A comprehensive overview of the cards, payments and consumer banking market in Russia.
As Russians increase their usage of bank cards and mobile payments, cash is starting to decline in the face of a fast-evolving payments ecosystem.
In January 2019, the central bank introduced the Faster Payments System, which will include QR-based functionality from 2021.
Mir Pay, a mobile payment solution for the domestic scheme, was also launched in 2019, a year in which more than a fifth of Russia's Visa payments took place via mobile device.
How Mir has transformed the market.
What is happening in e-commerce payments.
Why credit cards should be regarded as one of the most dynamic consumer finance sectors in Russia.
The drivers of credit card profitability.
Which regulatory developments are having the greatest impact on banks and consumers.
TABLE OF CONTENTS
Demographics and the economy
Russian cards market
Key retail banks and issuers
Acquiring and processing
Regulatory and other cards market information
Appendix I: Demographics and the economy
Appendix II: Payments environment
Appendix III: Cards market
Appendix IV: Mobile payments
Appendix V: Profit pool
Appendix VI: The networks
Appendix VII: Key retail banks and issuers
Appendix VIII: Acquiring and processing
Appendix IX: Online acquiring
Demographics and Economy
Moscow and Saint Petersburg have historically been the main focus of consumer credit and payment activities. The vast regions beyond the two biggest cities provide a largely untapped source of potential new clients for consumer finance providers.
The payment ecosystem is evolving fast with Russians using bank cards and mobile payments at an ever-increasing rate; use of cash is starting to decline, but still remains a very important method of payment for Russians.
There were about 2.7 million POS terminals installed in Russia at the end of 2019, an increase of 11% when compared with 2018.
According to Visa, over a fifth of its payments in Russia, were conducted via mobile device in 2019, whereas, in 2016, this method was virtually non-existent.
Credit cards continue to be an important revenue driver for Russian banks. According to Verisk Financial Research's profit pool model, growth in credit card outstandings has picked up following an 8% decline.
Credit card numbers have increased in Russia by 16% since 2014 to reach almost 37 million cards in issue as of the end of 2019. Russian consumers are increasingly using debit cards for payments. Networks and issuers have been promoting the use of debit cards for cashless payments in Russia.
Key Retail Banks and Issuers
Several foreign banks have scaled back their operations in Russia since the financial crisis to fund higher capital requirements in other locations, while home-grown, state-controlled giants such as Sberbank and VTB are ramping up their operations.
Acquiring and Processing
Russia's acquiring market is concentrated, with almost 70% of credit card acquired billed volume in the hands of a single player, Sberbank, which is also among the largest merchant acquirers in Europe.
Russian B2C e-commerce amounted to over $40 billion during 2019, corresponding to annual growth of over 13% in purchase volume.
Regulatory and Markets Information
By law, payments within Russia must now also be processed there. Most international payment systems operators working in Russia are already compliant with the law, having taken the necessary steps to involve the domestic payment infrastructure.
Central Bank of Russia
Credit Bank of Moscow
Credit Europe Bank
European Bank for Reconstruction and Development
Faster Payments System
Home Credit Finance Bank
National Bureau of Credit Histories
National Card Payment System
National Commercial Bank of Russia
Orient Express Bank
Russian Agricultural Bank
Russian Fintech Association
Russian Regional Development Bank
Russian Standard Bank
Unified Biometric System
Verisk financial reports include detailed market and competitor intelligence on payments cards, e-money, acquiring, retail banking, and consumer credit in Europe. Analysts use primary and secondary source data and conduct in-depth interviews with senior industry executives and finance experts.
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