Azerbaijani banks accelerate the digitalization of payments, services in 2020 (Interview)

Azerbaijani banks accelerate the digitalization of payments, services in 2020 (Interview)

BAKU, Azerbaijan, Jan.28

By Sadraddin Aghjayev - Trend:

The current COVID-19 pandemic period plays an important role in determining development tendencies in digital payments, Tamerlan Rustamov, Head of the expert group on payment systems and digital banking of the Azerbaijan Banks Association (ABA), told Trend.

According to Rustamov, the benefits applied by the Central Bank of Azerbaijan (CBA) during the pandemic (a 50 percent reduction in service fees for cards, contactless options for extending the validity of payment cards, delivery of bank cards at the request of customers, an increase in the number of contactless payments and a number of other services) had a positive impact on the development of digital payments.

"Moreover, the processes of digital payments’ development were accelerated, new products and services in the digital ecosystem were introduced by the banks, reforms were carried out to improve mobile banking services, the spheres of activity of non-bank payment service providers were expanded and their interaction with banks was intensified, as well as the activity of e-commerce platforms was improved," he said.

Besides, he noted, according to the Central Bank of Azerbaijan, as of December 1, 2020, 55,000 POS terminals were installed in the country in retail trade, catering, and other facilities in Azerbaijan.

"An average of 83 payment transactions were made in the amount of about 4,069.4 manat ($2,393.7) during November through each of the POS-terminals installed in retail trade, public catering, and other facilities. This figure reached 1,796.6 manat ($1,056.8) or 37 successful transactions for the same period of 2019 while in 2018 - 1,616.2 manat ($950) or 23 payments through one terminal,” pointed out the group’s head.

The total volume of non-cash payments through the network of POS terminals with payment cards issued in the country amounted to 1.9 billion manat ($1.1 billion) for 11 months of 2020. This figure has doubled compared to the same period of 2018. The total volume of e-commerce transactions for the analyzed period amounted to 3.3 billion manat ($1.9 billion). An increase of 2.5 times is observed here.

In general, the turnover of non-cash payments on transactions with payment cards amounted to 22 percent.

“Taking into account the statistics data, the products and services which are provided by payment service providers, small and medium-sized businesses should highly appreciate the existing potential for accepting non-cash payments,” he stressed.

The ABA’s representative also noted that many business entities in Azerbaijan have already adapted to the requirements of the new reality in order to maintain their activities during the COVID-19 pandemic.

“These requirements are mainly to be met in the digital payments area, which is characterized by e-commerce sales organizations depending on the products and services provided by these entities, as well as by expanded cooperation with e-commerce platforms, creation of an infrastructure for POS terminals, a courier service and providing the ability to make payments through a POS terminal at the address,” he added.

Besides, according to him, in a number of cases, business entities that provide their goods and services via the Internet under the guise of e-commerce and without using digital payments accept payment with their subsequent registration in cash.

“Sometimes entrepreneurs accept such payments through our usual payment terminals,” he also noted.

As the group’s head pointed out, in order to use the advantages of digital payments in their field of business, business entities must first decide on the products and services that they will provide.

"Based on this, possible digital payment solutions must be implemented by providing products and services through the formation of an e-commerce page or using the services of e-commerce platforms for this purpose, the formation of a contactless infrastructure through POS terminals, cashless payments on the spot and in a number of other areas," said Rustamov.

In his opinion, after identifying the products and services to be sold, as well as possible solutions for digital payments, the bank must be chosen.

"The main factors to look out for when making the choice are the efficiency of the digital solutions provided by the bank, tariffs, availability of an extensive network of services, expected security requirements, and other factors," he added.

Along with the above, Rustamov stated that the CBA successfully continues to play a dominant role in the formation of an extensive digital ecosystem based on the ‘web’ principle and accelerate the introduction of innovative solutions.

“The main elements that disclose this policy are the launch of an instant payment system, a digital identification system based on blockchain technology, regular improvement of the regulatory framework for digital payments, as well as incentive reforms,” he noted.

In addition, Rustamov said that the ABA, Visa, MasterCard, and Worldwide, in cooperation with local banks, are carrying out educational and stimulating campaigns in the field of digital payments. The ABA also focuses on the formation of a unified and reasonable approach to the banking system in the field of digital payments in banks.

“Successful projects are being signed to deepen digital transformation. First of all, this is due to the attraction of attention to the improvement of mobile banking services and the creation of more favorable opportunities for access to financial services for the general population. The issuance of virtual payment cards through mobile banking has begun. Some banks, as a result of the introduction of tokenization services within the framework of cooperation with the international card organization Visa, have achieved payment transactions using mobile phones without a payment card.

The next successful project aimed at expanding the coverage of digital payments was the possibility of cashless payments by payment cards in public transport in the cities of Sumgayit and Shamakhi, as well as on trains in the Baku-Sumgayit direction,” the head said.

According to Rustamov, educational events held on a regular basis with the participation of international financial institutions are of great importance in the development of digital payments in terms of increasing financial literacy.

“The publication of the textbook and curriculum ‘Digital Payments and Electronic Banking Services’ with the participation of ABA, the international card organization Visa, the Zolotaya Korona money transfer system, and other financial institutions, will provide a new generation with theoretical and practical knowledge in the field of digital payments,” noted Rustamov.

The head of the ABA expert group concluded that all these reforms in the field of digital transformation will have a positive effect on increasing the competitiveness of the payment ecosystem of Azerbaijan, expanding the coverage of digital payments, strengthening financial inclusion (inclusion of all segments of the population in the financial system), as well as the creation of society, for which digital payments will become a familiar form of payment.


Follow the author on Twitter: @agdzhaev

WHO calls for strengthening women's leadership during COVID-19
WHO calls for strengthening women's leadership during COVID-19
Canada set to mourn COVID-19 victims, salute health workers on March 11
Canada set to mourn COVID-19 victims, salute health workers on March 11
UN chief urges countries to adopt special measures, quotas to advance women's equal participation
UN chief urges countries to adopt special measures, quotas to advance women's equal participation
Loading Bars
Italy's coronavirus deaths top grim milestone of 100,000
Estonia introduces strict one-month quarantine from March 11
EFSE sets to deepen engagement with Georgian financial institutions
Israel reports 3,130 new COVID-19 cases, 804,591 in total
WHO calls for strengthening women's leadership during COVID-19
Number of new COVID-19 cases in Spain continues to fall
PayPal buys Israeli cyber security company
France reports 359 new COVID-19 deaths, ICU admissions hit new high
EU to receive 100 mln vaccine doses per month from April: von der Leyen
Canada set to mourn COVID-19 victims, salute health workers on March 11
UK PM says higher risk of virus transmission "inevitable" as schools reopen in England
Finnish researchers develop nasal spray COVID-19 vaccine
Germany starts easing COVID-19 lockdown
Conversations ongoing on potential projects between Turkmenistan, UK
Exports to Iraq via Mehran crossing top $460m
Turkey passes 10 million mark in COVID-19 vaccinations
Georgian parliamentary committees to hear report on HPP construction
Official representative of Presidential Administration of Azerbaijan thanks Israel for medical assistance - Israel HaYom
UN chief urges countries to adopt special measures, quotas to advance women's equal participation
UK records another 4,712 coronavirus cases
Supreme Court rejects final Trump election challenge
India may start full operations at Chabahar port by May end
Iran profits from gas transmission development
Georgia 1st among best destinations for vaccinated travellers in 2021
Erdogan, Johnson discuss bilateral developments over phone
Electricity consumption in February amounted to 1.6 bln kWh in Kyrgyzstan
US coronavirus cases exceed 29 mln
Yellen says Biden COVID bill to fuel 'very strong' U.S. recovery
Iran's budget deficit decreases
Iran's Energy Exchange announces products to be on sale on March 9
Africa's confirmed COVID-19 cases pass 3.96 mln: Africa CDC
Syria's President Bashar al-Assad tests positive for Covid-19
Employment in Iran's industrial sector increases
Bulk of Jan.2021 loans to electric energy sector in Azerbaijan issued in foreign currency
Azerbaijan confirms 71 more COVID-19 recoveries
Loading-unloading of cargo in ports of Iran's Gilan Province expands
Iran's power consumption reduced by Omid plan
Iran to inaugurate more projects in free economic zones
Iran has developed steel supply chain - Iranian President
Iran's Securities and Exchanges Organization talks number of investors in capital market
Iran’s Bahar Azadi gold coin price rising
Volume of dry-farming land in Iran increases
Iran's NISOC begins excavations on its territory
Iran’s South Pars Gas Company reveals production data of its refinery
Iran waits for Europeans to comply with the JCPOA - MFA
Iran to make decision whether to open schools after Nowruz holiday
Production of LPG-fueled cars in Iran's interests - Chamber of Commerce
Armenia's war crimes exposed at UN Congress
Azerbaijan sees growth in Jan.2021 transactions via clearing system for small payments
Iran boosts car manufacturing
Spanish La Vanguardia: Return to Azerbaijan's Karabakh after war
Azerbaijan’s export of ferrous metal products down
Turkmenbashi Oil Refineries opens tender for purchase of gasoline
Britain's M&S expands online business to over 100 markets
Dustbin of history - place for former Armenian president Kocharian, 'Karabakh clan' - historian
Khazar Consortium opens tender to purchase cementing unit
Turkey’s food retail chain Migros to bolster gender-equal workforce and greener stores
Iran Mercantile Exchange working to expand sale of goods
Iran reveals COVID-19 data for March 8
Modi to inaugurate Maitri Setu between India and Bangladesh on Tuesday
India's Covid Vaccine Rollout "Rescued The World": Top US Scientist
India pre-eminent partner of US in Indo-Pacific region: Blinken tells Jaishankar
Bachendri Pal to lead all women team aged above 50 in a 5 month long Himalayan expedition
Satellite set for Mar 28 launch will provide near real time images of borders, quick monitoring of natural disasters
Sikh Fighter Pilot Memorial In UK To Honour Indians Who Fought In World Wars
IMF, Georgia review agenda of bilateral cooperation
Iranian President and Irish FM discuss JCPOA
Iran reserves strategic basic goods
Iran’s Rouhani asks for release of frozen assets in Iraqi banks
Iranian parliament approves increase of salaries to aid low incomes
Iran not to allocate Nowruz gasoline quota due to COVID-19
Uzbekneftegaz establishing production of import-substituting products for industrial enterprises
Iran to obtain its funds frozen in Iraq
Georgia opens new enterprise with support of Rural Development Agency
Interest in entrepreneurship growing among women in Azerbaijan
Export of cotton from Azerbaijan greatly increases in Jan. 2021
Mubarek oil&gas production dep’t owned by Uzbekneftegaz to increase natural gas production
Uzbekistan reveals its COVID-19 data for March 8
Iran unveils number of mining facilities put into operation
Japanese businessmen visit Azerbaijan’s Guba genocide memorial complex (PHOTO)
Development of Iran's Siyahmakan oil field launched
Nearly half of non-oil sector taxes in Azerbaijan falls on mobile operator in 2020
Azerbaijan's Azercell reveals number of processed requests in 2020
Azerbaijan's Jan. 2021 imports from EU show increase
Accumulative life insurance market in Azerbaijan grows
Iran capable of building long water transfer pipelines - Iranian VP
Deliveroo launches London IPO after business surges in 2020
Iran to publish final report of the downed Ukrainian jet soon
No direct or indirect relations between Iran and US - Iranian Foreign Ministry
Approval of FATF related bills would increase Iran's export revenue - Iranian Union
Iranian medicine importers awaiting approval of FATF related conventions
Turkey records slight decrease in car exports abroad
Cement exports from Turkey to global markets grow
Azerbaijan shows footage from Zangilan's Garagoz village (VIDEO)
Turkey's revenues from export of grains, legumes to global markets up
Moscow hosts opening ceremony of another 'Gifts of Azerbaijan' stand
Turkmenistan sells diesel fuel, gasoline to number of countries
Baku celebrating International Women's Day (PHOTO)
Kazakhstan's exports to Portugal plummet amid COVID-19
Kazakhstan boosts trade turnover with Lithuania
All news