Yandex plans to launch a contactless payment service, challenging Apple Pay, the leader on the Russian market in this segment, as reported by VTimes. According to an internal document seen by VTimes, the users of ‘Yandex Pay’ will be able to save their bank details in the system to settle purchases.
In an exchange with VTimes, a Yandex representative reminded that Yandex users can currently link a bank card to their account and use this function to pay for purchases and orders from various Yandex services.
Neither confirming nor dismissing the information on Yandex Pay, the representative said: “We are constantly developing and improving opportunities for online payments. We want them to be comfortable and safe. To do this, we are developing new technologies and services on which we will communicate later.”
However, the new payment service expected from Yandex could essentially serve marketing and data collection purposes, believes a bank executive interviewed by VTimes.
Until last year, Yandex and Sberbank co-owned a major payment service provider and e-wallet called Yandex.Money. Following their divorce in mid-2020, Sber became the sole owner of the service, rebranding it to ‘Yoo Money,’ and launched a new payment service called ‘SberPay. ‘
Meanwhile Yandex started developing e-payment services on its own. In late 2020, the company was close to a merger agreement with Tinkoff, a leading digital bank, but the parties ultimately failed to reach an agreement.
According to central bank data cited by VTimes, no fewer than 66 payment applications operate in Russia.
Cashless and contactless payments on the rise
Apple, Samsung and Google launched their contactless payment systems in Russia in 2016-17. WeChat and Huawei entered the market in late 2018, as reported at that time by East-West Digital News.
Apple Pay is the current leader in number of transactions using contactless payment services in Russia, a bank expert told VTimes.
In 2020, customers began to pay for purchases more often using mobile devices, without taking out a physical bank card, notes Pavel Loutsker of Raiffeisenbank. He shared with VTimes data showing that the average transaction through such systems as Apple Pay, Google Play, XiaoMi Pay, etc., increased by 14% year-on-year in 10 months last year in Russia.
While cash was king in Russia until the early 2010s, cashless payments are now used overwhelmingly in the country. A 2019 survey found that up to 96% of respondents, depending on the region, used electronic payment means at least once per year.
Russia is now among the world leaders in the transition speed to non-cash payments — following the UK, Canada, and Australia, according to BCG data cited by Stanislav Grafski. The Bank of Russia says non-cash payments increased to some 70% of all consumer payments by the end of 2020. This transition usually takes some 10 years or so.
