During the era of digital innovations, global financial management has undergone significant transformation, as the share of cashless payment systems in the market continues to increase. Strategically positioned between Europe and Asia, Azerbaijan has experienced significant changes in payment preferences during the years 2022 and 2023. This article sheds light on Azerbaijan's transition towards a more digital economy by examining information about cash and cashless payments during this period.
In 2022, card payments within Azerbaijan amounted to 55.980 million manats domestically. Cash payments accounted for 31.787 million manats, representing approximately 56.8% of the total amount. Cashless payments during this period amounted to 24.192 million manats, accounting for 43.2% of the total. It should be noted that a significant portion of these cashless payments were made through ATMs and POS terminals.
In 2022, within the country, cashless payments made through POS terminals amounted to 5.803 billion manats, and electronic commerce accounted for 18.348 million manats. This represents a distribution of 24% (POS) and 76% (e-commerce) in terms of the respective amounts. This statistics highlights the increasing acceptance of cashless transactions among Azerbaijani consumers, with the majority of these transactions taking place through POS terminals and e-commerce platforms, indicating a shift towards digital payment methods.
Comparing with the previous year, advancements in card payments within Azerbaijan are observed in 2023. The total value of domestic card payments has increased, reaching 17.556 million manats in the first quarter, indicating a significant growth in the country's digital payment ecosystem.
In the first three months of 2023, cashless payments made through POS terminals amounted to 2.017 million manats, while e-commerce accounted for 6.934 million manats. This represents a distribution of 22.5% (POS) and 77.5% (e-commerce) in terms of the respective amounts This statistics highlights the increasing acceptance of cashless transactions among Azerbaijani consumers, with the majority of these transactions taking place through POS terminals and e-commerce platforms, indicating a shift towards digital payment methods.
It is worth mentioning that, compared to the first three months of 2022, we observe a 70% increase in POS terminal payments and a 118% increase in e-commerce payments within the country.
Cashless payments have significantly increased in Azerbaijan over the course of a year. The number of cashless transactions rose from 84.189 million in the first three months of 2022 to an impressive 179.287 million in the same period of 2023. This notable increase has also directly impacted e-commerce, with the number of domestic transactions rising from 55.672 million in 2022 to 101.535 million in 2023 during the same period. The rapid adoption of digital payments in Azerbaijan is contributing to the growth of e-commerce.
Although cash payments still hold a significant share in Azerbaijan between 2022 and 2023, the continuous growth of cashless transactions indicates the increasing adoption of digital payment methods by both institutions and individuals. The transition to cashless payments offers numerous advantages, including convenience, security, and enhanced transparency. Additionally, it contributes to the overall efficiency of the economy by reducing the costs associated with managing and handling cash.
Looking into the future, Azerbaijan is rapidly transitioning to cashless payments. Technological advancements and improved infrastructure will further accelerate the adoption of digital payment solutions.
The major contributor to this transition is Epoint, a platform created for the provision of electronic commerce services. Now, anyone can complete online registration within 3 minutes, sign contracts with ASAN İmza, and present their products and services online, accepting payments in an online manner. Regardless of the bank, individuals can add their business cards from any bank and start accepting payments. Looking at Epoint's financial indicators, it has processed a circulation of 21 million manats and over 300,000 transactions from last year to the present day. Additionally, it has over 400 B2B customers.
* The data in the report was obtained from the central bank's website.
** When using the information mentioned in the article fully or partially on other websites, the source of the article should be cited as a link to the news on the epoint.az website.