Shadow economy is a serious obstacle to open banking, comment DIGI PAY 2021 Conference participants
The volume of online trade in Bulgaria can exceed 1.25 billion euro in 2021, said Janet Naydenova – President of the Bulgarian E-commerce Association during DIGI PAY 2021 Conference. The expected growth of e-commerce for this year is 30%.
71% of the population of Bulgaria has Internet access, and 31% of Internet users were online shoppers by the end of 2019. By 2020, online shoppers expectedly increase to 42% of all Internet users, as the pandemic changed the way of life around the world, the expert commented. She added that Bulgarians are very proactive in using technology. The level of development of e-commerce is determined by the ratio of the volume of e-commerce to the GDP of the country. The forecast for E-GDP for Bulgaria for 2021 is 2.5% compared to 2% in 2020 and 1.89% in 2019.
But in 2020, 60% of payments are through cash on delivery compared to 70% in 2019. Card payments are growing from 25% (2019) to 32% (2020). 8% are bank payments and mobile payments in 2020, compared to 5% a year earlier. The average Bulgarian consumer pays 637 euros a year online, compared to 435 euros in the annual basket in Eastern Europe.
Only with modern methods of payment we will be able to brighten the economy, commented the representative of the Bulgarian e-commerce association.
According to the Bulgarian E-Commerce Association, the obligation for electronic merchants to issue a receipt for CNP transactions should be abolished. In order for Bulgaria to develop as a modern country, card payments must be distinguished: CP - Card Present (for example, physical POS in a shop, restaurant).
The shadow economy is the biggest challenge for the development of open banking, commented the participants in DIGI PAY 2021. During the discussion they pointed out that this is one of the reasons for the popularity of cash on delivery and this stops the development of digital solutions.
Premiere of Pay by click and Pay by link and the financial profile InfoPay during DIGI PAY 2021
In 2021, the immediate payments in Bulgaria were launched. For the first time before the professional audience were presented the new payment terminals Pay by click and Pay by link, which use the opportunities of open banking, said Merdihan Ismailov from IRIS Solutions. They offer account-to-account payments as an alternative to widespread card payments. This type of mobile payments are widely used in Asia, most widely in India, Japan, China and even without an Internet connection.
Digitalisation of financial services is one of the processes that has been accelerated by the pandemic and will continue to do so in the future, said Eva Maydell, MEP and member of the Committee on Economic and Monetary Affairs, at the DIGI PAY 2021 conference.