OREANDA-NEWS. June 16, 2010. Economic mechanisms should be introduced to encourage cashless payments, said Prime Minister of Belarus Sergei Sidorsky at a session of the Council of Ministers Presidium. The session was supposed to discuss the progress in fulfilling the 2006-2010 state program for developing the physical infrastructure that enables the use of plastic bank cards.

Belarus Vice Premier Andrei Kobyakov told the session, back in 2007 it was decided to reduce the commission fee for acquiring from 2.5% to 0.3-0.5% or by 5-8 times. The decision made the cost of acquiring equal to the cost of cash collection services. When cash collection was five times as cheap as acquiring, shops refused to switch to using bank cards because such a move would be unprofitable.

“We have been working like this for two years and have achieved major results. To go on, it is necessary to make cash collection 20% more expensive than acquiring. While the first step was made at the expense of banks, the next step should be made at the expense of shops. It is necessary to make cashless operations more profitable than cash operations. It will be a good incentive for the trade industry to hold various campaigns to encourage shoppers to use plastic cards as much as possible,” stressed Andrei Kobyakov. Moreover, cash collection is the most expensive service in most countries.

The possibility has been repeatedly discussed between the Council of Ministers and the National Bank, with no accord reached so far. The latter insists on keeping the situation as it is and making shops to achieve predetermined cashless payment figures.

Sergei Sidorsky backed Andrei Kobyakov’s proposal. “Cashless payments should be encouraged using market mechanisms. The National Bank should forget about enforcing performance targets. It is not the accepted practice abroad,” said the Prime Minister.

“We have already done a lot to develop the infrastructure of cashless payments. We now have to encourage people to use it,” said Andrei Kobyakov.

Goals of the state program have been reached on the whole, with some of them exceeded. As of 1 April 2010 there were 7.9 million plastic cards in use, 2,748 ATMs, 3,071 self-service terminals and 21,689 payment terminals.

Andrei Kobyakov said he believes it is impossible to raise the share of cashless transfers up to 30% by the end of the year and suggested correcting the figure.

As of 1 January 2010 the share of cashless payments for services rendered to individuals stood at 8.7% and accounted for 5.5% in the total retail trade. In 2009 the share of cashless transfers in the total sum of operations involving plastic cards amounted to 11.4%, the number of cashless transfers in the total number of operations involving plastic cards amounted to 45.3%. In Russia the figures are 9.2% and 28.2%, in Ukraine – 5.2% and 13.1% respectively. Thus, Belarus’ level of cashless payments is one of the highest ones achieved among the countries with similar startup conditions for this kind of services.