led to capital flight, banking disintermediation, and the massive expansion of the informal financial sector ([30]). Conversely, successful experiences of de-dollarization (notably in Peru, Poland, and Uruguay) rely on market-based strategies combining inflation targeting ([33]), the development of attractive financial instruments in local currency, and prudential differentiation ([10]; [6]).

1.2.3. Monetary Transmission in a Bi-Monetary Economy

In a context of high dollarization, the effectiveness of the Central Bank’s policy rate is considerably eroded ([21]; [32]). The credit and interest rate channels operate only on the marginal component of the money supply denominated in national currency. As demonstrated by [18], restoring monetary sovereignty requires re-expanding the bank balance sheet in local currency to restore depth to the interbank market and amplify the sensitivity of consumption and investment decisions to Central Bank impulses ([6]).

Rather than relying on ex-post econometric estimation requiring high-frequency historical data that are not available, this research adopts an accounting simulation and deterministic scenario analysisapproach ([12]). In the absence of formal econometric regression models (such as VAR or error-correction models) and formal statistical validation tests, this study is positioned as a theoretical and prospective financial engineering exercise. It aims to simulate the macro-financial and balance-sheet impact of a targeted transition in the deposit structure (aiming for de-dollarization thresholds of 20% to 40%), by explicitly stating agents’ behavioral assumptions and accounting transmission mechanisms. The results derived from these scenarios must therefore be interpreted as normative projections designed to inform strategic decision-making, rather than as empirically measured econometric findings.

The Sovereign Savings Account in Congolese Francs (SSA-CDF) is defined as a standardized bank savings product in national currency, governed by a specific regulatory statute from the Central Bank of Congo, distributed by all authorized commercial banks, and designed to mobilize domestic savings over the medium and long term.

The qualification “sovereign” does not mean the State undertakes to directly finance the account or substitute its guarantee for the private management of banks. It expresses the fact that this product constitutes a trusted public asset, benefiting from a privileged institutional architecture: ad hoc prudential regulation, total transparency, enhanced depositor protection, and targeted tax exemptions.

To break away from the practice of volatile demand deposits, the SSA-CDF is designed as a restricted-availability account offering an escalating remuneration grid according to the duration of funds commitment (Tables 2-3).

Table 2.De-dollarization strategy: SSA-CDF key components and macro objectives.

Table 3.SSA-CDF growth simulation table.

To modify economic agents trade-offs in favor of the Congolese Franc, the nominal interest rate offered on the sovereign account (SSA) must be designed to guarantee a net positive real return while incorporating risk premiums. We formulate the following decision-making rate model:

where:

π e represents anticipated inflation over the account’s maturity period; ρ is the real yield premium required to encourage domestic savings; p is the maturity premium (increasing with the time horizon: 6 to 60 months); s is a macro-prudential prudence coefficient preventing intermediation overcosts for the banking system.

Alternatively, within an international rate arbitrage logic (Uncovered Interest Rate Parity), the rate must satisfy the condition:

Where r U S D is the interest rate on dollar deposits, E ^ e is the anticipated depreciation rate of the CDF against the USD, and γ represents the sovereign/country risk premium.

Consider the capitalization dynamics of an initial capital C 0 placed in an SSA-CDF account over a duration of n years at an annual nominal rate r . Using the compound interest formula:

To illustrate this financial mechanism, let us apply an example based on a capital of 1,000,000 CDF placed at a hypothetical nominal rate of 12% per year:

Based on total deposits observed in August 2026 (46582.810 billion CDF), we model three scenarios for reclaiming the national currency under a constant stock assumption (Table 4):

Table 4.Macroeconomic scenarios for Congolese franc recovery and liquidity gap.

Analysis of Scenario C demonstrates that achieving a 40% share of CDF deposits implies the conversion or net collection of over 13,284 billion CDF. Such a volume would fundamentally alter the country’s financial landscape, creating a domestic liquidity base capable of fueling domestic bank credit. It’s interesting to consider transmission Mechanisms in constant-total scenarios. In fact, in simulations where total bank deposits are held constant, it is essential to rigorously distinguish between two distinct channels of increase in CDF deposits:

Portfolio Conversion (Reverse Currency Substitution): Economic agents decide, voluntarily or through regulatory incentives, to exchange part of their foreign currency holdings (USD) for Congolese Francs (CDF). This mechanism alters the structure of bank liabilities without injecting new liquidity: USD deposits decrease in proportion to the increase in CDF deposits, at the prevailing exchange rate.Injection of Net New Deposits: This mechanism assumes the inflow of fresh savings or the repatriation of external liquidity (or monetized credit expansion).

In our prospective scenarios of targeted de-dollarization (raising the CDF share from 11.48% to thresholds of 20% to 40%), the default mechanism relies primarily on portfolio reallocation within the existing bank balance sheet, requiring careful foreign exchange risk management by commercial banks.