The FINANCIAL -- The
volume of PayPal transactions among Bank of Georgia customers has
increased by 47% since April, following the company’s entrance to the
PayPal is choosing to keep confidential the total statistical results of its operations in Georgia for the last three months. However, as Damien Perillat, Director of PayPal in Central and Eastern Europe, told The FINANCIAL, they are very satisfied with the results received on the Georgian market. “Georgia has already managed to make a serious commitment to the company’s global growth,” he said. Despite that though, PayPal services offered to Georgians are still limited as customers can only send money or pay via Paypal. The service is not available for merchants.
“Currently PayPal accounts in Georgia are unable to use our services to receive payments. When we offer our service to a country, we need to ensure that we are compliant with both local and international laws before we can offer our full service,” PayPal responded to The FINANCIAL.
Global e-commerce business PayPal, allowing payments and money transfers through the internet, entered the Georgian market in April 2013. Until then Georgia was in the list of the few countries where PayPal did not operate. Despite the fact that the service was available in Azerbaijan and Armenia, the Georgian Ministry of Economy spent two years in negotiations with the California-based company, offering its market to the global e-payments leader.
“While we cannot comment on local numbers, which also include number of users and volume of transactions per market, I can say that we are very satisfied with the results. It seems that Georgian consumers were looking for a simple and secure way to buy goods without sharing financial info,” said Perillat.
The number of non-cash payments in Georgia is on the rise. The share of cash in Georgia’s GDP, as of the end of June 2013, was equal to 6.9%, compared to a figure of 7.8% three years ago.
The number of transactions made within the Georgian economy with payment cards issued to residents as of the end of June 2013 was 5,737,266; the total value of the transactions - GEL 710,508,000 GEL. The amount of transactions as of the end of June 2012 was 4,631,564 units, with the total value of the transactions at GEL 592,049,000. The number of transactions in May 2011 was 4,082,969, total value of the transactions - GEL 546,038,000. In June 2008 the number of transactions was 2,246,667, with the value of the transactions at GEL 329,632,000.
“More than 5 million active accounts were added in the second quarter of 2013 globally, Georgia made a serious commitment to this growth,” he added.
On its side, an official from National Bank of Georgia said that only the company can deliver this info.
Due to the challenges and complexities associated with the worldwide financial network, the company cannot offer a firm date or timetable for expansion of specific services. “We can promise you that we are working hard to enhance our service within the nations where we are offered,” PayPal said.
Perillat said that entrance to a new market requires working closely with the local ecosystem, including regulators, and deeply understanding local consumer needs. “This is particularly important in the field of payment services and Georgia is no exception,” he said. He did not, however, name the reasons behind the extent of the delay with Georgia.
“As is our experience everywhere else in the world, expanding our business in a new market requires a lot of preparation, attention and investment. Especially if you are dealing with people’s money, you’d better do it right the first time,” Perillat told The FINANCIAL.
Georgian consumers are not also able to send money via Paypal at this stage. “This is the first step in our longer-term strategy. We aim to introduce the possibility to receive and withdraw money at a later stage. We are following a step-by-step approach,” said Perillat.