Oksana Korobkina, CCO at
Yandex.Money
tells Lakshay Aggarwal from Ken Research that The infrastructure
for non-cash payments is rapidly developing in Russia and POS-infrastructure is
now savvier in Russia than it is in Europe or the USA.
Yandex.Money is the market leader in
the Russia Payments Industry. What were the success factors throughout the journey,
that helped the company to attain this position?
Yandex.Money
initially started with the B2C Segment, around 17 years ago, when people didn’t
have much awareness about the non-cash modes of payment. We started working on
our E-Wallet and with the rapidly increasing awareness coupled with suitable
product, brand and efficient distribution we could establish ourselves as one
of the biggest players in the industry.
Yandex.Checkout, the B2B segment, was started around 6 years ago with the objective of facilitating easy collection of money for businesses. We have been successful in implementing the model owing to our easy to access platform backed by innovative API. We further plan to capitalize on growing small and medium enterprises by offering value added services to them.
I think
building the right set of products as per the needs and customer acceptance
helped us to reach where we are today.
In 2018, around 55% of the total
payment transactions were observed to be non-cash in nature. What contributed
from being highly cash dependent in early 2000’s to becoming cashless by 2018?
The infrastructure
for non-cash payments is rapidly developing in Russia and POS-infrastructure is
now savvier in Russia than it is in Europe or the USA. Also, number of cashless
transactions has grown 30 times from 2010 to 2018 - from 5.8 to 172 per year
per person and the overall volume of payments in the country has grown by an
average of 22.1%. I feel that mentality of the people and the spending patterns
of consumers have also changed from being cash dominated to cashless. Although the
transition was slow earlier, people are now realizing the benefits of non-cash
payments. Another fear in the minds of people used to be regarding the security
of non-cash transactions, which is getting removed gradually.
Does the industry face
any challenges from the regulatory side?
In fact,
the government and authorities are emphasizing on the need to go
digital/cashless. Few years back, NSPC and MIR cards were introduced in the
industry. Recently, direct debit facility was also supported by the
authorities.
Is there any direct involvement of Yandex
in POS and ATM Terminals segment of Russia? Owing to the high growth estimated
in these segments, are there any plans on venturing into the underdeveloped
space?
We are
currently involved through our partners which in total accounts for the largest
network of terminals. That allows our users to top-up their accounts and pay for
their purchases in offline stores. Our merchants who utilize Yandex.Checkout
have automatic access to 250K payment points.
The usage of digital payment
channels for small value transactions is on the rise. Our analysis show that the
average value of an e-money transaction has decreased from RUB 1,112.2 in 2013
to RUB 734.6 in 2018. How is it going to affect the revenue of Yandex.Money in
the coming years?
While the
Russian market grows approximately 30% per year, Yandex.Checkout develops twice
faster and over the last two years our turnover has doubled. Thus, a decrease
in the transaction value at the growing market value indicates an increase in
number of transactions. That leads to the demand for boosting capacity (at the
moment we can operate up to 600 transactions per second) and providing new and
superior products and services, which is exactly what we are working on and what
we are positive about.
The rise of tokenization system of
payments including Apple Pay, Google Pay and others have changed the industry
dynamics from e-wallets to contactless payments. How do you think is it going
to impact the industry?
It is the
trend we support and develop within our B2C and B2B services. Yandex.Money as a
B2C solution also issues its own bank cards which fully support contactless
payments. The number of payments via Apple Pay, Google Pay, Samsung Pay, and
Garmin Pay made with Yandex.Money cards have increased 2.5 times over the last
year, while the turnover has increased 3.1 times. Yandex.Money users can also
pay contactless with a Smartphone using the service’s own app: the number of
such payments has increased 2.9 times over the past year; the turnover has
increased 2.5 times. On the other hand, Yandex.Checkout as a PSP surely
involves contactless methods for accepting payments.
What do you think would be the
biggest asset for Yandex? Is it the data /revenue /strategic partnerships or high
market penetration?
It would
be difficult to single out a particular asset. I think all of them together
contribute to our growing business.
“The interview was conducted as a
part of the research for assessing the current scenario and future prospects of
the Russia Payment Services Industry.”
About Yandex: Yandex.Money is the most
popular online payment service in Russia, according to a 2019 survey by
Mediascope. The company is the joint venture of search engine Yandex (NASDAQ:
YNDX), and Sberbank. Yandex.Money offers consumers easy, safe, and reliable
methods of paying online on its own site and mobile app. The service hosts
about 60M user accounts and has around 120k registered merchants on its PSP,
Yandex.Checkout.
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Contact
Us:-
Ken Research
Ankur Gupta, Head Marketing & Communications
ankur@kenresearch.com
+91-9015378249
Ken Research
Ankur Gupta, Head Marketing & Communications
ankur@kenresearch.com
+91-9015378249
