The Cards and Payments Industry in Russia: Emerging trends and opportunities to 2020

GlobalData’s "The Cards and Payments Industry in Russia: Emerging trends and opportunities to 2020" report provides detailed analysis of market trends in the Russian cards and payments industry. It provides values and volumes for a number of key performance indicators in the industry, including credit transfers, payment cards, cash, direct debits, and cheques during the review-period (2012-16e).

The report also analyzes various payment card markets operating in the industry, and provides detailed information on the number of cards in circulation, transaction values and volumes during the review-period and over the forecast-period (2016-20f). It also offers information on the country's competitive landscape, including the market shares of issuers and schemes.

The report brings together GlobalData’s research, modeling, and analysis expertise to allow banks and card issuers to identify segment dynamics and competitive advantages. The report also covers details of regulatory policy and recent changes in the regulatory structure.

The report provides top-level market analysis, information and insights into the Russian cards and payments industry, including –

– Current and forecast values for each market in the Russian cards and payments industry, including debit, and credit cards.

– Detailed insights into payment instruments including credit transfers, cash, cheques, direct debit, and payment cards. It also, includes an overview of the country's key alternative payment instruments.

– E-commerce market analysis and payment methods.

– Analysis of various market drivers and regulations governing the Russian cards and payments industry.

– Detailed analysis of strategies adopted by banks and other institutions to market debit, and credit cards.

Scope

– Alternative payments are gaining prominence in Russia with the launch of global payment solutions including Apple Pay, Android Pay, Samsung Pay, and Masterpass. Google launched Android Pay in Russia in May 2017. The solution enables users to make in-app, in-store, and online payments by storing debit, credit, loyalty, and gift cards on the wallet. The solution is now supported by 15 banks. Apple and Samsung previously launched their payment solutions Apple Pay and Samsung Pay in the country in October 2016. And in 2014, Mastercard launched the Masterpass digital wallet in Russia. Masterpass users can shop online without providing payment and shipping information with every purchase. The service allows merchants a faster and easier way to process payments, and helps decrease checkout abandon rates.

– To disrupt the debit card market, which is currently being dominated by international scheme providers Visa and Mastercard, the Russian government launched the Mir national payment card in December 2015 under the NPCS. 376 banks (including all of the country’s major banks) have joined the system and started to issue these cards. As of April 2017, more than 5 million Mir national payment cards had already been issued in the country. The escalating number of Mir cards is anticipated to pose serious competition to Visa and Mastercard in the long run.

– To provide acceptance of international cards in Russia, domestic merchant acquirers have entered into agreement with international schemes. For instance, the leading Russian acquirer Sberbank partnered with Chinese scheme UnionPay International in May 2017, allowing Asia Pacific and China tourists to make payments with UnionPay cards at Sberbank’s merchant network in Russia. In the same month, Sberbank entered into a similar agreement with JCB International to allow merchants to accept payments with JCB cards by 2018.

Reasons to buy

– Make strategic business decisions, using top-level historic and forecast market data, related to the Russian cards and payments industry and each market within it.

– Understand the key market trends and growth opportunities in the Russian cards and payments industry.

– Assess the competitive dynamics in the Russian cards and payments industry.

– Gain insights into marketing strategies used for various card types in Russia.

– Gain insights into key regulations governing the Russian cards and payments industry.

Companies mentioned

Sberbank

VTB24

Raiffeisen Bank

Russian Standard Bank

OTP Bank

Tinkoff Bank

Alfa-Bank

Global Payments

Gazprombank

Credit Europe Bank

Visa

Mastercard

Golden Crown

American Express

Table of Contents

Table of Contents

1. EXECUTIVE SUMMARY 2

1.1. Market overview 2

1.2. Key facts 4

1.3. Top five industry events 5

2. PAYMENT INSTRUMENTS 11

2.1. Current payment environment 11

3. E-COMMERCE AND ALTERNATIVE PAYMENTS 13

3.1. E-commerce market analysis 13

3.2. Alternative payment solutions 15

3.2.1. Yandex.Money 15

3.2.2. PayPal 15

3.2.3. Masterpass 16

3.2.4. Samsung Pay 16

3.2.5. Apple Pay 16

3.2.6. Android Pay 16

3.2.7. Visa Qiwi Wallet 16

3.2.8. MTS Money Wallet 17

3.2.9. WebMoney 17

3.2.10. Moneta 17

4. REGULATIONS IN THE CARDS AND PAYMENTS INDUSTRY 18

4.1. Regulatory framework 18

4.1.1. Minimum authorized and equity capital requirement 18

4.1.2. Rules pertaining to foreign participation 18

4.1.3. Capital adequacy requirements 18

4.2. Anti-money laundering 19

4.3. Foreign direct investment regulations 19

5. ANALYSIS OF CARDS AND PAYMENTS INDUSTRY DRIVERS 21

6. PAYMENT CARDS 24

7. DEBIT CARDS 26

7.1. Debit card market analysis 26

7.2. Competition in the debit card market 28

7.3. Debit cards comparison 30

8. PAY-LATER CARDS 31

8.1. Pay-later card market analysis 31

8.2. Competition in the pay-later card market 33

8.3. Pay-later card comparison 35

9. PREPAID CARDS 36

10. MERCHANT ACQUIRING 38

11. APPENDIX 41

11.1. Abbreviations and acronyms 41

11.2. Supplementary data 42

11.3. Definitions 52

11.4. Methodology 54

11.5. Bibliography 56

11.6. Further reading 56

List of Tables

List of Tables

Table 1: Russia: key facts, 2016 4

Table 2: Regional benchmarking of payment cards, 2016 4

Table 3: Russia: mode of entry of foreign banks 20

Table 4: Russia: debit card comparison and key features, 2017 30

Table 5: Russia: gold credit card comparison and key features, 2017 35

Table 6: Russia: premium credit card comparison and key features, 2017 35

Table 7: Russia: payment instrument transaction values (RUBbn), 2012-16e 42

Table 8: Russia: payment instrument transaction values ($m), 2012-16e 42

Table 9: Russia: payment instrument transaction volumes (million), 2012-16e 42

Table 10: Russia: payment cards in circulation by type (million), 2012-20f 42

Table 11: Russia: volume of payment card transactions (million), 2012-20f 43

Table 12: Russia: value of payment card transactions (RUBbn), 2012-20f 43

Table 13: Russia: value of payment card transactions ($bn), 2012-20f 43

Table 14: Russia: debit cards in circulation (million), 2012-20f 43

Table 15: Russia: debit card transaction volumes, 2012-20f 43

Table 16: Russia: debit card transaction values (RUB), 2012-20f 44

Table 17: Russia: debit card transaction values ($), 2012-20f 44

Table 18: Russia: debit cards in circulation by scheme (million), 2012-16e 44

Table 19: Russia: debit card transaction values by scheme (RUBtn), 2012-16e 44

Table 20: Russia: debit card transaction values by scheme ($bn), 2012-16e 45

Table 21: Russia: debit card transaction values by issuer (RUBbn), 2012-16e 45

Table 22: Russia: debit card transaction values by issuer ($bn), 2012-16e 45

Table 23: Russia: pay-later cards in circulation (million), 2012-20f 46

Table 24: Russia: pay-later card transaction volumes, 2012-20f 46

Table 25: Russia: pay-later card transaction values (RUB), 2012-20f 46

Table 26: Russia: pay-later card transaction values ($), 2012-20f 46

Table 27: Russia: pay-later cards in circulation by scheme (million), 2012-16e 47

Table 28: Russia: pay-later card transaction values by scheme (RUBbn), 2012-16e 47

Table 29: Russia: pay-later card transaction values by scheme ($bn), 2012-16e 47

Table 30: Russia: pay-later card transaction values by issuer (RUBbn), 2012-16e 47

Table 31: Russia: pay-later card transaction values by issuer ($bn), 2012-16e 48

Table 32: Russia: prepaid cards in circulation (million), 2012-20f 48

Table 33: Russia: prepaid card transaction values (RUBbn), 2012-20f 48

Table 34: Russia: prepaid card transaction values ($bn), 2012-20f 48

Table 35: Russia: merchant acquiring transaction volumes (million), 2012-20f 48

Table 36: Russia: merchant acquiring transaction values (RUBbn), 2012-20f 49

Table 37: Russia: merchant acquiring transaction values ($bn), 2012-20f 49

Table 38: Russia: acquirers’ transaction volumes (million), 2012-16e 49

Table 39: Russia: acquirers’ transaction values (RUBbn), 2012-16e 49

Table 40: Russia: acquirers’ transaction values ($bn), 2012-16e 50

Table 41: Russia: retail outlets and card-accepting merchants (000s), 2012-20f 50

Table 42: Russia: debit card average interchange fees (%), 2012-16e 50

Table 43: Russia: debit card merchant service charge and interchange fee (%), 2012-20f 50

Table 44: Russia: pay-later card average interchange fees (%), 2012-16e 50

Table 45: Russia: pay-later card merchant service charge and interchange fee (%), 2012-20f 51

Table 46: Key definitions 52

List of Figures

List of Figures

Figure 1: Russia: payment instrument shares by transaction value (%), 2012 vs 2016 11

Figure 2: Russia: payment instrument shares by transaction volume (%), 2012 vs 2016 12

Figure 3: Russia: e-commerce value 13

Figure 4: Russia: population and economic indicators 21

Figure 5: Russia: number of ATMs, POS terminals, and real household consumption 22

Figure 6: Russia: payment card transaction value and cards in circulation, 2012-20f 24

Figure 7: Russia: debit card penetration and turnover per card 26

Figure 8: Russia: debit card scheme and issuer transaction value share (%), 2016 28

Figure 9: Russia: pay-later card penetration and turnover per card 31

Figure 10: Russia: pay-later card scheme and issuer transaction value share (%), 2016 33

Figure 11: Russia: prepaid cards in circulation (million) and transaction value ($m), 2012-20f 36

Figure 12: Russia: merchant acquiring transaction volume and value, 2012-20f 38

Figure 13: Russia: acquirers’ market share in terms of transaction volume and value (%), 2016 39

Figure 14: Russia: average merchant service charge and interchange fee (%), 2012-20f 40

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