BAKU, Azerbaijan, May 1
By Eldar Janashvili - Trend:
The new program for supporting the digital economy envisages a two-fold decrease in fees for services charged by banks in interbank payment systems until September 30, 2020, to stimulate non-cash payment services and reduce their costs in Azerbaijan, Financial analyst at the Azerbaijani Center for Economic Reforms Analysis and Communication Ayaz Museyibov told Trend.
“The new program also envisages a decrease in acquiring tariffs up to 50 percent to encourage benefits from the relevant banks, manufacturers and a decrease in the costs of business entities on payment card operations,” the analyst said.
“It is necessary to take into account that the new trends in the global economy are changing the existing international methodologies and development paradigms,” the analyst added. “Accordingly, this support is of particular importance, and the country's banks are expected to accelerate the implementation of measures in the direction of digital transformation.”
“Today, the modern banking, the range of operations and spheres of activity are also rapidly changing,” Museyibov added. “So, until recently, the indicator 'the number of bank branches for every 100,000 people' was considered as one of the elements of financial inclusion, but one can see that the demand and range of digital banking services are growing rapidly and lead to a reduction in the number of branches in several countries.”
“According to the official statistics of the Euro Banking Association for 2018, an increase in internet banking from 29 percent to 50 percent over the past ten years has led to a reduction in the number of bank branches,” the analyst said. “Thus, during the corresponding period, the number of bank branches decreased by 21 percent, from 233,000 to 183,000. Over the past 10 years, the number of bank branches decreased by 18,000 in Spain, by 5,800 in Italy and by 8,700 in Germany.”
“Apparently, the economies with an advanced banking system are working on introducing innovative approaches to the banking sphere and ICT, especially during the current pandemic, when the significance of remote banking and digital services is growing sharply,” Museyibov said.
“For the Azerbaijani banking system, this is also considered as one of the priority spheres of development, and banks must not refrain from increasing operating expenses in this sphere,” the analyst said.
“The support measures, along with the banking system, envisage providing the participants in the insurance and capital markets with liquid support, stimulating of regulatory holidays, distance services and a decrease in administrative procedures,” Museyibov said. “The support program as a whole contains successful approaches that have already been tested in international practice in a number of countries.”
“An appropriate support program will allow the Central Bank to thoroughly control a number of banks by appointing temporary administrators and that will have a positive impact on the sustainable development of the capital markets, minimize the systemic risks and protect the macroeconomic status of counterparties,” the analyst said.
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