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Head of the department for the development of services and the payment system of the LeoGaming fintech company Irina Tsybulnik talks about the development of the non-bank financial services market and explains the rapid growth of popularity of payment terminals and “mobile” money.

Can you tell us about the market of non-bank financial institutions? What are the key characteristics of its development in recent years?

The majority of people are aware of the fact that the influence of non-bank financial institutions (hereinafter referred to as NBFIs) in the financial market of Ukraine has grown significantly in recent years. It happened both as a result of the natural development of the market in the current legislative environment, as well as because of changes in the structure of the financial system itself.

A few years ago, small banks left the market. The reason was simple: they could not withstand the crisis in the domestic economy. At the same time, their place was not taken by financial companies. They simply cannot do this, since banks and NBFIs are different entities of the financial industry, although they have similar properties in many aspects. However, keeping in mind the fact that regulatory pressure on banks was increasing, financial companies were able to occupy those niches, where banks could not operate any longer. NBFIs became transactional organizations for payment systems that include banks. For example, the LEO international payment system works using the same way.

As a result, the market was distorted, which was solved by the Split Law (No. 79-IX) that came into force in July 2020. Supervision of financial companies was transferred to the NBU, thus allowing creating the unified “rules of the game” for the main financial services provided by all participants. We are talking about money transfers, credit services, and currency exchange operations. Financial companies often create strong fintech brands, while banks actively work with them. The financial company develops a technical solution, while the bank provides financial infrastructure. Thus, a holistic ecosystem has been actively created in Ukraine in recent years. It is worth noting that non-bank financial institutions have a very stable position within this ecosystem.

What are the key segments where non-bank financial institutions can compete with banks?

Banks are not able to offer a wide range of financial services. These functions are most often performed by the NBFI. First of all, we are talking about insurance. If the bank decided to provide insurance services, it has to cooperate with an NBFI, while the bank works as an insurance intermediary.

Secondly, we are talking about lending. In this case, banks and NBFIs play on the same field but having different audiences. NBFIs work with the segment of customers who need credit services but have no chance to get a loan from a bank due to higher requirements for the creditworthiness of the borrower. These are low-income individuals, who use the services of credit financial companies or pawnshops. The interest rate on the loan there is higher because of the riskiness of the operation.

Thirdly, we are talking about currency exchange operations. As you know, it is much easier for a financial company with a currency license to open a currency exchange office than for a bank to open a new branch. It turns out that NBFIs have a wider audience, sometimes introducing innovative cases. For example, our LeoGaming Pay financial company has launched the first office for currency exchange operations in Ukraine with a software payment transactions recorder.

How the new law on financial monitoring affected the financial market and the clients of financial companies?

Law No. 361-IX improves the financial monitoring procedure and brings it in line with the financial monitoring standards established by international and European authorities.

First of all, it is worth noting that the law expands and tightens the requirements for the identification of people making money transfers. For example, these days one cannot top-up any service for the amount of more than 4999.99 UAH by using a payment terminal. To pay more than 5,000 UAH, you must enter your identification data. Previously, such a requirement also existed, but it was applied for amounts over 15,000 UAH. However, there are several exceptions:

• Payment of utilities, taxes, fines, and other budget payments (regardless of the amount)
• Repayment of loans of less than 30,000 UAH.

At the same time, the amount of a financial transaction subject to financial monitoring has been increased from 150,000 UAH to 400,000 UAH.

The new law introduces a risk-based approach to the implementation of financial monitoring, which means a deeper check of suspicious customers and a simplified one for reliable ones.

The law also introduces the long-awaited possibility of remote verification of the client without any need for their physical presence. These days, the entire process of verification of the client’s identification data can be carried out, for example, using the BankID system by NBU, or a qualified electronic signature.

Besides, new approaches to the responsibility of the subjects of the preliminary financial intelligence are worth your attention. The number of fines has significantly increased. Also, the amount of the fines for specific types of violations are clear now.

How is the market of payment terminals developing in the context of the growing popularity of non-cash payments?

It is worth noting that the market continues to grow. Only this fact alone eliminates any negative connotation from the question. The terminal business is inventing new niches and options for working in the realities of the growing cashless economy. But at the same time, it is worth remembering that the main audience of customers of payment terminals (and these are millions of Ukrainians) did not suddenly stop paying in cash because they had a PayPass card to pay for groceries in a supermarket. I want to highlight another important thing. The coronavirus has not killed the will of people to pay in terminals. Even in 2020, we saw stable growth in turnover. A wide array of marketing tools stimulated this demand. In general, the situation is the following: when people stay at home, they play games. But they are used to top up their accounts in the terminal located in the nearest grocery store. They do not want to enter all the card credentials in the browser.

If we talk about development, there are several amazing projects here. For example, the iBox terminal network was the first to install NFC readers on terminals. By using this advanced system, the client does not need to enter 16 digits of the bank card to top it up. They can just approach the card to the reader. In addition, Sistema terminals allow using the DIYA verification app to make payments of more than 4999 UAH.

Can terminals compete with online payments? If yes, in which segments?

They do not have to, because they develop in the same direction. One of the most popular services in payment terminals is the ability to top your bank card up. In fact, the terminal has become a mediator allowing people to move from cash to non-cash economy.

A payment terminal is one of the many popular payment methods for goods and services. Local companies worked, work, and will work with terminals because the business needs to have direct access to the customers.

What is the role of mobile money in the Ukrainian reality? Is it really popular among the people? When do they use it?

This is a convenient non-bank payment alternative. The “mobile money” payment method is the evolution of payments using SMS commands, which has existed in Ukraine for almost 20 years. Now the mobile balance payment buttons appear in the payment forms of websites and apps along with the bank card payment options.

In general, the prevalence of mobile money depends on the category. For example, in the field of online games, the share of payments with mobile money ranges from 5 to 30%, depending on the service. Operators are investing resources in the development of their “payment buttons”, thus exploring new niches. For example, LeoGaming together with the three operators launched parking payment via SMS commands in Kharkiv. During the first days, the demand exceeded all our expectations.

What are the most prospective areas for mobile money? Can you give us examples where mobile money will be useful to the average consumer?

The main advantage is the simplicity and clarity of this tool for its target audience, i.e., people aged from 35 to 55 years. They use the same way of payment for many years in a row. In addition, they are also active users of terminals. The payment takes place immediately, while the person just needs to confirm it with an SMS code. In addition, there is a large segment of people in Ukraine who do not have a bank card. For them, paying with mobile money is a good solution to substitute bank cards.

Motivation is a prime need, and everybody speaks about it when it comes to creating outstanding accomplishment, whether at work or in life. Those who think it is of extreme importance for motivation. All begins with their ambition and inspiration no matter what they are trying to do in life. The reason for doing things and developing habits is required. While it is true that they can solely rely on encouragement to achieve their goals and to pursue their dreams, motivation is always much needed for initiative and the overall success of their lives to be achieved. Every year there are several oralconcerts and if you wasn’t there to be a part of the same then, no need to worry. Below are some basic concept regarding motivation so let’s read:

Motivation strengthens the work

Yeah, every commitment is inspired. People may feel lazy and slumber without motivation. Without motivation. They do not want to take action, but they want to waste time and don’t do something.

They feel inspired and want to make massive acts when they have motivation. It increases their commitment and they will find that at the end of the day they have taken more steps on days when they are completely motivated than when they do not.

Engagement increases efficiency

Motivation also has the second advantage of increasing efficiency. Motivation not only makes them work more smoothly but also quicker.

Motivation allows them to counter all odds and see the choices

They need to be inspired to have challenging times. It is quick to take action, be happy and have fun when all is smooth and up to their schedule. When things go against them, the real challenge comes. If all their work is not working and all other goals are failing, these are all the times when motivation is the most important.

Motivation can affect others

They all know the infectious force. But they want to be around someone highly motivated and optimistic rather than somebody who always complains, is it not? Motivation can affect other people. The energy can influence those around them.

Motivation creates the routines

Think again about people who say encouragement is not as relevant as customs. They need to be motivated, particularly at the start, to develop one’shabit. When an activity becomes a habit, they still need to be inspired to follow the habit, only to release the waste they need.

Motivation makes the trip enjoyable

Yes, things would be dull without encouragement. Like reading this post, people probably just read the subheadings if people don’t feel inspired to read, but maybe just quit watching at some point.

They are inspired to achieve those goals and dreams

That’s evident, isn’t it? And have to be inspired to do stuff. They have to be inspired to have challenging times. And inspiration naturally leads them to certain goals and allows them to live those dreams. They all need a kind of inspiration to do what they want in their life and some purposes.

Accounting firms have a lot of other services to provide, other than tax filling and keeping financial records. They assess your financial assets, revenue and expenditure, financial loans, and everything else. Considering all these aspects, they come up with effective financial plans for the year, ensuring the prosperous growth of your business. Small business owners, however, fail to realise the importance of accountants. Attempting to cut down extra expenses, they try to deal with financial matters themselves only to face losses in the long run.

Poor management of finances is one of the main reasons for closing down businesses abruptly. Studies depict that nearly 60 percent of small businesses do not hire financial advisors or accountants. Below enlisted are a few ways in which partnering with a professional accountant proves to be helpful for the business.

Helps you to avoid audits

A major benefit received when you hire an accountant is that you no longer have to face audit issues. Usually, small businesses tend to hire accountants after audit issues occur. But, if you work under the guidance of a professional accountant from the beginning, you can easily avoid an audit. Consulting an accountant throughout your entrepreneurial journey would help you keep your business fiscally sound.

Saves your time

Usually, small business owners follow a strict budget. They try to deal with financial matters themselves. However, in the process, they spend too much time managing finances, neglecting the other departments. You must know that the cost you spend in hiring an accountant is certainly not more than the innumerable benefits you would derive. As an entrepreneur, you must concentrate on attracting more clients. Leaving financial matters to a reliable Toronto accounting firm would allow you to do so.

Take actions after considering probable future outcomes 

No matter what decisions you make, a financial accountant is always able to foresee the probable outcomes of your decisions. Considering the effects you know and the risks associated, it becomes easier to implement decisions and strategies. An accountant can look at the bigger picture, thus finding out ways to cope with losses, if at all they are likely to occur in the future.

Accountants Toronto are extremely useful and professional. They are experienced and have been delivering financial services for years now. They would come up with the much-needed expertise and guidance you need to ensure the positive growth of your business.