By Andrew Stevens, CNN
Myanmar (CNN) -- When Nyein Chan Aung sold his house in Yangon recently he faced a dilemma -- what do to with the proceeds. Did he he take his cash to the bank or keep it at home?
He compromised. A third went to the bank, the rest stayed where he lives. In fact, the only reason he deposited anything at all was fear of a house fire.
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This is banking in Myanmar, circa 2013. An outdated and debased system, open for decades to abuse by the previous regime, and shunned by about 90% of the population.
People here completely bypass the banks and keep their money at home. It's the closest thing you'll find to a total cash economy anywhere in the world.
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The Myanmar government has made fixing the banking system a priority but a quick visit to any branch reveals the size of the problem they face.
It's an extraordinary scene: Teller counters and the office tables are literally overflowing with cash. Bricks of the stuff, tied in bundles of a thousand notes balancing precariously on top of each other or littering the floor in large untidy piles. And customers bring in more in bulging shopping bags, while security guards wheel in white rice bags with still more bundles of kyat, as the local currency is known.
Myanmar is still working on a real credit system and ATM machines are a relatively new development -- if they work. Like most businesses in the city and the towns, frequent blackouts means the systems shut down. I tried three ATMs over the course of a day. None worked.
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But it goes much deeper than that. The banking system we take for granted in most countries -- easy loans, financial products, interbank operations, credit -- they're all virtually non existent here. There is no proper corporate banking. Businesses cannot get loan repayment plans of longer than one year. True, they are rolled over but it means the central plank for corporate borrowing -- a realistic repayment schedule -- doesn't exist.
Bank managers still have to telephone the central bank at the end of each trading day to tell them what the balance in the books is.
There is now a banking law before parliament and until that is approved, thorough root-and-branch reform cannot take place. And even when it does, the banks have to overcome enormous mistrust in the system, built up over two generations of mis-management. People here highly suspicious of banks.
One clear sign of change is that credit cards are becoming more common, but only by Visa and Mastercard. No local issuer yet. Visa plans to issue pre-paid credit cards by the end of this year.
It's a small step, but for Myanmar a small step in the right direction is critical as it gets ready to be part of a global integrated financial system.
