Mobile transactions declined significantly over the past calendar month (ended Feb. 19) largely due to hassles of using one-time-passwords.
A total of 96.42 million transactions were handled by mobile phones last month, down from 114.53 million a month earlier to register a solid 18% decline, according to a report by the national payment settlement network, Shaparak.
The sharp decline is ascribed to the compulsions imposed by the Central Bank of Iran on bank customers to use OTP instead of static passwords.
Using OTP is problematic for many people as they were required to install special applications on their smart phones. Some others simply didn’t own a smart phone to be able to use the service.
SMS services were later offered by the CBI to address a large group of customers who don’t use smart phones to install banking applications.
Shaparak data, however, indicates that OTP didn’t pose any major impediment on internet transactions. Internet payment gateways processed 134.66 million transactions during the month, up from 130.98 million a month earlier.
A total of 2.31 billion transactions worth 3,242.3 trillion rials ($21.2 billion as per current exchange rates) were processed by Shaparak during the month to February 19. The transactions posted a 4.69% hike in number and increased 15.23% in value on monthly basis.
Volume and value of transactions experienced 17.25% and 35.94% hike, respectively, compared to the same period last year.
When adjusted for inflation, the real value of transactions was 13.95% higher on a monthly basis and up 8.77% annually.
Apart from the inflation side, increase in the value of transactions is attributed to increase in the number of receiving instruments and debit cards plus growing tendency among the public to use electronic payment tools instead of cash.
Payment Instruments
Shaparak offers services via internet, cellphone and point of sale (POS) devices.
Internet payment gateways had the highest growth in number and increased 2.42% to reach 1.14 million by the month to Feb.19.
The number of POS devices in shops, grew 1.19% compared to the month earlier. Mobile instruments registered 0.85% monthly rise in volume.
In sum, the number of instruments for processing payments showed 1.28% hike compared to the month before, reaching a total of 10.71 million instruments.
In terms of market share, POS devices ranked first with 77.15%. Mobile instruments were next with 12.17%.
This was followed by internet payment gateways at 10.68%.
The higher number of POS devices is ascribed mainly to their larger spread compared to other devices as well as their convenient use without the need for supplementary devices such as PC or cellphone, which may not always be available or accessible.
POS devices represented 90% of the total number of transactions with 2.08 billion transactions worth 2,832.9 trillion rials ($18.51 billion) during the period under review. This was followed by internet payment gateways with 5.82% and mobile instruments 4.17%.
Figures indicate that “buying goods and services” represented 85.19% of the transactions.
During the period, 9.71% of the transactions were conducted for “buying cellphone recharges and paying bills” and “checking account balances” accounted for 5.10% of the transactions.
Penetration
Shaparak reported on the penetration rate of payment tools, according to which there were 1,795 payment instruments per 10,000 adults (above 18 years old) during the mentioned period.
POS devices had the highest and internet gateways the lowest penetration rates, registering 1,385 and 191 instruments per 10,000 adults, respectively.
The highest number of operating POS devices was in Tehran Province. There were 1.72 million operating POS devices in the sprawling capital, indicating 1.20% hike compared to the month before.
Tehran was followed by Khorasan Razavi with 629,912 and Isfahan with 575,400 operating devices.
With 60,130 devices, Ilam Province was at the bottom end of the list of provinces with the lowest number of active POS devices.
