Cash Still Preferred

The FINANCIAL — Cash and change will be actively used by the Georgian population in coming years.

A recent survey shows that payment by cash is still very popular despite the fact that the number of online transactions has increased more than five times since 2007.

According to the National Bank of Georgia, on July 1st 2011 the total value of currency in circulation was 1,536.99 GEL. On the same day in 2007 it was 1,030.84 GEL.
The FINANCIAL tried to find out what the approximate amount of money the average resident of Tbilisi carries daily and what they think about using change. The results showed a very interesting picture.

A wallet of the average resident of Tbilisi contains approximately 20 GEL daily. The majority of them almost never refuse to carry coins. But at the same time more women tend to have change in their pocket than men.

In Georgia generally up to 5 GEL is on hand in coins per person. It is one of the main reasons of the wide use of change. As 25 % of surveyed people tend to carry 5 GEL daily they just have to have coins. In spite of this, the vast majority of them find carrying change inconvenient due to the weight and space needed for coins.

This problem is more important for men than women. Twenty percent of surveyed men frequently give away coins in different ways including charity or to their children. Unlike them, women almost never give away change because of its inconvenience.

Paying a municipal transport fee has been available by special plastic cards for several years. The new system of paying for the mini-bus by card was launched about a month ago. Sixty percent of surveyed people think that it will reduce the use of coins as transport is the main reason for carrying change.

“Paying for transport with a card is a very good idea. I don’t have to carry so many coins with me anymore and it’s more comfortable,” Tako Beridze said.

The number of plastic cards has significantly increased in the past several years. More and more people get their salary by bank transaction and therefore the number of active cards is increasing as well. According to the National Bank of Georgia, if in July 2008 the number of plastic cards was 2 ,529.67 with 1,026.61 active out of them, in July 2011 the number of cards reached 2,917.02 with 1,201.68 active.

But 50 % of the surveyed people still prefer to get money from the bank and pay with cash. They say that they feel more clumsy when paying by card.

“I’m not sure that a card terminal will be in the store where I’m shopping. So to avoid extra problems I use cash and not my card,” Giorgi Lonzhanidze said.

On the other hand, another 50 % always pay by card and say that it’s the best way to control expenses.

“I always have my card with me and use it whenever possible. But I feel more confident, when I have enough cash in my wallet as well,” Nino Sherazadishvili said.

“Paying by card is so comfortable and pleasant,” she added.

Representatives of various stores in Tbilisi confirm that number of card payments is increasing.  According to Address shops (Celio, Etam, Promod etc.) the number of card payments has increased by 5 % in comparison to last year.

“Card payments are certainly increasing. They are currently almost equal to cash payments,” said Khatuna Parjiani, manager of United Colours of Benetton.

By July 2011 the number of card transactions was 4,336.41 in Georgia. Its total value was 625,763,000 GEL. 10,800,000 GEL transacted by 252,863 operations out of them were through the Internet.

These numbers have been growing for several years as the number of transactions was 977,797 with a total value of 215,112 GEL in July 2008. 1,545,000 GEL was transacted by 22,582 operations through the internet.

One of the main advantages of credit cards in Georgia is that holder can more easily get credit from banking institutions as some local banks offer bonuses for payments made by credit cards. They are not particularly significant but they make you feel more priveleged.

Reports of credit card payments and income is also required by foreign consulates while asking for a visa.