Additional services and privileges are making the trade and service sphere more attractive but, despite efforts from the state and banks, Belarusians still prefer to shop with cash. Several reasons may be behind the unpopularity of plastic banking cards, although our citizens’ conservatism is the major cause.
However, the Regional Manager for the VISA international payment system in Belarus, Igor Kovalev, notes that progress is evident. “Over the past year, use of our cards in the retail sector has risen by almost 50 percent,” he says, adding, “Belarusians have already realised that a card is a convenient means of payment. We are now trying to encourage people to use their cards rather than cash.” Although many people own cards, they tend not to use them; customers may only use a card once against every fifth or sixth cash transaction. Around the globe, others have faced the same dilemma of encouraging card use, with developing countries currently striving to make the change: the USA and Western Europe have long since chosen cards over cash.
Bankers consider that non-cash payments and growth in sales are links in a single chain, since non-cash payments offer a real competitive advantage for shops of all kinds. “It’s been proven that sellers using POS-terminals boost turnover, in comparison to their rivals using cash,” explains the Deputy Chairman of the BelSwissBank’s Board, Vitaly Ryabtsev. “A large number of serious trading outlets already offer non-cash payment to customers.”
Companies already using POS-terminals are also taking action to stimulate sales, since installing the necessary card-reading equipment is an expensive investment. Vitaly Laptenok, who heads the ‘Finance.tut.by’ project, says that popularising non-cash payments should contribute to co-branded banking products: bank cards issued jointly with another company. “Co-branded bank cards are profitable for the bank and its partner-company. They raise the volume of cards issued, expanding the number of customers. Meanwhile, the partner-company boosts sales. Customers usually benefit by receiving preferential terms from the partner-company,” explains the specialist.
The MT’s reference:
In Belarus, 24 banks (out of 31 operating on the market) have already issued cards. As of early October 2010, about 9m banking cards were circulating in the country.