To develop non-cash payments in Armenia it is necessary to expand the cards’ service infrastructure.
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  1. How well developed You think payments by cards are?
Unfortunately, the majority of issued cards in Armenia is payroll cards, which are debit cards. Non-cash operations with these cards in the trading and service network constitute a pretty small percent. The thing is that the clients are not motivated to use cards for purchase of goods, as in general, there is no commission fee for cash withdrawal for these cards. They prefer withdrawing cash from ATMs.
At the same time banks develop various lending projects attached to cards and several banks issue credit cards, which may influence the growth of non-cash operations. Usually, credit cards have commission fee and limits for cash withdrawal. That is why clients prefer paying with cards in shops, restaurants and at POS (points of sale).
Aiming at fostering non-cash operations some banks organize various actions for their cardholders, implement bonus projects, etc. Our bank also keeps pace with this trend. We develop a discount system, which gives our cardholders opportunities in trading and service network. For example, they receive discounts in many shops and restaurants. The list of companies is continuously growing.
It is worth mentioning that expansion of the infrastructure of cards’ service plays a crucial role in the development of non-cash payments. Currently, the banks are concentrated mainly on servicing the mercantile businesses in Yerevan, but those in regions are also getting involved. I hope that in the nearest future this process may develop faster as there are enough preconditions for that. The future increase of officially declared turnover will foster the interest of enterprises in the card transaction processing even more.
  1. The experience of other countries shows that the plastic cards’ market shall dynamically assimilate the implementation of new technologies and services, including operations via the Internet (Internet-banking). How do you find the situation on the local market?
In Armenia this sector is still at its initial stage, and at this point it is very difficult to evaluate the situation. The payments for utility and internet connection are in greater demand. For several providers and companies Ameriabank ensures payment for goods and services via the Internet. However, the number of such companies grows not that fast.  
  1. What services does Ameriabank provide by plastic cards and what further plans does it have in this aspect? What is the competitive advantage of the bank’s card processing? 
Our bank is one of the few banks, which offers a variety of several payment systems. Ameriabank issues cards of ArCa and MasterCard systems, as well as American Express cards. At present the bank issues all main card products. Beginning January 1 the bank will issue VISA and MasterCard Platinum cards too.
Our bank pays much attention to the service quality, starting from submission of an application by a client up to the servicing.
I would like to draw your attention especially at our Gold card, which stands out with its unique appearance. It is provided in a package which looks like a book, where one can keep everything relevant for the card, and which along with the main card also has free international discount card IAPA, travel insurance, covering all the types of insurance during a journey, etc.  
I think that the core competitive advantage of our bank is first of all the service quality. The growth in number of cards and the increase in operations by them vividly testify to this.
  1. Ameriabank is one of the few banks in Armenia to issue cards of local system ArCa and at the same time plastic cards of two international systems MasterCard and Visa. How well the “path” chosen by the bank is justified in terms of demand for cards and profit from transactions? Please, specify the number of cards in general and dynamics of cards issued by the bank: credit and debit cards, ATMs and POS terminals. What kind of plans does Ameriabank have in regard to development of card business? Do you plan to issue chip cards?
Participation in two international payment systems (MasterCard and VISA) at the same costs the bank very expensive at that. The Bank has taken these expenses consciously, taking into consideration the core principle of the bank, i.e. to be client-oriented financial institution. Since July of the previous year the bank is a Principal Member of VISA Int.. We do understand the need of clients for an opportunity to make a choice between cards of this or that payment system. We are now developing a new card product, with which the clients will be able to order cards of several payment systems simultaneously and attach them to one account. The bank also develops a new card project within the framework of which prepaid gift cards will be issued. From the beginning of 2010 we plan to commence issuance of chip cards, including cards MC and VISA.  
  1. Does the bank plan to set its own processing center to depart from the single interface and the processing platform of ArCa? 
Armenian Card is not just a mere processing platform. At first it was established as a national payment system, where our bank issues and services ArCa cards along with other banks.
Today ArCa provides to the banks processing services to ensure participation in international payment systems and totally corresponds to their standards. This makes the quick integration of banks in these payment systems possible. The centralized approach for the processing of various payment systems is not only economically justified, but it also solves a range of some technical issues, which would be rather difficult for the banks to deal with. That is why just at the moment our bank does not plan to establish its own processing center.
Updated 30.11.2009, 12:07
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