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Quarantine restrictions stimulated the growth of cashless payments in 2020

16/ 03/ 2021
  In early March, the NBU released statistics on cashless market trends for 2020. The figures confirmed the expectations: the payment behavior of individuals and businesses has changed towards more active use of non-cash payments under the influence of quarantine restrictions as a new condition. Since the beginning of the pandemic in March last year, the Ministry of Health, and later the NBU, advised to limit contacts with paper banknotes and coins, and give preference to non-cash payments. At the same time, the NBU has developed a number of measures to reduce the risk of spreading coronavirus infection COVID-19 during cash transactions. According to the NBU, the number of institutions that accept payment cards increased in 2020 by 36.1%.%, and this trend will continue in 2021.. It is worth noting that almost 87% of payment card transactions in 2020 were cashless. During this year, Ukrainians have become accustomed to a new way of buying goods and services. At the same time, there are no economic or social incentives for the reverse process – moving to cash payments. Victoria Burdeina. EBA Electronics Payment Committee Coordinator. However, the pandemic is not the only reason. The increase in the share of non-cash payments is a trend of the last few years, which was accelerated in 2020. In 2019, for example, this figure already amounted to 82.4%. At the same time, Valeria Bondarenko, managing partner of Fondy, EBA Electronics Payment Committee member, stressed: Valeria Bondarenko. Managing partner of Fondy. In 2020, every third non-cash transaction with a payment card was carried out on the Internet (36.5%) which is equivalent to almost 642 billion hryvnias a year. In total, the volume of online payments has tripled in the last five years: in 2015 it amounted to UAH 203 billion. The main driver of the card transactions growth is that ever more stores and service companies provide their customers with the possibility to pay with the card. According to the NBU, the number of institutions that accept payment cards increased by 36.1% over the year. At the same time, we saw that banks have done a great job of providing convenient and attractive Internet banking services, as well as providing a high level of protection for payers when conducting transactions online. The business, for its part, has made every effort to provide the opportunity to pay by card at points of offline sales, as well as to make purchases of goods and services online. As a result, Ukrainians are convinced that card payments can be convenient, fast, and secure. This is confirmed by the growing trend of online payments. In 2020, in particular, payments increased in such segments as food delivery; purchase of sports equipment; online education - workshops, courses, seminars; children goods. Vira Platonova. Senior Vice President SEE CIS Visa Inc. Among the factors that have contributed to the development of cashless payment services are the progressive approaches to regulation which currently take place in Ukraine. Such regulation has enabled the cashless and digital payments industry to grow, which is critical to ensuring financial inclusion, building the country′s digital economy and infrastructure, and reducing the shadow economy. It should be noted that, according to the NBU, the total amount of transactions on the Internet in 2020 increased to 641.6 billion UAH vs 337.2 billion UAH in 2019. It means that the Ukrainian consumer overcomes the barrier of distrust in e-commerce and is ready to pay online not only more often (1900.8 million transactions against 727.9 in 2019), but also to spend larger amounts. Living under quarantine restrictions did not leave room for maneuver even for that percentage of Ukrainians who did not trust online shopping and e-payments. People who have never made a purchase or paid for services online did so for the first time in 2020. Those who were apprehensive about online payments overcame their mistrust by choosing trusted stores and paying through well-known payment systems. They started with their own safety during a pandemic and suddenly found it easier to make payments that way. The financial sector also had to undergo the restructure. Banks must recognize that there is no need in the client’s personal presence to conduct their identification, open an account, provide them with a service. Today you can and should translate the communication with customers online. This has given and will give in the near future a great impetus to the development of remote identification services, mobile banking, etc. Konstantin Lezhnin. Deputy Chairman, Ukrsibbank BNP Paribas. Cashless payments have excellent growth prospects. According to the NBU strategy for the development of the financial sector until 2025, the ratio of cash to GDP should be reduced by 2 times. This means that the share of non-cash payments will grow. Banks are the main investors in Ukraine′s payment infrastructure. Business welcomes the trend of increasing non-cash payments and hopes that it will only intensify. Thus, one of the priorities of the EBA Electronics Payment Committee in 2021 is to promote the introduction of innovative technological solutions in the field of non-cash payments, to improve business conditions for market participants and increase the convenience of electronic payment services for users, which, in turn, will help maintain the trend of further growth of cashless payments.   Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.

In early March, the NBU released statistics on cashless market trends for 2020. The figures confirmed the expectations: the payment behavior of individuals and businesses has changed towards more active use of non-cash payments under the influence of quarantine restrictions as a new condition. Since the beginning of the pandemic in March last year, the Ministry of Health, and later the NBU, advised to limit contacts with paper banknotes and coins, and give preference to non-cash payments. At the same time, the NBU has developed a number of measures to reduce the risk of spreading coronavirus infection COVID-19 during cash transactions.

According to the NBU, the number of institutions that accept payment cards increased in 2020 by 36.1%.%, and this trend will continue in 2021.. It is worth noting that almost 87% of payment card transactions in 2020 were cashless.

During this year, Ukrainians have become accustomed to a new way of buying goods and services. At the same time, there are no economic or social incentives for the reverse process – moving to cash payments.

Victoria Burdeina EBA Electronics Payment Committee Coordinator
However, the pandemic is not the only reason. The increase in the share of non-cash payments is a trend of the last few years, which was accelerated in 2020. In 2019, for example, this figure already amounted to 82.4%.

At the same time, Valeria Bondarenko, managing partner of Fondy, EBA Electronics Payment Committee member, stressed:

Valeria Bondarenko Managing partner of Fondy
In 2020, every third non-cash transaction with a payment card was carried out on the Internet (36.5%) which is equivalent to almost 642 billion hryvnias a year. In total, the volume of online payments has tripled in the last five years: in 2015 it amounted to UAH 203 billion. The main driver of the card transactions growth is that ever more stores and service companies provide their customers with the possibility to pay with the card. According to the NBU, the number of institutions that accept payment cards increased by 36.1% over the year. At the same time, we saw that banks have done a great job of providing convenient and attractive Internet banking services, as well as providing a high level of protection for payers when conducting transactions online. The business, for its part, has made every effort to provide the opportunity to pay by card at points of offline sales, as well as to make purchases of goods and services online. As a result, Ukrainians are convinced that card payments can be convenient, fast, and secure. This is confirmed by the growing trend of online payments. In 2020, in particular, payments increased in such segments as food delivery; purchase of sports equipment; online education - workshops, courses, seminars; children goods.
Vira Platonova Senior Vice President SEE CIS Visa Inc
Among the factors that have contributed to the development of cashless payment services are the progressive approaches to regulation which currently take place in Ukraine. Such regulation has enabled the cashless and digital payments industry to grow, which is critical to ensuring financial inclusion, building the country′s digital economy and infrastructure, and reducing the shadow economy.

It should be noted that, according to the NBU, the total amount of transactions on the Internet in 2020 increased to 641.6 billion UAH vs 337.2 billion UAH in 2019. It means that the Ukrainian consumer overcomes the barrier of distrust in e-commerce and is ready to pay online not only more often (1900.8 million transactions against 727.9 in 2019), but also to spend larger amounts. Living under quarantine restrictions did not leave room for maneuver even for that percentage of Ukrainians who did not trust online shopping and e-payments. People who have never made a purchase or paid for services online did so for the first time in 2020. Those who were apprehensive about online payments overcame their mistrust by choosing trusted stores and paying through well-known payment systems. They started with their own safety during a pandemic and suddenly found it easier to make payments that way.

The financial sector also had to undergo the restructure. Banks must recognize that there is no need in the client’s personal presence to conduct their identification, open an account, provide them with a service. Today you can and should translate the communication with customers online. This has given and will give in the near future a great impetus to the development of remote identification services, mobile banking, etc.

Konstantin Lezhnin Deputy Chairman, Ukrsibbank BNP Paribas
Cashless payments have excellent growth prospects. According to the NBU strategy for the development of the financial sector until 2025, the ratio of cash to GDP should be reduced by 2 times. This means that the share of non-cash payments will grow. Banks are the main investors in Ukraine′s payment infrastructure.

Business welcomes the trend of increasing non-cash payments and hopes that it will only intensify. Thus, one of the priorities of the EBA Electronics Payment Committee in 2021 is to promote the introduction of innovative technological solutions in the field of non-cash payments, to improve business conditions for market participants and increase the convenience of electronic payment services for users, which, in turn, will help maintain the trend of further growth of cashless payments.

 

Be the first to learn about the latest EBA news with our Telegram-channel EBAUkraine.

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