By Anvar Mammadov
Over the past three years, a share of non-cash payments in Azerbaijan has increased by four percent, Mandy Lamb, Group Country Manager of Visa in CIS and South-Eastern European countries, said in an interview with Trend.
She added that Azerbaijan has a great potential to increase the share of electronic payments.
“We have been in the market for a number of years and in the last three years we have seen the biggest growth of electronic payments, despite the fact that the economy had one of the biggest challenges for the last couple of years,” Lamb said. “We still see a huge opportunity for further growth of electronic payments in Azerbaijan.”
“We measure the ratio between card payment operations and total volume of operations,” she said. “The fact is that three years ago, only seven percent or seven manats out of every 100 manats spent in the country, were spent electronically via cards and the rest was cash. Today this figure equals 11 percent.”
“That is, over three years, there was an increase of four percent, which may seem small, but if you look at some developing markets, you will see that it takes years to achieve significant ratio growth,” Lamb said. “For example, in the Belarusian market, this figure makes about 36 percent, so the opportunity of growth is there.”
Lamb said that over the last 1,5-2 years, despite the national currency devaluation and economic challenges, the Azerbaijani market of cashless payments continues to grow and introduce innovations, and potential for its growth is higher than in some other countries in the region.
“Consumers are still spending money domestically, but we are observing a shift towards e-commerce, which is taking place in other countries of the CIS region as well,” she said. “Consumers began to travel less due to changes in the exchange rate of manat; however, at the same time, the number of online purchases has increased – both on local and foreign web sites.”
“This is a good trend, as consumers feel more confident,” she added. “As for innovations, together with our another bank partner, couple of months ago we launched a new product – Dual Card, that combines two fully featured Visa cards – debit and credit. Azerbaijan has become the first market in the CIS region, where this innovative product has been launched.”
“We also have a number of mobile innovations that we can launch here,” Lamb said. “We can say that general trends are quite similar in the region. But I believe that the potential of electronic payments is slightly bigger here than in the other markets; because, as I have already mentioned, only 11 percent of payments out of every 100 manats are carried out in an electronic format, and so there is room for growth.”
She added that over the past 3 years, the volume of cashless payments measured in USD has increased by 15 percent.
“As it was mentioned by Igor Kovalev, Visa country manager for Azerbaijan, in 2016, the volume of payments has increased by 15 percent, as compared to figures of 2013,” she said. “This shows that consumers have the same, if not less consumer spending power; but instead of cash, they are shifting to electronic payments.”
“This growth can be achieved as a result of increased electronic payments in stores and retail outlets, as well as online purchases, which is a good indicator, especially in the current economic circumstances,” Lamb said.
She added that the company would continue to further invest in Azerbaijan and develop the market of electronic payments in the country.
“All mentioned above shows that the cashless expenses are gradually replacing cash ones in Azerbaijan, and that’s why we are going to continue investing in this market and try to further develop it,” Lamb added.
According to the Central Bank of Azerbaijan, in October 2016, the card payment turnovers using ATMs and POS-terminals in Azerbaijan amounted to 1.07 billion manats, which is four percent more than the figure in the same period last year.
The total number of transactions carried out using payment cards for this period made almost 7.11 million (a decrease of 4.01 percent a year).
In October, the number of payment cards has decreased by 6,2 percent compared to the same period last year, i.e. down to 5.33 million units.
Major share of the cards – 4.64 million – are debit ones, in particular, 2.51 million – social cards, 1.51 million – salary cards, 0.62 million – others. The number of credit cards for the said period made 688,000.