Kuban Residents Get Out of Habit of Paying Cash

Krasnodar, 4 February. 16+ In January – October 2020, the number of cashless transactions with bankcards in Russia exceeded 1.7 billion, which was by 39% more than in the same period of the previous year. Krasnodar krai topped the list of regions on the share of cashless payments in the total amount of bankcard operations (89.5%), followed by Volgograd (88.5%) and Rostov (87.9%) oblasts. 

According to the Ural Bank for Reconstruction and Development, the share of cashless transactions with the use of the Bank’s cards grew in the second half of 2020 by 6–7%, compared with the figures of 2019. It has of late become a tendency toward increasing the share of cashless payments approximately by 5–7% every year. At the same time, the total volume of cashless transactions of the MTS Bank in Krasnodar krai grew by 45%, and the volume of money used for these transactions increased by 47% last year. 

OTP Bank analysts also proved the fact that Kuban residents got used to more frequently paying for goods and services with bankcards than cash. During the third quarter of the year, the number of transactions using credit cards nearly doubled compared with 2019. 

Alongside cashless payments, the number of online sales also grew up, mainly due to the pandemic. Since the beginning of the quarantine, the demand for them increased by 4.3 times. At the same time, the quantity of Internet shop customers boomed. It happened because people changed their attitude to online sales – their confidence in them was growing. Besides, customers more often tended to pay for purchases using mobile devices, without a physical bankcard. According to Raiffeisenbank, an average receipt for a transaction paid with the help of Apple Pay, Google Pay, XiaoMi Pay, etc. grew by 14%. 

“After the first wave of the pandemic, Kuban residents began to more actively apply for credits,” Tatiana Nachinova, Retail Business Development Director of Raiffeisenbank’s Centre Macroregion, commented. 

“Our bank’s survey carried out last August showed that a third of the borrowers applied for credits when the constraints had been lifted; a third of them planned to take a consumer loan by the end of the year. These plans reflected on the number of applications. In the autumn of 2020, the number of credit applications was by 55% higher than in the autumn of 2019.” 

\Yelena Retunskaya, South Division Director of the Ural Bank for Reconstruction and Development, believes that “the demand [for credit cards] lowered due to the changed customer behaviour, whose attitude to credit products in the situation of instability and decline in income due to the pandemic became more serious, while the banks’ requirements to their borrowers also changed – banks wanted less risks with regard to their product portfolio. Besides, competition for customers between banks also increased.” 

It is noteworthy that the peak of the demand for the Ural Bank’s credit cards was in January – February 2020, when the figures were similar to those shown in 2019. The fewest number of credit cards were issued in April – May 2020. 

Despite growing occurrences of the use of bankcards and cashless payments, the volume of cash also rose up. According to the Bank of Russia, the amount of the cash money circulating in the country as on January 1, 2021 was 13.4 trillion roubles, which was by 2.8 trillion roubles more than a year before. The peak of the growth occurred in the second quarter of the year, when the coronavirus constraints were introduced – then it equalled to 1.2 trillion roubles. Such demand was caused by people’s wish to hoard up money not to visit banks if they could help it. In the total number of banknotes, the shares of large bills increased: of 5,000-rouble bills from 26 up to 31%, and of 2,000-rouble banknotes from 4 to 5%.

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