State program to help increase level of non-cash payments

Implementation of Azerbaijan’s state program to expand digital payments for 2018-2020 will help increase the level of noncash payments to 34 percent.

This was stated by Head of the Central Bank of Azerbaijan (CBA) Elman Rustamov at a meeting organized by the American Chamber of Commerce in Azerbaijan (AmCham).

Digitalization is an important component of the dynamics of the global economy’s development, he said.

He noted that the state program approved last month to expand digital payments for 2018-2020 reflects all the main components of the development of a cash-free society.

“It’s no secret that we have been working on this issue for a long time. However, this time the approach is more strategic and fundamental. We also have other priority projects, including instant payments, a pilot blockchain. All of them, in general, provide an integrated approach and will serve the development of this function of the CBA, and their implementation will give impetus to both the development of the banking sector and business,” Rustamov added.

The state program to expand digital payments in 2018-2020 provides that by 2021 the annual volume of non-cash payments in the country will reach approximately 17 billion manats ($10 billion).

Implementation of the program will allow to increase the share of non-cash payments annually by 7 percent. According to the program, the share of cash payments in transactions carried out in the country’s economy will fall from 74 percent to 40 percent.

To speed up the implementation of the state program, three basic conditions and specific goals for each of them were defined. Creating a more supportive environment involves not only prohibiting regulations, but also the use of special incentive mechanisms.

The law “On non-cash payments” was adopted in order to strengthen accounting in the financial system, through the development of non-cash payments.

The law envisages a limit for cashing operations. Banks and postal operators will charge a simplified tax (1 percent of the sum) for cashing of means kept in bank accounts of legal entities and private entrepreneurs.