The total number of payment cards issued by Ukrainian banks exceeded 115 million – banker
7 May 2024 15:09
The total number of payment cards issued by Ukrainian banks has exceeded 115 million, which is an average of 3 cards for each adult citizen of the country. This was reported to Komersant ukrainskyi 
by Anna Dovgalska, Deputy Chairman of the Board of GLOBUS BANK.
Referring to the NBU data, she noted that in the total number of payment cards, more than 45.3% are cards for spending transactions (more than 52 million) and in 2023, compared to last year, their number increased by 12.5%. In addition, according to the expert, the number of contactless cards has changed significantly: from December 2022 to December 2023, their number increased by 17% to 30.6 million, so almost 59% of active cards are contactless .
The popularity of tokenised payment cards (NFC technology) is growing:
- from December 2022 to December 2023, their number increased by 57% to 12.4 million (i.e. approximately one in four active payment cards is tokenised).
“By the end of 2023, almost 90% of the total number and amount of non-cash transactions in Ukrainian retail chains were made using contactless payment and NFC technology,” the banker emphasised.
The expert noted that international payment systems MasterCard and Visa are still the leaders in terms of payment card transactions. Thus, in 2023, the share of transactions with cards of these systems was 99.9% of the total number of transactions (7,912.5 million) and 99.5% of the total amount of transactions (UAH 6,140.8 billion).
Anna Dovgalska noted that in 2023, thelargest number of payment card transactions was for payments in the retail network – almost 70% (about 5 billion transactions). At the same time, card-to-card transfers are the leaders in terms of transaction amounts – 37.1% (or UAH 1,478.6 billion).
“It can be assumed that the payment infrastructure and card issuance will continue to grow, which means that customers will continue to actively make card-to-card transfers (p2p transfers),” the expert said.
Anna Dovgalska pointed out the main factors that encourage banks to actively develop payment cards. In particular, these are:
- Increased demand: the popularity of cashless payments and online shopping is increasing the demand for payment cards among consumers.
- Competition in the financial services market: in order to attract new customers and retain existing ones, banks must actively develop new products and services, among which payment cards play a key role.
- Convenience and speed of payments.
- Fee income from transaction processing, i.e. card development, is a potential source of profit for banks.
- Technological progress and the introduction of innovations in the payment segment, such as NFC technology.
According to her forecast, the trend towards active development of payment cards will continue in 2024. She expects the total number of cards to grow by an average of 5-7% to 120-123 million by the end of the year.
“Payment cards are an important component of the development of banking services and products. For several years, Ukraine has been playing a leading role in the development and implementation of technological innovations. That is why we can predict that in the near future the payment card segment as the most common “form” of communication between citizens and commercial banks will actively develop. At the same time, we expect banks to become more competitive for customers, which may make card issuance even more profitable for consumers,” she said.
However, as the popularity of card instruments grows, so does card fraud . Accordingly, the security system of financial institutions must be at the highest level.
The expert focused on the main ways to avoid card fraud. According to her, banks are currently actively implementing technologies to protect their customers and against illegal actions of criminals. Thus, the most effective ways to combat fraud are:
A separate SIM card for financial accounts
It is better to use a separate SIM card for financial transactions and not disclose its number to anyone. Customers should contact their mobile operator to link the number to their passport or switch to a contract. This can be done in the mobile operator’s salon or online using a qualified electronic signature (QES). This way, criminals won’t be able to make a duplicate without the client’s knowledge.
Opening a virtual payment card
The expert suggests that you issue a payment card in online banking to use it for online purchases. The advantage of a virtual card is that it cannot be stolen. Even if fraudsters find out the card details, they are unlikely to be able to debit the card, because they won’t be there.
Set limits on payments in online stores, cash withdrawals, and money transfers.
Strong passwords
The most reliable ways to protect against payment card fraud include setting passwords for cards, online banking and email. Each bank card or system should have its own password, which is recommended to be changed quarterly.
“The simplest advice and the most important one at the same time: to feel completely safe, you should not disclose your PIN or login passwords, especially not to write them down in your smartphone or on a piece of paper folded in your wallet. Card payments are fast and convenient, but you should always be vigilant and take care of your own safety,” the banker advises.
Anna Dovgalska also touched upon the resonant issue of the possibility of completely abandoning “paper” money and switching to 100 per cent cashless payments. In her opinion, such a “transition” is unlikely in the future, although the share of card payments will continue to grow.
“A certain reduction in the share of cash payments is primarily beneficial to the country’s economy. In this case, the money remains in the banking system, which leads to lower interest rates on loans. In other words, there is a connection: the more non-cash payments, the cheaper the money in banks and the cheaper the loans,” she said.
The expert believes that no country in the world is able to completely abandon cash, as such a transition has both advantages and disadvantages. In her opinion, the main advantages of the cashless economy are the release of banking efforts for storage, security, logistics, and protection against counterfeiting. But the most important are security, transparency of payments and increased tax revenues to the budget, because, as the banker emphasises, the absence of cash would automatically lead to the disappearance of salaries in envelopes, and thus the number of tax evaders would be significantly reduced.
“It’s no secret that coins and paper notes, unlike electronic money, do not need electricity, the Internet or a charged power bank. And the first days of the military aggression convinced us that, at least in times of force majeure, the best solution is to have both a card and cash with you. We must admit that a complete rejection of cash in Ukraine today is technically unrealistic, as there is neither economic nor infrastructural readiness for this. In order for the whole country to switch to cashless payments, we must at least have 4G internet in the most remote village,” Anna Dovgalska concluded.
For reference:
JOINT STOCKCOMPANY “COMMERCIAL BANK GLOBUS” (GLOBUS BANK) was founded in 2007.
As of April 2024, the regional network comprised 31 branches. All branches of the bank are part of the united Power Banking network, which allows them to operate in the absence of electricity.
