Alena Degrik. Cases growth of cashless payments in the world and how they are applicable in Ukraine

Алена Дегрик. Кейсы роста безналичных платежей в мире и насколько они применимы в Украине

Алена Дегрик. Кейсы роста безналичных платежей в мире и насколько они применимы в Украине

Cashless segment, is conquering the world, even where it would seem, has bigger concerns than the ability to pay with a card and a telephone in the home. I will say even more — the most significant growth is observed especially in developing countries.

Why? Very simple — if in a developed country it does so well where there is a desire to do better? Clearly not in comfort. Perhaps that is why the Kiev metro is one of the first in the world to have mastered contactless payment, Apple Pay in Ukraine is breaking records on transactions, and our first mobile Bank came to the same level with the old traditional banks.

The main rule of the growth of cashless payments is to find a “middle ground” between low-cost infrastructure and active incentive to pay non-cash

Implementations of such a rule can be very much and each way correct in their own way. I decided to write about several of them.

China — QR payments: WeChat Pay, Alipay

China is a wonderful example in order to understand how the particular method of payment. For obvious reasons, everyone in the country is controlled with the filing of the Communist party, and therefore services can get access to a huge user base in which all electronic services are a closed system, sharpened by China.

Alipay as a payment service marketplace Alibaba, WeChat Pay as empowering the chief messenger WeChat the country — they have introduced system of payment by QR-code. It is inexpensive, simple and straightforward infrastructure. Everything you need to the merchant to receive the payment is a sheet of paper with a QR code. But what is the incentive the customer to use the app to pay for a QR code?Tencent has resolved this issue nicely: offered the opportunity to give each other money during Chinese New year — traditionally, this was done in cash. The process has begun, and the business took the initiative. Now China is paying the QR code can be almost anything. It is a universal system, making the messenger a second passport.

How it works in Ukraine?

While little apps little, with retail no one interacts, and therefore customers do not see this as an option. Perhaps this will change soon, Masterpass has such a thing, very useful for quick payments.

Kenya — mobile money wallet M-PESA

Here the situation is different. Kenya, an African country. Some of the stereotypes about them are still working: at the time of launch M-PESA solved the problem of almost complete absence of coverage of countries ATMs and Bank branches. How to withdraw money from the card, how to pay for the services, if there is no Internet banking, and cash can always steal the kind of rampant crime.

M-PESA used the existing infrastructure — mobile coverage. Payment for all took place via text messages, which is actively used for communication is a low cost infrastructure. “Mobile money” gave a guarantee of payment and that you don’t Rob is an active incentive for use.

How it works in Ukraine?

E-wallets mobile money in Ukraine is a non-banking alternative financial services. We have mobile wallets a success is WebMoney, Qiwi, Yandex.Money and is a successful Ukrainian project MoneXy. The first prohibited by law, the second has gone along with the Bank. Now this niche is, or closes to bypass the ban, or nothing. But it is now.

India: a bit of everything

India — a large, long, diverse country at the crossroads of cultures. Accordingly, they work and M-PESA, and QR payments from Alipay and PayTM. This is an inexpensive infrastructure. The incentive is a bit similar to Kenya: outside the big cities it is difficult to develop a Bank branch, ATMs, etc. is Much simpler to use the mobile Internet to transfer money between balances, and pay offline using QR codes.

And what about the Ukraine?

But the domestic market is very interesting in deploying non-cash segment of the payments. Even the unique.

  • We have a huge network of payment terminals, is an important method of payment — cash-in.
  • Is PrivatBank, which was able to deploy a vast network of ATMs and POS-terminals across the country.
  • Coverage by Bank branches is also quite well — at least at the big banks.
  • The emergence of Apple Pay and Google Pay has forced banks to massively upgrade POS terminals —with the prospect of full implementation of NFC until the end of 2019. Such rates in Europe just yet.
  • Huge amounts of mobile Commerce Telecom operators — mobile payment represents about 30% of all digital goods. And electronic money is not against the return

All this means that Ukraine is development of the payment infrastructure is developed, the client only benefit. Only difficult business, because the competition is unreal. Because the only way to success is constant experimentation and the creation of new incentives — because the old already makes your competitor.

Source: InvestGazeta

World cases of cashless payments growth and how they are applicable in Ukraine

The cashless segment confidently spreads around the world, even where seemingly there are more important problems than being able to pay with a card and phone in everyday life. I’ll say even more — the most tangible growth is observed especially in developing countries.

Why is that? Very simple — if everything is good in a “first world” country, where does the desire to do better come from? Clearly, not from comfort. Perhaps that’s why Kyiv metro was one of the first in the world to use contactless payments, that’s why Apple Pay in Ukraine breaks transaction records, and our first mobile bank reached the same level as the old traditional banks.

The main rule for a cashless payments growth is to find a “middle ground” between low-cost infrastructure and an active incentive to pay in cash.

There can be a lot of implementations of such a rule, and each path is a right one in its own way. I decided to write about a few of them.

China — QR payments: WeChat Pay, Alipay

China is a great example to understand how a particular payment method works. For obvious reasons, everything in the country is controlled by the Communist Party, and therefore services can get access to a huge user base, in which all electronic services are a closed system, tailored to China.

Alipay as a payment service by the marketplace Alibaba, WeChat Pay as an extension of the capabilities to the main messenger of the country — WeChat. They all implemented functional payment with a QR code. It’s an cheap to deploy, simple and clear infrastructure. All merchant needs to receive a payments is a piece of paper with a QR code. But what is the incentive for the customer to use the application to pay with a QR code? Tencent solved this question beautifully: they offered the opportunity to give each other money presents during the Chinese New Year — traditionally this was a cash procedure. The process has begun, and the business picked up the initiative. Now you can pay almost anything with a QR code in China. This is a universal system that made WeChat a second passport.

How does it work in Ukraine?

Now it’s unpopular — there are few applications, no one interacts with retail customers and therefore don’t see this as an option. Perhaps this will change soon, Masterpass has such a thing, it is very useful for fast payments.

Kenya — Mobile Money, M-PESA Wallet

Here the situation is different. Kenya, African country. Some stereotypes about it is still working: at the time of launch, M-PESA solved the problem of the almost complete lack of coverage of the country by ATMs and bank offices. How to withdraw money from the card, how to pay for services if there is no Internet banking, and cash can always be stolen because of the crime situation.

M-PESA used the existing infrastructure of the mobile network coverage. Payments for everything went through text messages, which were actively used for communication — this is a cheap infrastructure. “Mobile money” gave a payments guarantee and the fact that you were not be robbed — this is an active incentive to use.

How does it work in Ukraine?

Electronic wallets with mobile money in Ukraine is a non-banking alternative to financial services. We have mobile wallets enjoyed success — it is WebMoney, Qiwi, Yandex.Money and the quite successful project of Ukrainian MoneXy. The first are prohibited by law, the second is now dead, as well as the bank-launcher. Now this niche or bypass the state ban, or empty. For now.

India: a bit of everything

India is a large, extended, diverse country at the crossroads of cultures. Accordingly, M-PESA and QR payments from Alipay and PayTM work for them. This is an cheap infrastructure. The incentive is a bit like Kenya: it’s difficult to develop bank offices, ATMs, etc. outside of big cities. It’s much easier to use the mobile Internet for money transfers between balances and pay offline using QR codes.

And what about Ukraine?

Our domestic market is very interesting in the issue of the cashless payments deployment. Even unique.

  1. We have a huge network of payment cash-in kiosks, which are the most important payment method.
  2. There is Privatbank, which managed to deploy a huge network of ATMs and POS terminals throughout the country.
  3. Coverage of bank offices is also quite decent — at least among large banks.
  4. The emergence of Apple Pay and Google Pay has forced banks to upgrade POS terminals — with the prospect of full implementation of NFC by the end of 2019. There are no such rates in Europe.
  5. Huge volumes of mobile commerce from telecom operators — mobile payment is about 30% of all digital goods. Yes, and the electronic money is not opposed to return

All this means any way of the payment infrastructure development is suitable in Ukraine —everything is developed, the customers uses all the benefits. It’s difficult for business because competition is unreal. Therefore, the only way to reach success is a constant experiments and the creation of new incentives — because your competitor already earns old ones.

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