Coronavirus as an accelerator of non-cash payment in Ukraine

Coronavirus is the hottest topic of the recent days, and with the enforcement of quarantine, broad concern quickly developed into a panic traditional for our latitudes. We observe an entire range of phobias of Ukrainians and reactions to them: from mass purchase of buckwheat / sugar / pasta, emptying of pharmacies and aggression in public transport to the usual symptoms of the common cold.

It is clear that the quarantine first of all had a negative impact on the service sector: shopping and entertainment centers and cinemas are closed, retailers suffer losses, because everyone is sitting at home. However, there are some obvious growth points. It is not just about food delivery (although the three major players in this market are definitely prepared for a difficult but profitable March), but also about how fintech projects can and already reduce the spread of diseases due to cashless solutions.

1. Internet Acquiring

The payment service providers will be affected first (and have been already affected, on the basis of LeoGaming data). More and more people stay at home and bring up their offline habits to “home mode”. The already mentioned food order instead of going to the restaurant, ordering produce instead of trip to the supermarket. Rather than going to a concert or a cinema- gatherings at home watching Netflix. On the one hand, the turnover and number of customers will increase, on the other hand, the load on all online payment services will also increase. In conditions when many teams go on to the remote operation mode, it becomes more difficult to provide effective support. Those who will get the support mechanism right and ensure smooth performance will definitely consolidate or strengthen their positions in the payment market.

2. The growth of mobile and online banking

It seems to us that a walk to a bank branch in Ukraine has for a long time been an anachronism for one and all. Perhaps it is so in the information bubble of IT specialists and financiers, but the evidence is that many main banking transactions are still carried out in the cash desks. Do not believe? Just go to any bank during the lunch break. You will see a queue of people of various ages who are quietly standing in lines.
Coronavirus will make its own adjustments to all this: even all conservatives will begin to look out for the personal bank’s web account or mobile app. After all, it does not require to contact other people in a cramped room, as well as with a cashier who has been counting money from other people all day long. Here, human fears can be beneficial for successfully digitalized banks and online services in paying for utility and other top services among customers.

3. Cash-in payment kiosks

The most unobvious, but still justified conclusion for Ukrainian realities. You ask, why am I first talking about cash rejection, and now that terminals accepting the cache will be one of the growth points?
Very simple: one of the most popular services in terminals is replenishment of cards of Ukrainian banks. Terminals are available in stores, but you do not need a cashier to use them. Therefore, they will all work to support card payments — people will transfer free cash to a card in order to pay for everything they need.

CEO of the international payment system LEO, the shareholder of IBOX Bank