Azerbaijan, Baku, 16 May / Trend E. Aliyev /
The banking system of Azerbaijan is developing steadily and no increased risks are being observed in comparison with other markets, the chairman of the Board of Rabitabank JSC Nikoloz Shurgaiya said.
According to him, Azerbaijan's banking sector's development level may be favourably compared with the region that is the majority of neighbouring markets and countries of the western part of the CIS.
"One of the positive factors is that the system is well capitalised and the country's credit rating is high. Correspondingly, the credit quality is at stable and acceptable level compared to the neighbouring markets. The majority of the top 20 banks are perceived as fairly stable," Shurgaiya told Trend.
He noted the need for the Azerbaijani market to develop non-cash transactions.
"It seems to me that the share of non-cash payments in Azerbaijan is less in comparison with neighbouring countries. This can be presumed from a lower level of demand. The turnover on POS-terminals is much less; companies are less likely to use various types of commercial financing or non-cash payments. This is my empirical observation. It is easy to check through looking at the statistics," the board chairman.
According to him, the growth of the share of non-cash payments is affected by many macroeconomic and regulatory factors.
"It seems that the Central Bank of Azerbaijan as well as commercial banks is doing a lot from this point of view. During the six months of my stay here I have been observing the commercial and regulatory actions in this area and expecting the growth of a non-cash circulation. I believe it is a matter of time," Shurgaiya said.
According to the chairman of Rabitabank's board, banks need to expand cooperation, including with regards to ATMs and POS-terminals.
"Maybe we should think about combining the ATM network and establishing unified tariffs for customers. This would have reduced the price of settlements between banks. Business development will require large investments in technology. This is a costly investment and the size of the bank will play a big role in this aspect. Consolidation will benefit the entire banking sector and we are also working in this direction," he added.
Speaking about the role of the bank in the development of non-cash transactions, the chairman of the board noted that Rabitabank today has nearly 600 POS-terminals and 33 ATMs.
"From the beginning we have already installed three additional ATMs and three more are being installed. It is right to say that in general both these areas are not profitable, but we want to develop them for the convenience of customers as well as for long term development of our business and stimulation of non-cash operations. If we and other banks develop this area, we can achieve a breakthrough in the habits of consumers, the transition from cash payments to bank cards. Currently we have approximately 13,000 cards. We provide a wide range of reliable, convenient and profitable debit and credit cards. We also have a special product called Kartmane intended for savings. Overall, we see good growth in this area which will be continued," Shurgaiya said.
According to the Central Bank, the total number of payment cards in Azerbaijan as of April 1, 2013 increased by 11 per cent compared to the same period last year from 4.66 million to 5.175 million. The total number of card transactions during the year increased by five per cent from 5.274 million to 5.541 million. Total volume of transactions on debit and credit cards over the year has increased by 10 per cent from 784 million manat to 865 million manat.
As of April 1, 2013, the total number of ATMs in Azerbaijan increased by 5.8 per cent - from 2168 to 2295 units compared to the same period last year, while the number of POS-terminals increased by 77.3 per cent from 20,994 to 37,266 units.
The official exchange rate is on 16 May 0.7846 AZN / USD.