BAKU, Azerbaijan, June 24. Fintech is a new financial paradigm, and one of the most significant transformations we've observed in the financial system in recent years is the growing role of fintech companies, Member of the Board of the Central Bank of Azerbaijan (CBA) Vusal Khalilov said at the FINTEX SUMMIT 2025 – Finance and Technologies Exhibition held today in Baku, Trend reports.
He noted that in today’s dynamic digital world, users expect fast, secure, and personalized financial services.
"Fintech is the main driving force that makes these expectations a reality. As the Central Bank, along with developing and implementing policy and oversight concepts for relevant sectors, we have defined the promotion of digital financial solutions, adoption of innovative technologies, and the building of an inclusive fintech ecosystem as one of our strategic priorities," Khalilov said.
The official emphasized that the creation of a balanced and flexible regulatory framework in the field of financial technologies, introduction of new technological solutions to the market, ensuring universal access to digital financial services, and establishing efficient information flow with market participants are among the key objectives.
“We believe that our ongoing projects such as Open Banking, Distributed KYC (Know Your Customer), and especially the Instant Payments System will play an important role in the development of fintech.
It is well known that improving the legal framework and ensuring its enforcement are our core functions. Through continuous discussions with relevant associations and their expert groups, we aim to identify the concerns of market participants and reflect them in new versions of laws and regulations, ultimately creating a favorable legal foundation for the safe implementation of innovative products and services," he said.
He recalled that the CBA is currently implementing risk-based supervision mechanisms under the “Financial Sector Development Strategy 2024–2026. As part of these improvements, the use of artificial intelligence-based models is expected to expand.
“The main idea I want to share on this topic is that supervision functions serve to uphold the rule of law, create a competitive market environment, and protect the sector from potential risks,” the official explained.
Khalilov pointed out that development of the Instant Payments System, which enables 24/7 payments directly from bank accounts, is ongoing.
"By expanding the system’s scope, technical stability, and functionality, more rapid and convenient payment options are being offered to users. When comparing the first four months of 2025 with the same period in 2024, the number of transactions processed via the Instant Payments System increased by over 40 percent. We are closely monitoring this growth trend and expect the positive trajectory to continue in the coming months," he clarified.
He mentioned that in 2024, the total turnover processed via payment cards issued by domestic banks exceeded 126 billion manat ($74.3 billion), showing a 27 percent increase compared to 2023. As of April 2025, the monthly volume of cashless payments made via payment cards has approached 10 billion manat ($5.9 billion).
A the same time, in the first four months of 2025, more than 67 percent of domestic payments made via cards were cashless, while the number of cashless transactions exceeded 91 percent. This means that nine out of every 10 card-based domestic transactions were carried out without using cash," the official mentioned.
Khalilov emphasized that today’s successful financial institutions are evolving into technology companies, prioritizing digital business management.
"If we analyze successful examples from other countries, it’s clear that two key factors underpin their success: human capital and the application of standards.
In the digital environment, knowledge domains such as engineering, product ownership, and design are fundamental to success. As is well known, gaining these skills in a short time is not easy. That’s why proper guidance and experience are essential in each domain. With this in mind, and with the support of the CBA, the final of ICPC (International Collegiate Programming Contest) — the world’s most elite programming competition — will be held in Azerbaijan this year. This means the best programmers from the world’s top universities will be coming to Azerbaijan. Global organizations will focus their attention on our country during this event, as their success often stems from highly skilled talent. The participation of leading executives and engineers from organizations like OpenAI, Meta, and Google as ICPC alumni further demonstrates our country's growing reputation in this field. I believe that hosting the final in Azerbaijan will contribute to the popularization of this domain," he forecasted.
Khalilov stated that the CBA team is currently working on management frameworks for IT Governance, Data Management, and Artificial Intelligence, and plans to present final products to the sector soon.
"These frameworks are being developed based on international standards and aim to make institutional processes more resilient, secure, and efficient.
The new Data and Cybersecurity regulations that came into force in April of this year were a significant step forward for sector security. With the expansion of cashless payments, there is a direct correlation with the increase in cyberattacks and fraud. Therefore, investment in cybersecurity is extremely important today. Organizations are currently aligning their roadmaps with the CBA to ensure full compliance with the regulations, and as the regulatory body, we highly appreciate the efforts being made in this area.
We approach these processes not only as a regulator but also as an active initiator, platform creator, and contributor to public good. Our goal is to create an innovative, competitive, and reliable financial environment. In this regard, open dialogue and collaboration with all ecosystem participants is of great importance.
The sector participants should not view each other as competitors in market development, but rather as partners, acting together for common goals. A strong ecosystem is based on trust, open dialogue, and shared responsibility. Every institution should not only be an executor but also an initiator, playing an active role in shaping the future. New cooperation models and platforms like this summit are designed to serve that purpose," the official added.
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