ArmInfo.For the first time in the years of formation and development of the bankcard market in Armenia, following the results of 9 months of this year, the volume of non-cash bankcard transactions exceeded the volume of cash transactions.
According to the Central Bank data, 50.3% of card transactions were non-cash ones (2.3 trillion drams ($5.7 billion)), while a year ago this level was about 38%. Moreover, the y-o-y growth rate of the volume of non-cash transactions accelerated from 63.3% to 2-fold.
According to market analysts, the rapid growth of non-cash transactions was due to the update of the RA Law "On Non-Cash Payments", which obligated to make relatively large payments in non-cash form from July 1, 2022.
It is worth noting that in non-cash transactions, 54% or over 1.2 trillion drams ($3.1 billion) were carried out through virtual Terminals- vPOSes, with an acceleration of y-o-y volume growth from 50.4% to 91%. In the total volume of plastic transactions, the share of transactions through vPOS already exceeds 27%. Such an increase in non-cash transactions supported the high growth rate of the total volume of plastic transactions at the level of 49%, as a result of which, based on the results of 9 months of this year, 4.5 trillion drams or $11.4 billion were reached (including transactions abroad with cards issued by Armenian banks).
Moreover, the volume of transactions carried out abroad with cards issued by Armenian banks, as in the previous year, increased 2-fold, amounting to 518.5 billion drams or 1.3 billion dollars, which is almost 12% of the total plastic transactions.
In terms of cards, the volume of plastic transactions showed high growth for Visa and other international cards and moderate growth for MasterCard and local ArCa. The leadership in terms of transaction volume is held by Visa cards - 2.6 trillion drams for 9 months of 2023, with y-o-y growth accelerating from 23.1% to 62.6%. MasterCard cards took second place - 1.2 trillion drams, with growth accelerating from 20.8% to 38.8%. Local ArCa cards are in 3rd place - 614.8 billion drams, with growth accelerating from 23.2% to 28.7%. And the 4th place is taken by foreign cards (HSBC cards, AmEx, Diners Club, and MIR cards) - 131.7 billion drams, with a sharp acceleration in the growth rate from 21.5% to 72.6%,which, according to the data available to ArmInfo, mainly derived from MIR cards, issued by VTB Bank Armenia since July 2022, having managed to issue over 50 thousand in six months, and then impressively increasing their number.
In terms of the share in the total volume of plastic transactions, Visa cards hold the lead - 57.7% (compared to 54% a year earlier), MasterCard is in second place - 25.7% (compared to 27.5% a year earlier), ArCa is in third place with 13.7% (versus 16% a year earlier), and the remaining 2.9% (versus 2.5% a year earlier) are transactions with other foreign cards.
Visa cards also remain dominant in the total number of cards - 46.3% (as in the previous year), followed by MasterCard - 23.8% (versus 24.1% a year earlier), ArCa - 23.4% (versus 23. 8% a year earlier), and the remaining 6.5% (versus 5.8% a year earlier) are other foreign cards (HSBC cards, AmEx, Diners Club, and since July 2022 MIR cards). In terms of y-o-y growth in the number of cards, the highest rate, as in the case of transactions, was shown during the reporting period by foreign cards - 32.2%, Visa and Mastercard international cards have increased in numbers almost equally - by 17.4% and 16%, respectively, and the local ArCa cards reached approximately the same growth - 15.3%. In total, by October 1, 2023, there were over 3.578 million cards, the number of which increased by 17.4% year-on-year.
According to the updated RA Law "On Non-Cash Payments", from July 2022, transactions exceeding 300 thousand drams are carried out in a non-cash manner in the territory of the republic. In addition, for certain transactions, such as scholarships, government procurement, payments for medical, educational, notary, lawyer, including consulting services, the requirement to make them completely cashless has come into force. Wages and loans provided by banks and credit companies have become non-cash. Loan repayments and insurance payments also began to be made by bank transfer. At the same time, a state cash-back program was launched for pensioners and people receiving benefits in the amount of 10% (but not more than 5,000 drams) when paying for purchases or services in non-cash form, including utility bills. Out of 18 banks operating in Armenia, 17 operate in the plastic market. The new 18th bank, Fast Bank, plans to enter the card market in the coming months, with the simultaneous issuance of international Visa and MasterCard cards.
