Market Research Report
Payments Landscape in Azerbaijan: Opportunities and Risks to 2023
|Published by||GlobalData||Product code||635181|
|Published||Content info||45 Pages
Delivery time: 1-2 business days
|Payments Landscape in Azerbaijan: Opportunities and Risks to 2023|
|Published: June 24, 2019||Content info: 45 Pages||
Azerbaijan is a cash-oriented economy due to its high unbanked population, low financial awareness, and inadequate payment infrastructure. Azerbaijan ranks lowest in terms of card penetration and payment card frequency of use in comparison to its peers Poland, Russia, Ukraine, Romania, Turkey, and Kazakhstan, reflecting the dominance of cash in the economy. However, with government initiatives to increase awareness of non-cash payments, financial literacy programs, charges on ATM cash withdrawals, and cash transaction limits imposed on individuals and businesses, payment cards will gain traction over the next five years.
Card payment transaction volume and value are anticipated to record compound annual growth rates (CAGRs) of 18.3% and 15.3% respectively over the forecast period (2019e-23f). The emergence of contactless technology, the adoption of new payment solutions, and growth in the e-commerce market will also support payment card market growth in Azerbaijan.
Debit cards in are mainly issued in the form of social and salary cards. According to the central bank there were 2.5 million social cards and 2 million salary cards in the country as of December 2018, collectively accounting for 80.7% of total debit cards in the country. All of the country's major banks - including Kapital Bank, International Bank of Azerbaijan (IBA), Expressbank, AccessBank, and AGBank - offer specific payroll cards for employees.
The credit and charge card market is still in the developmental stage, with only 10.3 cards per 100 individuals in 2019. In terms of transaction volume and value, the credit card market registered a decline during the review period (2015-19e), mainly due to low levels of financial literacy, limited awareness of credit cards, and the declining number of credit institutions in the country.
The E-commerce in Azerbaijan grew significantly during the review period, rising from AZN12.8m ($7.5m) in 2015 to AZN111.9m ($66.0m) in 2019 at a review-period CAGR of 72.0%. The market is anticipated to reach AZN275.8m ($162.6m) in value by 2023. The proliferation of mobile internet users and smartphones are the key drivers of this strong growth. The availability of virtual cards exclusively for online shopping and alternative payment solutions such as PayPal, Wallet One, and Azerpay will help boost the e-commerce market over the forecast period.
The report "Payments Landscape in Azerbaijan: Opportunities and Risks to 2023", provides detailed analysis of market trends in Azerbaijan's cards and payments industry. It provides values and volumes for a number of key performance indicators in the industry, including cards and credit transfers during the review-period (2015-19e). The report also analyzes various payment card markets operating in the industry, and provides detailed information on the number of cards in circulation, transaction values and volumes during the review-period and over the forecast-period (2019e-23f). It also offers information on the country's competitive landscape, including the market shares of issuers and schemes.
The report brings together research, modeling, and analysis expertise to allow banks and card issuers to identify segment dynamics and competitive advantages. The report also covers details of regulatory policy and recent changes in the regulatory structure.
Companies mentioned: Kapital Bank, International Bank of Azerbaijan, Expressbank, AGBank, AccessBank, Unibank, Bank of Baku, YapiKredi Bank, Visa, Mastercard