Around 25 fintech companies providing services in Azerbaijan's financial market

By Azernews

By Ayya Lmahamad

A total of 25 fintech companies are providing services in the finance market of Azerbaijan, FinTech Association of Azerbaijan Chairman Ruslan Talibov told “Fintech-ecosystem in Azerbaijan- today and tomorrow” event, Azernews reports.

Noting that 55.6 percent of them are stable and 44.4 percent are still developing, he emphasized that about 20 percent of these companies are international players.

“I believe that the adoption of a law on payment systems will accelerate their development, expand the number of fintech players, give access to payment tools and provide a number of other benefits,” he said.

Ruslan Talibov also added that fintech organizations need to create conditions for closer cooperation with banks.

Startup certificates

Addressing the event, Small and Medium Business Development Agency Deputy Board Chairman Samir Humbatov stated that the agency issued about 60 startup certificates over the past two years.

He underlined that it is planned to work out the issues of financing startup projects that received these certificates.

“Some startup creators have received a certificate and, unfortunately, don’t carry out the vigorous activities expected from them. Therefore, it’s necessary to create financing and lending tools,” he said.

Digital payments

The Central Bank is working on stimulating digital payments, the bank’s Executive Director Farid Osmanov said.

Noting that in 2021, a strategy for digital payments was adopted, based on which work is underway to develop these types of payments, he added that a law on payment systems is expected to be adopted in the near future, which will accelerate the development of electronic financial services.

“We are also working on a number of other regulations which will facilitate the development of financial services and their compliance with international standards,” he said.

He stated that the number of bank card payments has increased significantly in Azerbaijan, adding that there are 13 million cards there, of which 9 million are contactless.

“Cashless payments in the country’s total turnover account for about 41 percent, and we aim to increase the share of non-cash payments in the total turnover,” he said.

In addition, Farid Osmanov said that the bank is also working on a project which will help create synergy between fintech companies and banks, and develop open banking.

Moreover, he told reporters that Azerbaijan’s payment systems will be based on a license. He noted that the relevant decision was reflected in the bill “on payment services and systems”, which is still under consideration by various public agencies.

“The Central Bank is working on implementing comprehensive measures to expand non-cash payments and create a competitive environment. Once a draft motion enters into force, the CBA will control the activities of payment organizations, non-banking organizations, as well as intermediary services. Such an activity will be permitted and licensed, and these organizations will be subject to technological safety and regulation measures,” he said.

Global payment solutions

Visa launched Apple Pay and Google Pay cashless payment solutions in Azerbaijan in 2019, Regional Manager in Central Asia and Azerbaijan at Visa Nurlan Hajiyev said.

He noted that the launch of these cashless payment solutions became possible due to the launch of tokenization.

“Visa was confident that this would contribute to the launch of Apple Pay and Google Pay in Azerbaijan. Today a number of banks are continuing to work on this,” he said.

The regional manager added that Visa launched the cashless purchase of train tickets running on the Baku-Sumgait route.

“The relevant infrastructure has been installed at 14 stations of the Absheron Circular line. It's planned to expand this initiative to other routes,” he said.

Nurlan Hajiyev added that Visa plans to launch MTT (Mobility and Transport Transaction) in Azerbaijan, adding that this includes the implementation of tokenization in public transport.