Three conclusions from the statistics on contactless payments of Ukraine for the I quarter of 2019
Ukrainian state regulator published this week a detailed statistics of contactless payments in Ukraine for the first quarter of 2019. And, of course, I couldn’t skip the opportunity to disassemble it and convert gross indicators into a forecast of opportunities and prospects for the Ukrainian fintech market. This is already becoming a tradition for my blog — I dare to hope, useful and constructive one.
So, 3% of all amount of bank cards are already in Apple Pay and Google Pay wallets. Tokenized cards are popular among the audience, which some progressive media call “new middle class” — residents of large cities, up to 35 years old, working in large companies, often traveling. Such people reject cash as a concept — and it is wonderful that such a culture of active but conscious consumption appears and develops in Ukraine.
Infrastructure growth responds to user requests: over 80% of POS terminals support contactless payments. Not bad for «the poorest country in Europe», as Ukraine is called by some. Not everywhere in the EU we can observe such cashless.
All this formed full parity with cash and non-cash payments — 50%/50 % in terms of the number of transactions. And what does all this mean in terms of business prospects? First of all — the more interesting future expects us.
New international player in the payments market
No, this is not just another pray for the PayPal release in Ukraine — the urgency of it decreases every year, as the Ukrainian economy integrates into the global one. We have Payoneer, there is XOOM. But there is no single instrument of financial settlement with the EU. And should appear sooner or later.
China Union Pay and JCB enters Ukrainian market, Ukrainian payment systems from financial companies are becoming international (for example, our LEO International payment system). There are more and more connections, and therefore innovative companies are clearly eyeing in Ukraine — especially after the success of the first mobile bank.
Among the products relevant to Ukrainians, I would like to mention Revolut. It is used by many Ukrainians in Poland, they have similar ideology and approaches with Ukrainian Mono, and they work across the Eurozone.
On the other hand, looking at the success of Apple Pay, PayPal can really reconsider its policy towards Ukraine.
Further appearance of new products from Mastercard in Ukraine
Mastercard has a strong leadership in the number of cards (over 70%), and therefore the Ukrainian market is perfect for testing and announcing new features and payment solutions. I am sure that they will increasingly be associated with the daily habits of cardholders, as is the case with the metro payments and other public transport, money transfers, refueling services, etc. Mobile wallets really became game changers, and success can and should be expanded.
Transformation of all bank offices into the multi-functional ones
ATMs are becoming less relevant for customers, but for large banks this is a serious expensive part. The bank offices are the same story. The solution is obvious — ATMs will become both a place of cash-in and cash-out(ATM-kiosk). It’s more difficult with offices — they are relevant for an audience of 40, and there will be relevant for 10 years (at least). The number of offices are unlikely to be less, but their purpose will vary. All of them go to maximum automation, and live communication will obviously remain for premium banking — it is constantly growing in Ukraine year by year, despite the price of maintaining premium cards.