Mastercard helping Kazakh banks to build co-op with fintechs - CEO (Exclusive)

Kazakhstan Materials 29 July 2023 08:32 (UTC +04:00)
Mastercard helping Kazakh banks to build co-op with fintechs - CEO (Exclusive)
Asmar Bayramova
Asmar Bayramova
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BAKU, Azerbaijan, July 29. Mastercard is actively involved in initiatives aimed at the development of fintech in Kazakhstan, Rafal Trepka, CEO of Mastercard in Central Asia told Trend in an interview.

"For example, the Fintechstars Innovation Day online marathon as part of Astana Finance Days – First Fintech Accelerator for banks in Kazakhstan, the Mastercard Sustainable Banking Challenge, which we held together with the AIFC (Astana International Financial Center) Tech Hub and the Internet Initiatives Development Fund," he said.

According to Trepka, this project helped Kazakh banks build cooperation with fintechs. The main areas of competition were financial inclusiveness, green banking, and internal sustainable development (optimization of the bank's internal processes). Based on the results of the competition, the best projects got the opportunity to launch a pilot project with partner banks of the competition, receive expert support from Mastercard and then scale up the successful pilot.

"During industry conferences and events – Astana Finance Days, Almaty Investment Forum, Digital Almaty – we present to our partners and the general public Mastercard's vision of how digitalization can transform the economy and society, creating opportunities to increase the efficiency of business and government agencies and to improve people's lives," he added.

Together with partners, Mastercard creates vibrant products that reflect the individual preferences and interests of cardholders and also provides special offers for cards in various categories, including travel, entertainment, shopping, gastronomy, etc.

Furthermore, the CEO also touched on the overall activities of Mastercard in Kazakhstan. According to him, Mastercard has been operating in Kazakhstan since the mid-90s, and in 2012 opened an office in Almaty. Last year the company celebrated the 10th anniversary of its activity in the country.

"During these years Mastercard has been actively working with the National Bank, second-tier banks, many fintech and other organizations. Mastercard's partner banks include leading banks in Kazakhstan, such as Al Hilal, Altyn Bank, Eurasian Bank, Freedom Finance Kazakhstan, ForteBank, Halyk Bank, Jusan, Kaspi, National Postal Operator Kazpost and others. We continue to connect new banks, and we are working hard to introduce technological and product innovations with partner banks," said Trepka.

He went on to add that the main priorities of the company's activity are increasing the volume of issuance and transactions involving Mastercard cards, providing banks with full access to expertise and international experience, developing financial inclusion in Kazakhstan and introducing innovative products and services.

"Today we are doing projects with government agencies, fintech and other technology companies, trade enterprises, both offline and online. Cybersecurity is our number one priority, we also work hard to develop loyalty products, conduct research, and provide consulting services. Over the years, we have greatly expanded the range of services for the premium segment, updated recently. Now premium card holders can use not only insurance, business lounge at the airport and concierge service, but also insure relatives and family assistants, a rented car, use the fast track service at airports around the world, and special offers in other countries," he said.

Furthermore, the CEO added that the company is ready to help all interested market participants with its experience and technologies. Despite the explosive growth of cashless payments in Kazakhstan in recent years, there is still a very large field for the introduction of both financial and non-financial solutions in the country.

According to Trepka, since a large proportion of the population of Kazakhstan is young people, Mastercard also pays a lot of attention to supporting education.

"Mastercard is expanding access to its Girls4Tech STEM (Science, Technology, Engineering, Math) curriculum for 8-12-year-olds, which we have translated into Kazakh. The company cooperates with the world's largest youth organization AIESEC, annually conducting internships for students. Young people not only get valuable experience, but also do projects that really develop Mastercard's business in Kazakhstan. This helps the realization of human potential and the development of the children’s leadership skills," he said.

Also, Trepka highlighted that Mastercard actively supports the ESG agenda.

"For example, one of our goals is to plant 100 million trees around the world by 2025, and help partners grow in this direction. In Kazakhstan, together with the Eurasian Bank, the Eurasian Environmental Fund (EEF) and the Almaty Green Economy Department, we are collaborating on environmental projects to reduce the carbon footprint in Almaty. As the first project, an alley was planted in the recreational area of Esentai River in Almaty. The Eurasian Bank, together with Mastercard, has issued the first eco-card in Kazakhstan made from recycled plastic, which enables everyone to support greening and waste sorting in the country through contribution from each transaction to the environmental fund," he said.

Moreover, as the CEO noted, during the last 10 years Mastercard has introduced many interesting and useful technologies in Kazakhstan.

"For example, we were the first who implemented the technology of contactless payments, when it became possible to touch the terminal with a card to make a payment. Many people do not even remember that we used to insert card into a POS-terminal and enter PIN-code," Trepka noted.

A landmark project was also the contactless fare payment in the Almaty subway in 2015. At that time, Almaty was the 5th city in the world to have this option.

"We went further and began to develop contactless payments in the form of payment with gadgets, smartphones and watches, the role of which was growing rapidly at that moment. Using the capabilities of a global company Mastercard helped bring Apple Pay, Samsung Pay and Google Pay to Kazakhstan," he said.

According to Trepka, these were the most important steps towards the digital future, which helped even more citizens of Kazakhstan to get the opportunity to choose the most convenient and secure payment method.

"In a restaurant or shop in Kazakhstan, you may see a waiter accepting payment on their mobile phone. This service, when an ordinary smartphone becomes a full-fledged POS terminal for accepting card payments is called 'Tap on Phone'. This convenient solution works great for the development of cashless payments in the places where payment was previously available in cash only – in small shops, bazaars, hairdressers, shoe and clothing repair shops, flower boutiques. 'Tap on Phone' benefits all parties – entrepreneurs, banks, and cardholders, contributes to the formation of a more open and transparent environment for all participants of the economy," the CEO added.

Furthermore, Rafal Trepka also touched on the collaboration with local financial institutions in Kazakhstan.

"In all countries where Mastercard operates, including Kazakhstan, we cooperate with public and private financial institutions to create a digital economy, increase the availability of payments, and bring innovative payment technologies to the market," he said.

Small and medium businesses in many countries form a large part of the national economy. As he noted, globally, Mastercard has accepted and recognized the task of supporting the digitalization of small and medium-sized businesses as one of its priorities and has developed an integrated approach in this direction. This also applies to Kazakhstan.

As an example, he talked about the cooperation with the Ministry of Trade and Integration of the Republic of Kazakhstan.

"The COVID-19 pandemic has given a powerful impulse to the development of online services around the world. In 2022, thanks to the initiative of Mastercard an online e-Commerce School for SMEs was established that held by BTS Education and supported by the Ministry of Trade and Integration of the Republic of Kazakhstan. The purpose of the school is to train representatives of Kazakh small and medium-sized businesses in the basic skills of doing business online with the help of specially designed lectures and interactive materials," he said.

The online e-commerce school is located on the LMS platform ecommerce.jumysbar.kz. Training courses that everyone can take are now very relevant, e.g. how to open an online store, how to connect online payment tools, how to target advertising, how to maintain pages on social networks, how to sell goods on international online platforms, how to ensure cybersecurity, and so on. Entrepreneurs and representatives of SMEs can study online at a convenient time, with the possibility of repetition. During the training, entrepreneurs can evaluate the usefulness of integrating Mastercard payment technologies into their business, for example, Card on File, Payment Gateway, Acceptance and Trade, etc.

"Together with our partners, we held educational webinars on such topics as "Advertising and Digital Promotion", "From Business to E-Business", "Electronic Payments", etc. The trainings were conducted by leading independent experts, specialists from large international companies with extensive and diverse experience in such areas as Internet marketing, e-commerce, accounting, cash flow management, etc.," Trepka said.

Moreover, as he noted, Mastercard also supported the SME acceleration program. The winners of the Program received financial support for business development.

"This year we have taken the next step – we have signed a Memorandum of Understanding with the Ministry of Science and Higher Education of the Republic of Kazakhstan, and now we are working on the development of educational elective programs for universities that will help Kazakh students to improve their financial literacy and probably to start their own businesses," he said.

The CEO added that Mastercard cooperates with the administrations of Almaty and Astana in the field of tourism development. As a technology company, Mastercard has a unique expertise in data analytics and can provide partners with access to the Mastercard Tourism Insights platform. The platform provides targeted analytics related to global tourism – for example, data for each stage of the travel life cycle, information on the total number of tourists in a particular location, number of days of stay, popular booking destinations, average spend, and miscellaneous data across competitive travel markets.

"In collaboration with the Mastercard Center for Inclusive Growth and its partners, women's micro-enterprises will be also supported in Kazakhstan. And these are only some of the projects that we are implementing in Kazakhstan," he said.

According to the CEO, Mastercard is consistently working to ensure that more advanced solutions are available in the region.

"Kazakhstan adopted the “Digital Kazakhstan” strategy, where the goals of Mastercard and the governments of the countries completely coincide. We know that in Azerbaijan the Central Bank has also adopted the “Digital Payments Strategy for 2021-2023”. In Kazakhstan, in the long term period, we focus on payments and products nationwide and interact with government agencies to implement them. We are talking about cross-border transfers, instant payment system, digital tenge and open-banking. Our goal is to “ground” these services in the country in cooperation with the National Bank of Kazakhstan," he added.

Additionally, Trepka added, that Mastercard is focused on the development of cybersecurity solutions in Kazakhstan.

"The use of biometrics for identity verification is already working in many countries and, as far as I know, is perceived positively in Kazakhstan: according to our research, 30 percent of respondents in Kazakhstan fully support it," he said.

According to the CEO, the Kazakh banks have a huge field of activity and many areas where they can implement both financial and non-financial solutions and technologies.

"Fintech accelerators, including those with our participation, help develop new products and services that are necessary for the market. We see that mobile wallets, fintech companies, artificial intelligence projects, blockchain solutions, payment and insurance solutions, platforms for investors, financial literacy projects, and lending platforms are actively developing," Trepka noted.

He also said that Mastercard is working with cryptocurrencies. Kazakh legislation allows piloting and testing crypto projects and some Kazakh banks have already taken advantage. Last autumn Mastercard supported its partner, the Eurasian Bank, in conducting the first crypto-fiat operation in Kazakhstan.

"Kazakhstan strives to become the leader of the region in terms of the level of digitalization of the economy, and we are happy to support this goal. We actively help our partners in the development and implementation of projects that will expand the offer of innovative products to Kazakhstanis. We believe that our cooperation will contribute to the formation of a more open, safe, efficient and transparent environment for all participants in the economy," he said.