The Central Bank strengthens control over citizens’ cash payments

The first non-bank agent for accepting cash payments from individuals has appeared in the register of the Bank of Russia. It became a small Sevastopol company. Market participants and experts believe that the register will quickly fill up, since in less than a year such activities will be prohibited without participation in it. Despite the expansion of non-cash payments, cash payment for housing and communal services, telephone, Internet and others remains a popular service, especially in the regions, and the revocation of the license from Qiwi Bank has opened up additional development opportunities for other players.

Central Bank entered into the register the first payment acceptance operator – Digital Innovations LLC. The company is registered in Sevastopol. According to data from site Digital Innovations themselves, the company currently has only four cash desks in the city.

Operators provide services for accepting cash payments both through a cash register and using payment terminals and allow citizens to pay for goods and services (for example, housing and communal services, communications, television and the Internet), as well as make mandatory payments. Now legal entities can accept cash payments from individuals without inclusion in the register and licenses on the basis 103-FZ “On the activities of accepting payments from individuals carried out by payment agents.” However, in the fall the situation will change.

The law establishing new requirements for such operators came into force on October 1, 2023. Organizations that, as of this date, were accepting payments as operators will be able to operate without including information about them in the Central Bank register only during the transition period until October 1, 2024.

“The activity of accepting payments from individuals is the acceptance by the payment agent from the payer of cash aimed at fulfilling monetary obligations to the supplier to pay for goods (works, services),” the Central Bank explained to Kommersant.

Kommersant’s interlocutor in the payment market clarified that “before the amendments, the segment was deprived of the control of the Central Bank.” “There were often cases when funds were deposited, but did not reach their intended destination; in addition, players circumvented the requirements of anti-money laundering legislation,” adds another Kommersant interlocutor.

The Central Bank did not answer the question about the volume of the market for payments to individuals subject to the new regulation. Market participants noted that the largest player in this segment was Qiwi. However, its terminals operated as a franchise, so there is no aggregated data on the system, and the system itself actually no longer exists: Central Bank February 21 revoked the license from Qiwi Bank (part of the Qiwi group), which acted as a settlement center. Due to the revocation of the license, the work of non-banking services has been disrupted, which opens up opportunities for new players to enter the segment, Kommersant’s interlocutors note.

“The Central Bank has already introduced an additional class of non-bank payment agents. There was an idea that they would be a good class of players for banks, in order not to take on risks regarding identification and a number of other issues,” notes independent expert Maxim Mitusov. “The idea is good, but in fact, such agents were entered simply as a term, but for the regulation of their activities did not prescribe the necessary functionality.”

According to the head of the Association of Participants in the Electronic Money and Money Transfer Market, Dmitry Dostov, technically now the majority of payment agents are bank ones, and the Central Bank in fact controls them through credit organizations: “Nevertheless, a certain number of non-bank payment agents remain, and now the regulator is also introducing them into the control perimeter.”

The head of the board of the Financial Innovations association, Roman Prokhorov, emphasizes that “the process of registering payment acceptance operators has begun, and this cannot but rejoice.”

“Despite the growing share of non-cash payments, cash payments, for example, for housing and communal services, are in demand by the population, especially in the regions,” explains the expert. He clarified that, according to OKVED, about 1.3 thousand payment agents are currently working in the Russian Federation.

“Such a significant market, including socially, could not remain without the attention of regulators for long,” adds Mr. Prokhorov. “In terms of new requirements… inclusion in the register of the Bank of Russia, for which it is necessary to collect a set of documents and ensure compliance with the requirements of the law, as well as the requirement to participate in an SRO, which will carry out standardization of activities, collection of reports and control functions.”

Ksenia Dementieva, Maxim Builov