Bancarization in the first European cities with an equal number of Muslim and Christian inhabitants: Melilla and Ceuta

Abstract

Purpose – This research study analyses the situation of the financial system in the Spanish-governed cities of Melilla and Ceuta, Christian and Muslim cities located on the north coast of Africa, and compares it with the mean bankarisation level in the rest of Spain, referring to the 2000-2015 period. Design/methodology/approach – Although different calculation methods have been proposed, most authors agree that the bankarisation level of a country or a territory reflects the development of the society as a whole and has a positive correlation with economic growth. The indicators of financial depth proposed by these researchers are not only the ratio between variables such as loans, deposits, etc., but also the ratios of these variables to the population and the GDP of the country or territory. Findings – The results obtained revealed that there are significant differences between these two North African cities. Furthermore, the financing gap between the mean bankarisation levels of these cities and those of mainland Spain was found to be even larger than most of the other economic indicators (GDP per capita and the unemployment rate). Originality/value – This is the first work on a financial framework of European cities whose populations are spread by almost 50 per cent between Christians and Muslims. The data provided show the existence of methods of funding or savings parallel to conventional banking, by cultural customs or Muslim religion, which must be taken into account by European banks in the near future.