Interview of Executive Director of Telcell Payment System Aram Azatyan to Mediamax Agency and Banks.am portal

- Recently you announced the launch of the joint service with Web Money. As far as we are informed, you, starting from 2008, accept WebMoney and “Yandex.Dengi”. How important are these services in your “basket”?

- The importance of any service is determined by the demand and the volume of the market for this service. Despite the fact that the demand for replenishment of Web Money and “Yandex.Dengi” purses cannot be compared to the demand for payment of mobile connection operator’s and utility services, we have always attached great importance to internet commerce.

In 2008, the payers of Telcell were provided the chance to replenish their RR purses of WebMoney and “Yandex.Dengi”, and since February 7, 2011, as a result of the agreement, signed with the official issuer of e-money WebMoney, we are glad to provide such a long-awaited service as the replenishment of USD purses and purchase of WMZ-checks, the so-called currency vouchers in internet, which do not require authorization: the user only needs to pay, receive the PIN-code for their cell phone and then freely spend the money in internet.

In connection with active development of the internet market and internet commerce in Armenia, we believe this service will occupy its deserved place in our basket.

- What are the prospects for introduction of “e-money” in Armenia itself? There is an opinion that the regulator has a conservative attitude towards this issue.

- I do not agree to the fact that the regulator has a conservative attitude. Back in spring, 2010, the Central Bank (CB) of Armenia approved the corresponding regulations, which fully regulate the issue of e-money. In fact, there is a situation, when the regulator, by its own initiatives, goes one step ahead of business, since almost a year has already passed and not a single company has yet submitted an application to receive the right to issue e-money. As an example, I can note that neither in Georgia, nor in Azerbaijan the sphere of e-money is as regulated as in Armenia.

Certain limitations, which lead to increase in price for the “entry ticket” to the market of electronic services, become an occasion to speak of CB’s conservatism: One should deposit AMD 30mln. There are certain limitations for the sum of a single transaction, to the volume of the sum in the purses, but, I believe, all these are simply initial precaution measures. Our experience shows that CB is always open for negotiations. As soon as the first precedent of an issue takes place and it becomes clear what hinders development of this market in reality, the payment systems will manage to achieve corrections by joint efforts.  

- Can you tell about your experience of accepting state duties, payment for Traffic Police fines? How promising is the direction of such payments’ maintenance?

- The process of accepting Traffic Police fines was launched in late 2009, becoming the first service of Telcell from the series of express payments. Due to this service, the payers do not need to waste time anymore to present the payment order to the Police: they simply pay for the fine via the terminal and receive an SMS notification on the payment. We managed to launch this service as a result of cooperation with the Police, and we are really grateful to them for that: the service is really demanded.

- You also accept payments for CTP insurance policies. What is the dynamics?

- It is difficult to keep statistics on CTP policies, since this product aims at servicing spread payments (that is, when the car owner purchases a CTP policy by installments and, for instance, makes payments for his/her policy once in each quarter). Telcell launched this service in partnership with “INGO Armenia” insurance company, which demonstrated a progressive approach and helped us for the first time realize the capacity of selling not only services, but also a good, which, per se, the insurance policy represents.

Competition in CTP market is so strong that the terminal itself could not be the most demanded or key link in this chain. We believe that activity will show here a bit later in terms of spread payments for the policies.

- What was the year of 2010 like for Telcell? What were the main focuses in the course of the year and what indices did the company achieve last year?

- The year of 2010 became a key year for establishment of terminal business in Armenia. In 2010 the demand for terminals in Armenia was demonstrated. Telcell underwent serious regional expansion last year. The first terminal was installed in Nagorno-Karabakh. A number of own products from the services of express payments were launched. Over 20 new operators were connected to the system.

The number of transactions, as compared to 2009, increased by 70%, and the turnover increased by almost 60%. At present, there are about 300 of our terminals operating in the territory of Armenia.

- In 2010, the company held a few promo-actions on consolidating and increasing customer loyalty. How do you assess their results?

- The large-scale promo-action, named “Luck Hunters”, was realized, aiming at popularization of coin-slots, which were installed on 150 of our terminals. The essence of the campaign was not the sum, but the number of transactions via our terminals: for each transaction, the customers gained points, the sum of which determined the winners. The main prize was a trip to Egypt for two. 24 cell phones, over 200 tickets to concerts and other prizes were also raffled. The project attracted both new partners (which were advertised on that platform and which offered their own prizes) and a large audience of payers. So, the results of the campaign turned out to be more than positive for us.

- What is the main difference between Telcell and other operators of instant payments? In simpler words, if I need to make a payment for this or that service, why should I specifically search for the orange terminal?

- First of all, we are grateful to you and to any payer, who chooses a payment terminal as a method of payment for various services. If we speak of differences, we will start from utility services: first of all, this is a zero percent of commission payment; secondly – the combined payment, where you may not pay for electricity, gas, water and telephone one by one, but put all the payments into one and receive an SMS notification on the payments made; thirdly – these are the coin-slots: if your debt, for instance, makes 5200 AMD, you can make an exact payment, which you owe, and not make for instance a 6000 payment, 800 of which will be kept as a prepayment.

Let me present our advantages in the sphere of payment for mobile connection services: our project, called “brotherhood”, gave the payers the chance to break up the payment, that is to say, one can for instance enter a 1000 AMD banknote, break it up into 5 parts and transfer AMD 200 to each of five friends. The preliminary marketing research showed that the Armenian payer needs such a service, since the minimum nominal of the AMD banknote makes about USD 3, which is quite a serious sum. For comparison, the minimum nominal banknote in Russia makes 10 rubles, which makes about one third of a dollar.

- Armenia is living through an internet boom, and the number of connections increases every day. What corrections does this fact make in Telcell work? Do you plan to change in connection with the changes in internet market?

- Telcell initially paid very serious attention to internet. Today, via our terminals one can pay for the services of 9 out of 10 largest internet providers in Armenia. We are open for any type of cooperation in the sphere of internet business.

- In 2010, Telcell was also active in the sphere of corporate social responsibility. In particular, by means of your terminals people could make donations for helping children suffering from diseases, as well as make donations for “Hayastan” Fund. What is your assessment of these initiatives of yours?

- It is extremely positive. Our experience in this sphere was launched from “Gift Life” Fund, and, of course, the experience with “Hayastan” Fund was also very positive. This was our contribution to the All-Armenian campaign. I should stress that while working with charitable funds, Telcell does not collect commission payments either from the payer or from the fund.