First twinned edition. April PLUS-Forums 2021: post-event summing-up

On April 26-27, 2021 a unique event took place at the Raddison Slavyanskaya Hotel & Business Centre in Moscow. It was the first twinned PLUS-Forum that embraced two most popular events on the same site: Payments 2021 and Cash Circulation + Self-Service.  Banking and Retail 2021.

For the first time since 2019, both Forums were held offline. This was especially welcomed by all market participants who were somewhat tired of the restrictions imposed by the usual online format practiced during the pandemic. As is known, the only true luxury is the luxury of human communication, and the April event showed that this statement of the classic remains more than relevant.

Over 1650 delegates attended the PLUS-Forum during two days of the event! More than 120 speakers, renowned experts and opinion leaders of the financial industry took part in the business section of the Forum – a significant number that confirms the relevance of our business agenda. 74 companies became participants of the exhibition part of the Forum, each of them being a headliner in its economic niche and a prominent contributor to the development of the industry.

For two days, representatives of the Bank of Russia, heads of key government agencies, top managers of payment systems, banks, large retailers, IT companies and equipment vendors discussed topical market issues. The list of topics on the agenda included the National Payment System Development Strategy 2021–2023, The Guidelines for Cash Circulation Development, the Digital Rouble, Payment Instruments of the Near Future, and much more.

Milestones of the PLUS-Forum “Payments 2021”

Opening the 11th International PLUS-Forum “Payments 2021”, Head of Mastercard Russia Alexey Malinovsky said: “Judging from the impact made by the coronavirus crisis, we are likely to see an accelerated process of ditching cash. Among the key Russian and global trends are the further development of a cashless and contactless economy, digitalization.” He noted that Russia would remember the past decade for the dynamic evolution of cashless technologies, which brought about a wide choice of payment methods, including those using smartphones and smart devices. “Mastercard is vigorously involved into the development of the Russian payment industry and introduces the world's best products and services, being the first to bring many of them to the market.” Speaking about the banking sphere digitalization in Russia, he mentioned that migration to digital cards had become a strongly pronounced trend: “We see that digital technology offers tangible benefits both to states and businesses, including banks, and we strongly support such migration.” 

Alla Bakina, Director of the National Payment System Department of the Bank of Russia, noted that the payment market proved to be prepared for operating in a pandemic to the maximum, both infrastructure-wise and in terms of instruments. According to her, three factors will be under focus for the next three years: competition, availability of financial services and consumer costs reduction. Speaking about the results of the implementation of the National Payment System Development Strategy for 2013–2020, the speaker drew the audience's attention to the following trends: an increase in the share of non-cash payments from 13.5% to 70.3%, a growth in the number of ATMs and terminals from 1.3 million to 3.9 million devices, and a jump of the share of cards issued by domestic payment systems from 5.4% to 32.9%.

Vladimir Komlev, General Director of NSPK JSC, emphasized that the Mir payment system was also guided in its work by the latest trends such as strengthening of the role of online mode in payments and communications with the client. “As the operator of the national payment system Mir we are aimed at developing payment services equally accessible to all market participants, who could build, on that basis, their own client services and products,” he said.

Payment market experts regarded the introduction of the regulated acquiring fees counterproductive. This was stated in the speech by Alexey Maslov, Co-Chairman of the Committee on Payment Systems, Association of Banks of Russia. According to the speaker, the practice of fee regulation in 2020 clearly demonstrated that the consumer gained absolutely nothing.

FinTech stakeholders also spoke about changes in the industry at panel sessions dedicated to the business transformation. Many experts agreed that digital transformation is inevitable and needs to be adapted to. By 2023, 60% of companies will reorient their business from processes to results. The main trends of 2021 include digitalization, automation, cloud technologies, personalization, handling large amounts of data, modular architecture and artificial intelligence. Summing up the results of the PLUS-Forum in general, it can be noted that the business community was optimistic about the prospects for the development of the payment market in Russia.

Milestones of the PLUS-Forum Cash Circulation + Self-Service

The 12th International PLUS-Forum “Cash Circulation + Self-Service. Banking and Retail” discussed a series of topical issues such as prospects and scenarios for further development of the cash circulation market, modification of banknotes and the role of the digital rouble in cash circulation.

As Bank of Russia Deputy Governor Mikhail Alekseyev noted that the main trend of cash circulation in the world was a steady growth in cash in circulation seen by most countries. At the same time, the share of cash payments in retail transactions was decreasing. In Russia, it dropped from 60% in 2012 to about 30% in 2020. Meanwhile, the cash volume that passed through the cash desks of the Bank of Russia divisions in 2020 decreased by 26.5% as compared to 2016. 

In these conditions, the main tasks of the cash circulation organization in Russia for the next five years will include optimization of cash turnover through cash services in the divisions of credit institutions using cash belonging to the Bank of Russia, increasing coin turnover and optimization of coin circulation, improving the quality of banknotes issued in circulation.”

 

Vladimir Demidenko, Deputy Director of the Cash Circulation Department of the Bank of Russia, emphasized that cash was still needed as a method of payment and will undoubtedly remain in circulation. In the long term, the role of banknotes may be decreased, and the only question is to what extent. The history of coins that can be traced far back will not be finished with the advent of other forms of money. While coins have not been the main form of payment for a long time, they will remain in circulation, performing one function or another.” 

Tatiana Aleksandrova, Head of Banknotes & Counterfeit Deterrence Division, Cash Circulation Department, Bank of Russia, drew the attention of the Forum audience to the fact that counterfeiters began to forge 10-rouble coins and informed about the main signs of such counterfeit coins that had been detected. Meanwhile, the 5 thousand rouble note remains the one most frequently counterfeited.

Alexey Voylukov, Vice President of the Association of Banks of Russia (ABR), noted in his speech that “objective conditions indicate that up to 20% of payments will be in cash over the next 5 years.” He outlined a number of top-priority areas of the cash circulation development, which form the centerpiece of the work of the Association of Banks of Russia’s Committee on Cash Circulation. Among them are the improvement of cash circulation regulations, better efficiency of market participants’ interaction (banks, retail, outsourcers), special banking and related equipment, efficient provision of cash to regions in the context of optimizing the structure of the Bank of Russia, ensuring environmental safety through the introduction of ESG principles. 

Georgy Kornilov, Director of the Research Institute of AO Goznak, noted that cash/cashless payments ratio in the Russian retail sector looks like 30:70 today, with the figure of 30% keeping its decline. As the expert noted, banknotes, although losing their payment function, still remain, however, an instrument of savings in cash.

Systemically important banks will act as the locomotive for adapting the cash circulation infrastructure to the issue of banknotes of the new modification, said Alexey Nichipor, Head of Cash Circulation Technological Processes Automation and Mechanization, Bank of Russia. According to reported data, it is divisions of systemically important banks that operate more than a half of cash counting and sorting machines today.

“Engaging the cash operations centres of commercial banks in solving tasks that were traditionally within the competence of the Bank of Russia infrastructure will make cash circulation less costly,” said First Vice President of Gazprombank Vladimir Busko, speaking at the Forum.

“Russians began to withdraw cash at ATMs less often, while the average amount per withdrawal increased by 8%,” emphasized Elena Petrova, Deputy Chairman of Russian Standard Bank. Touching upon such a relevant topic as the creation of digital ruble, she noted that any fears of reducing the cash circulation after the digital rouble adoption seem groundless, since the Russian digital currency will be easily converted into cash rubles and vice versa, depending on the current needs of market participants.

Lively discussions took place among experts at round tables.

At the round table “Security of payment business and cash circulation”, which took place on the second day of the 12th International PLUS-Forum “Cash Circulation + Self-service. Banking and Retail 2021”, experts reviewed methods of counteracting such a dangerous and relevant type of fraud as social engineering.

The panelists urged customers not to trust phone calls aimed at inducing them to any actions with their money, and call the bank at the first suspicion of fraud. At the same time, experts recommended credit institutions remember such classic risks as internal fraud at the bank and the introduction of malicious code into the bank's software.

The participants in the discussion agreed that the zero trust concept is the most effective approach to building identification and data protection systems, since it implies “aggressive” counteraction to any attempted attacks of criminals against the system of banking business processes protection.

The round table “Retailing plus banking. A trend created by the very logic of business” discussed the following issues: effective acquisition of a competitor's customers; creation of successful financial products without banking experience, using a large client base; the role of the regulator in the market development; the advantages of retail over banks in building communication channels with customers. The panelists noted that the success of a modern banking product is largely driven by a good IT infrastructure capable of providing a basic competitive advantage in the “battle for the client”.

Alongside the offline platform, registered participants could enjoy an online broadcast of the PLUS-Forum. The zest to the event was given by the grandiose exhibition of innovative banking solutions for business, where the exhibitors demonstrated their latest achievements to the Forum participants.

Gamma-Center, the Global Sponsor of the 12th International PLUS-Forum “Cash Circulation+Self-Service. Banking and Retail”, has presented LAUREL KS, a new counting and sorting machine. According to Dmitry Mulyar, Director of Commercial Banks Department, the latest product of Japanese engineers surpasses the same class equipment from other manufacturers in many respects today. This, in turn, increases the efficiency of counting large amounts of cash in cash centers. In April, the new LAUREL KS was included in the list of equipment recommended by the Bank of Russia for credit institutions.

Representatives of Oz Forensics have unveiled a methodology to counter such a dangerous and relevant type of fraud as biometric and deapfake attacks during the remote client identification. Oz Liveness technologists in the NIST-accredited iBeta laboratory repelled 100% of biometric attacks. “Our algorithms, based on deep machine learning, check video footage and track dozens of parameters (glare and reflections, micromotions, pulse rate, etc.). We trained the system on tens of thousands of attacks. This allowed our solution Oz Liveness to be certified under ISO 30107 and become the only domestic company in the Russian Federation that has this certificate. We can guarantee our customers high recognition accuracy of 99.99% for biometric remote identification and substantily reduce the risk of fraud. Anyone can visit our website, check how the technology works and try to bypass it,” said Artyom Gerasimov, Oz Forensics CEO, during his conversation with the PLUS Journal.

Cennox presented cash security solutions based on the innovative IBNS (Intelligent Banknote Neutralization System) technology. An intelligent system for making banknotes insolvent protects valuables in the event of an attack aimed at gaining unauthorized access to protected valuables. In his conversation with a PLUS correspondent, Cennox Chief Representative in Russia Alexey Popov said: “Cennox is positioning itself as a diversified supplier with the most complete portfolio of money protection solutions, helping its clients around the world. We present exclusive technological developments to protect valuables.” 

At the end of the event, the participants of the PLUS-Forum thanked the organizers for the unique opportunity to communicate on the same large-scale platform and wished them more successful implementations of their projects.

“Many thanks to the organizers for the opportunity to speak at the Forum. We will definitely participate in future events. We have the most ambitious plans for working in Russia”.

“Thank you for the excellent organization of the Forum!”

“Thank you for the invitation, it was an interesting experience. It is for the first time I attend such an event, and it seems that everything worked out well!”

 

“We met here all the clients we wanted to meet and talk to. I always have pleasant impressions from the PLUS-Forum. We wish the Forum to bloom with new colors in the future!”

“Congratulations and thanks for a very interesting event! Indeed, everyone has long missed face-to-face meetings. The reports were lively and quite frank, which allowed us to get a detailed understanding of what is happening in this country and beyond”.

“It's really a pleasure to work with you! You are preparign such huge, interesting and large-scale events! You are super professionals!”

See you at the next PLUS-Forum!

Global partner: Mastercard

The PLUS-Forum was supported by NSPK JSC (Mir payment system)

General sponsors: QIWI, FlexSoft

Main sponsors: nadeks, Best2Pay, RBK Money, Thales, DNA Distribution, Just AI, Benzuber, ATOL, Newland Payment Technology, i-digital, Oz Forensics

Partners: Sim2M, OSTCARD, Entrust, Sunyard, Shanghai SUNMI Technology Co. Ltd., PayMo, Frodex, Wallarm, Electronic Cloud, Fuzzy Logic Labs, Richcall, Dataphone, Regula, Terminal Technologies, LIFE PAY, banza, Novacard, ISBC, Saltoro, ivendPay, Bellsoft

Sponsors of the PLUS-Forum “Cash Circulation +Self-Service. Banking and Retail”

Global sponsor: Gamma Center together with leading manufacturers of banking equipment DoCash (Germany), Laurel (Japan), Hyundai MIB International (South Korea), Suzohapp (Scan Coin, Netherlands).

Chief sponsors: DEEP 2000, BS / 2, Intel, Telematica

Partners: Damask, LAN ATMSservice, Lanter, Cennox, Saga Technologies, PBF Group, ritm, Bauflex, SFOUR, Leta, Ekassir, BeltImpex, Bankom, OKI, Europeum, ATM Alliance, BFS, GRG Banking, TIC.