Baku: Financial inclusion in Azerbaijan has seen significant advancements in recent years, with 1.5 million individuals newly integrated into the financial system.
According to Azeri-Press News Agency, this surge is attributed to the implementation of various financial technology initiatives that have revolutionized access to banking services across the country.
The Asian Development Bank (ADB) highlights that by 2025, an estimated 3.85 million people, roughly one-third of Azerbaijan’s population, will be utilizing digital payment systems. Central to this transformation is the Instant Payment System (IPS), developed under the central bank’s digital payment strategy. This system facilitates remote customer registration and account management while allowing secure sharing of account details between vendors and banks to enhance payment processes. Currently, the IPS platform is connected to 19 banks, the Finance Ministry’s State Treasury Agency, and the national postal service, Azerpost, with plans to extend its coverage and digital offerings.
ADB further reports that Azerbaijan has embraced innovations such as ‘tap to/on phone’ technology and an Electronic Knowledge Management System to bolster financial access and remote identification. These advancements are supported by ongoing efforts to establish legal frameworks and standards for open finance. Between 2017 and 2021, the value and volume of mobile and internet banking transactions increased significantly, reflecting the growing adoption of digital banking services. Notably, four banks launched an Apple Pay project in 2021, further diversifying payment options through tokenization technology and virtual payment cards.
The ‘basic banking services’ project, launched in 2021, has been pivotal in improving financial inclusion. Offering essential banking services at no cost, including account opening, payment card issuance, and access to electronic banking, this initiative has integrated 1.5 million previously excluded individuals into the financial system. These reforms in electronic banking services, coupled with innovative payment solutions, have greatly enhanced access to banking services in Azerbaijan.