The FINANCIAL -- Visa in September announced Vera Platonova as its Senior Vice President and Group Country Manager for Visa CISSEE. Platonova, who worked for Visa from 2007-2010 in Ukraine, now oversees all Visa operations in seventeen markets across Eastern Europe, Central Asia and Southeast Europe, and reports to Visa's Regional President of CEMEA, Andrew Torre.
Platonova is a highly experienced executive in the payment systems and retail banking sectors. Her seventeen-year career includes strategy development and implementation, business development and operational management. Platonova joins Visa from MasterCard, where she was the General Manager for the company's representative office in Ukraine, Moldova, Georgia and Central Asia for more than eight years.
As part of Visa CEMEA's regional management team, Platonova will also represent CISSEE within the regional and global Visa network, ensuring that best practice from other markets can be offered to the regional payment ecosystem.
The FINANCIAL talked with Platonova about Visa's future visions and development strategy in Georgia.
Q. What is the development strategy of Visa in Georgia and its plans for 2019 specifically?
A. We will definitely pay much more attention to the popularization of cashless payments with Visa in the country. We will be focusing on the work with key stakeholders, key banks, but not only that. We will bring many more resources into the country. Georgia has been identified as one of the key countries we need to focus on. So if we are talking about the mass segment, we are thinking about what additional value we can provide to cardholders to support banks in their efforts to drive cashless and POS usage. We will also bring a number of premium products and benefits to the market. We hope to make Visa top of the wallet and drive usage of this segment because there still is a lot of cash here.
Q. What is Visa's role in developing payment technologies?
A. As you know, Visa is worldwide leader of payment technologies and it's definitely very challenging to retain this position of leadership. Now the whole world is moving to mobiles, to wallets, to all kind of gadgets, which are becoming new payment ways. We see that the future of payment lies not in the plastic world, but more in the world of payment experience. I think our region is one of the most developed globally, especially Georgia. Currently Georgia is the second country in the world by the number of face-to-face contactless payments at POSes), right after Australia.
Q. What is Visa's approach to blockchain in Georgia?
A. Blockchain is a very big and different topic from our core business. In some markets it's a kind of startup trend which is sometimes adopted and sometimes not. Therefore, we really don't build our strategy with a full focus on blockchain solutions because our core business, the world of payment itself, is growing too fast. We need to look at blockchain in 2-3 years and understand how it works and how it can be combined with the everyday experience of people in payments.
Q. What are your greatest challenges when it comes to innovation?
A. I think for all these 60 years of Visa's history the challenges have almost unchanged. One is the main challenge is changing the behaviour of cardholders - moving to cashless payments from cash. It's a big fight which we have been fighting for the last few decades. If we take as an example Georgia, one of the most developed markets, only around 30% of its total volume goes through cashless payments, terminals at merchants. The rest is cash from ATMs or cashier desks. This transition from cash to cashless is growing year on year, but we are still not fully there, it is a long way ahead. We rely a lot on the experience of mobile payments because the whole world shows that the behaviour of cardholders changes dramatically once they acquire the possibility to pay by phone.
We are very much involved in all kinds of social projects, in educational projects all around the world to bring cashless experience to the parts of population for which this way of payments is not so obvious. Last year we had a big initiative with National Bank of Georgia, based on our big platform Financial Football. We are trying to approach people from all angles, from social perspectives, from user experience perspectives, and from technological perspectives.
We also pay a lot of attention currently to e-com. In Georgia, around 50% of payments in cross boarder are done in e-com. Overall the share of e-com is only 9% if we look at domestic, though it's growing. That's why we are doing a lot of things to decrease people's fear of paying digitally.
Q. What are the main differences between the habits of Visa users in Georgia and those in other Eastern European countries?
A. I think that users in Georgia are really an example to follow compared to in many of the surrounding countries, including Europe. Georgia was the first country in the region of the CEMEA (90 countries) where Visa launched its Visa payWay card. Since that time Georgia has been the most developed contactless acceptance market with outstanding results (9 out of 10 transactions are contactless here). And people are very open to any innovations. We have 3 issuers wallets, offered by TBC Bank, Bank of Georgia and VTB Bank. They are very popular and this is a sign that the people are much more ready for payment innovations, sometimes even more so than the big corporations.
Q. What prospects do you see for the development of e-commerce in Georgia?
A. E-commerce share is only 9% in the payment volume, and 5% in transactions currently, which is quite small. As I mentioned earlier, in cross-border around 50% of the volume is in e-com. I know that there are a number of good cases of e-com already in the country. From the experience of Ukraine, Belarus, and other countries, which have already started quite big expansion in e-com, I can say that this market can grow by 100% per year, dramatically and very quickly. A lot of responsibility for the quality of this experience lies on banks. We are considering making this experience very easy, like a single click.
Q. What are the main advantages Verified by Visa and how this helps to drive e-com?
A. First of all, the key banks are already certified for the technology 'Verified by Visa'. They know how to make it easy for the cardholders. The second point is that it completely secured. We have done a number of researches on what stops people from paying over the internet. There are a number of points but the first one is security, they are concerned that if something happens they will lose money.
So, first it's important to educate people on the security of payments in e-com. We are working right now with the key banks and some educational staff on how to deliver this message to people. In 90% of cases the leaking of credentials happens because the cardholder discloses their personal data by phone or in some other way. So education and promo activities will bring people into e-com.
Q. How would you evaluate the statistics of Visa card payments during 2018 in Georgia? How have they changed in the last 5 years?
A. What we see from overall statistics on the market, is that there is still high potential for growth. Domestic transactions grew around 35% on year on year basis. If we compare this indicator to 2016-17 it was around 29%. So the market is growing even faster than in previous years. Cross-border transactions grew 53% in 2018, vs. 28% in the previous period. Currently the ratio of payment volumes to total volumes is 27%, in 2017 it was on 22%. So people are paying more and we see it in the volumes.
Another sign of the maturity of the market is the average ticket. It's currently around GEL 50, though this is slowly lowering. So we see that people are making many more transactions for small ticket operations, so meaning they pay more in their usual life. We see the market is growing 43% on payment volumes year on year without any decline. I would say that this is one of the best indicators of market growth in the region. Georgia year over year shows excellent results. People are really changing their behaviour.
Q. What about your competitors, what's your further strategy and special offer for consumers?
A. The competition is great. Without successful and smart competitors we would not be that strong. We identify our strategy in two ways. The first direction is working with banks, merchants, businesses; and here we work to help our partners to bring really high value proposition with Visa cards to their cardholders. There are a lot of ways to achieve this: joint activities; bringing added value benefits; driving technologies; undertaking joint trainings with bankers. And another big direction which we are developing right now is B2C, meaning talking directly to the cardholders.
Here we will intensify our efforts to drive this B2C sector and you will see in the next few years that Visa will be closer to cardholders in delivering messages on how to pay, and what exactly the cardholder can get when they make transactions with Visa. I think we need to popularize this topic much more to deliver the information to people about how they can actually get the benefits. So we will be focusing on bringing added value and also delivering the message explaining how they can easily access the benefits which Visa provides.
Q. Do you think that digital wallets may replace card payments in the near future? If so, how could cards be transformed in the future?
A. I think that plastic is only one of dozens of payment form factors which exists. Definitely plastic year on year will be decreasing in quantity and everything will gradually move to mobile phones, to gadgets, finger print payments, and face recognition payments. But it doesn't mean that cards will disappear entirely. Payment through Visa technology will not disappear. It's not about the card. It's about the fact that you pay. And the fact that there is a network all around the globe uniting all banks which Visa supports to make transactions. That's why we don't have a fear that plastic will disappear. Moreover we are actually pushing this trend for mobile phones to be the main way of making payments ASAP.
Q. What are the global fraud trends? What is the situation in this regard in Georgia?
A. Fraud is a permanent and unrelenting war between payment systems, banks and fraudsters, which sometimes become very smart, however at the same time we are building and strengthening networks to make them much more sophisticated and protect cardholders and their data. Our part of the world is probably one of the most secured in terms of payments. First of all, because we are much faster when it comes to adopting new technologies.
The level of fraud with contactless cards is much lower than with chip cards, and with biometric recognition, it is almost zero. So the more we make the move to modern technologies, the less fraud we have.
Also, Georgian banks are extremely sophisticated. Even with all the support of international payment schemes, the banks themselves are very smart in protecting cardholders. They have online monitoring systems, Visa platforms for how to make payments secure in also online mode. The topic of fraud is not that hot in our part of the world and the main problem still remains the overall financial education of people who sometimes might disclose their personal data.
Q. Georgian banks refuse to cover damages in the event of card fraud and unauthorized use of cards. What is Visa's policy towards this in other countries?
A. We have a so-called "zero liability" policy in all countries in the region under which a cardholder is not responsible for fraud, if he/she has not disclosed their personal information. At Visa we work in any market of our presence in accordance with our own rules and the laws of the country. I really don't think that banks don't want to take on the responsibility of fraud cases. It's probably the condition of the contract and the way the fraud happened. It's a question of investigation in each individual case.
Q. How have the methods of criminals been changing in light of contemporary technological development?
A. Fraudsters sometimes get very smart. They're developing new ways, new technologies and solutions to crack data and get personal info. But at Visa we have strong security controls and are constantly upgrading all of the technologies to protect data. We have a number of platforms which banks also use and which allow identification using big data analytics to identify and prevent fraud and block suspicious transactions at the very moment they're happening.
Q. What is your main security advice for your cardholders?
A. Don't disclose your personal data to anybody. 99% of fraud cases happen when a person gives his or her card to somebody or even tells them their pin code. The security of people lies in their own hands.