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The Cards and Payments Industry in Czech Republic: Emerging trends and opportunities to 2020

The Cards and Payments Industry in Czech Republic: Emerging trends and opportunities to 2020

Summary

Cash remains the preferred method of consumer payment, accounting for 56.2% of the total transaction volume in 2016. Consumers in the Czech Republic generally use cash for day-to-day, low-value transactions. However, its use declined during the review period due to a growing preference for payment cards and an increase in contactless transactions.

Czech economy has registered robust growth since 2014, supported by a decline in oil prices, increased investment activity, and government policy to encourage exports and domestic demand. Economic growth and disposable incomes are expected to accelerate over the forecast period (2016-20), which will drive investment in the country’s cards and payments industry.

Payment cards market grew significantly in the Czech Republic during the review period (2012-16), as consumers are increasingly spending more with their payment cards. The total number of payment card transactions increased at a CAGR of 15.8% from 480.6 million in 2012 to 865.1 million in 2016.The Czech Republic’s payment card penetration (cards per inhabitant) was 1.1 in 2016, which is high compared with its peers Slovakia (1.0), Bulgaria (1.0), Hungary (0.9), Poland (0.9) and Romania (0.8). The high penetration of payment cards offers further scope for growth in the country’s cards and payments market.

The total transaction value of the e-commerce market posted a review-period CAGR of 32.2%, from $2.0bn (CZK52.9bn) in 2012 to $6.3bn (CZK161.8bn) in 2016. A high mobile penetration rate, consumer confidence in online transactions, and the presence of a secure online gateway were responsible for driving this growth. According to Ecommerce Europe, 80.0% of the Czech population above the age of 14 years - equivalent to 7.1 million individuals - use the internet, and 3.7 million shops online.

Banks and other card participants are introducing innovative payment options to encourage electronic payments and improve convenience in online shopping. For example, UniCredit Bank launched the Pay button on its internet banking platform in December 2015. The bank, in association with online payment service provider PayU, offers the new payment option when consumers make payments on e-commerce and price comparison websites, including Mall.cz and Heureka.cz. Similarly, Mastercard launched MasterPass in the Czech Republic in November 2014.

The report The Cards and Payments Industry in Czech Republic: Emerging trends and opportunities to 2020 provides top-level market analysis, information and insights into the Czech Republic's cards and payments industry.

In particular, this report provides the following analysis -

  • Current and forecast values for each market in the Czech Republic's cards and payments industry, including debit, credit and charge cards.
  • Detailed insights into payment instruments including credit transfers, cheques, cash, direct debit and payment cards. It also, includes an overview of the country's key alternative payment instruments.
  • E-commerce market analysis and payment methods.
  • Analysis of various market drivers and regulations governing the Czech Republic's cards and payments industry.
  • Detailed analysis of strategies adopted by banks and other institutions to market debit, credit and charge cards.
Companies mentioned in this report: CSAS, CSOB, Komerční banka, MONETA Money Bank, Raiffeisen Bank, Visa, Mastercard, Diners Club.

Scope
  • Contactless payments are gaining prominence in the Czech Republic, with all major banks - Česká spořitelna (CSAS), Československá obchodní banka (CSOB), Komerční banka, MONETA Money Bank, and Raiffeisen Bank - offering contactless debit/credit cards. Overall, the number of cards with contactless functionality reached 10.9 million in 2016. Komerční banka launched a contactless debit card in collaboration with Visa in February 2014. The card enables consumers to pay without inserting the card or entering a PIN at point-of-sale (POS) terminals for payments of up to $19.45 (CZK500). In November 2015, the bank announced the installation of 6,000 contactless-capable POS terminals across the Czech Republic. In December 2016, Ingenico partnered with Dallmayr - a vending machine operator - to introduce contactless functionality in 50 coffee vending machines across the city of Prague.
  • Alternative payments are gradually gaining prominence in the country, with the availability of a number of popular payment solutions including Paysafecard, PayPal, and MasterPass. Mastercard launched its digital wallet MasterPass in the Czech Republic in November 2014. In December 2015, Mastercard extended its MasterPass payment platform to FreshDirect, an online fresh food supplier. In November 2016, Mastercard collaborated with Shell Czech Republic to enable customers to pay using the MasterPass QR code feature at Shell fuel stations. Similarly, in August 2016 CSOB - a Bulgarian commercial bank, collaborated with SIA - an electronic payments provider - to launch the NaNákupy mobile wallet, allowing users to make NFC payments.
  • To provide card holders with enhanced security measures, banks and card issuers are implementing biometrics authentication. In February 2016, VoiceKey - an integrated voice biometrics authentication feature - was launched by Worldcore. The solution can be used by consumers to access their bank accounts and authenticate payments. Consumers register a voice sample, and VoiceKey can then analyze a voice-password by 100 parameters to eliminate the chance of fraudulent access.
Reasons to buy
  • Make strategic business decisions, using top-level historic and forecast market data, related to the Czech Republic's cards and payments industry and each market within it.
  • Understand the key market trends and growth opportunities in the Czech Republic's cards and payments industry.
  • Assess the competitive dynamics in the Czech Republic's cards and payments industry.
  • Gain insights into marketing strategies used for various card types in Czech Republic.
  • Gain insights into key regulations governing the Czech Republic's cards and payments industry.


  • Executive Summary
    • Market overview
    • Key facts
      • Table Czech Republic: key facts, 2016
      • Table Czech Republic: regional benchmarking of payment cards, 2016
    • Top five industry events
  • Payment Instruments
    • Current payment environment
      • Table figure 1: Czech Republic: payment instrument shares by transaction value (%), 2012 vs 2016
      • Table figure 2: Czech Republic: payment instrument shares by transaction volume (%), 2012 vs 2016
  • E-Commerce and Alternative Payments
    • E-commerce market analysis
      • Table figure 3: Czech Republic: e-commerce value, 2012–20f
    • Alternative payment solutions
      • PayPal
      • MasterPass
      • Paysafecard
      • Nanakupy
      • Visa Wallet
      • O2 direct carrier billing
  • Regulations in the Cards and Payments Industry
    • Regulatory framework
      • SEPA cards framework
      • Guidelines and requirements of the Payment Services Directive
      • Interchange fee regulation
    • Anti-money laundering
    • Foreign direct investment (FDI) regulations
      • Table Czech Republic: mode of entry of foreign banks
  • Analysis of Cards and Payments Industry Drivers
    • Table figure 4: Czech Republic: population and economic indicators
    • Table figure 5: Czech Republic: ATMs, POS terminals, and household consumption
  • Payment Cards
    • Table figure 6: Czech Republic: payment cards transaction value and cards in circulation, 2012–20f
  • Debit Cards
    • Debit cards market analysis
      • Table figure 7: Czech Republic: debit card penetration and turnover per card
    • Competition in the debit card market
      • Table figure 8: Czech Republic: debit card scheme and issuer transaction value share, 2016
    • Debit cards comparison
      • Table Czech Republic: debit card comparison and key features, 2016
  • Pay-later Cards
    • Pay-later cards market analysis
      • Table figure 9: Czech Republic: pay-later card penetration and turnover per card
    • Competition in the pay-later cards market
      • Table figure 10: Czech Republic: pay-later card scheme and issuer transaction value share, 2016
    • Pay-later cards comparison
      • Table Czech republic: gold credit card comparison and key features, 2016
      • Table Czech Republic: premium credit card comparison and key features, 2016
      • Table Czech Republic: charge cards comparison and key features, 2016
  • Prepaid Cards
    • Table figure 11: Czech Republic: prepaid cards in circulation and transaction value, 2012–20f
  • Appendix
    • Abbreviations and acronyms
    • Supplementary data
      • Table Czech Republic: payment instrument transaction values (CZKbn), 2012–16e
      • Table Czech Republic: payment instrument transaction values ($bn), 2012–16e
      • Table Czech Republic: payment instrument transaction volumes (millions), 2012–16e
      • Table Czech Republic: payment cards in circulation by type (millions), 2012–20f
      • Table Czech Republic: volume of payment card transactions (millions), 2012–20f
      • Table Czech Republic: value of payment card transactions (CZKbn), 2012–20f
      • Table Czech Republic: value of payment card transactions ($bn), 2012–20f
      • Table Czech Republic: debit cards in circulation (millions), 2012–20f
      • Table Czech Republic: debit card transaction volumes, 2012–20f
      • Table Czech Republic: debit card transaction values (CZK), 2012–20f
      • Table Czech Republic: debit card transaction values ($), 2012–20f
      • Table Czech Republic: debit cards in circulation by scheme (000s), 2012–16e
      • Table Czech Republic: debit card transaction values by scheme (CZKm), 2012–16e
      • Table Czech Republic: debit card transaction values by scheme ($m), 2012–16e
      • Table Czech Republic: debit card transaction values by issuer (CZKbn), 2012–16e
      • Table Czech Republic: debit card transaction values by issuer ($bn), 2012–16e
      • Table Czech Republic: pay-later cards in circulation (millions), 2012–20f
      • Table Czech Republic: pay-later card transaction volumes, 2012–20f
      • Table Czech Republic: pay-later card transaction values (CZK), 2012–20f
      • Table Czech Republic: pay-later card transaction values ($), 2012–20f
      • Table Czech Republic: pay-later cards in circulation by scheme (000s), 2012–16e
      • Table Czech Republic: pay-later card transaction values by scheme (CZKbn), 2012–16
      • Table Czech Republic: pay-later card transaction values by scheme ($m), 2012–16e
      • Table Czech Republic: pay-later card transaction values by issuer (CZKbn), 2012–16e
      • Table Czech Republic: pay-later card transaction values by issuer ($m), 2012–16e
      • Table Czech Republic: credit cards in circulation (millions), 2012–20f
      • Table Czech Republic: credit card transaction volumes, 2012–20f
      • Table Czech Republic: credit card transaction values (CZK), 2012–20f
      • Table Czech Republic: credit card transaction values ($), 2012–20f
      • Table Czech Republic: credit cards in circulation by scheme (000s), 2012–16e
      • Table Czech Republic: credit card transaction values by scheme (CZKm), 2012–16e
      • Table Czech Republic: credit card transaction values by scheme ($m), 2012–16e
      • Table Czech Republic: charge cards in circulation (000s), 2012–20f
      • Table Czech Republic: charge card transaction volumes, 2012–20f
      • Table Czech Republic: charge card transaction values (CZK), 2012–20f
      • Table Czech Republic: charge card transaction values ($), 2012–20f
      • Table Czech Republic: charge cards in circulation by scheme (000s), 2012–16e
      • Table Czech Republic: charge card transaction values by scheme (CZKm), 2012–16e
      • Table Czech Republic: charge card transaction values by scheme ($m), 2012–16e
      • Table Czech Republic: prepaid cards in circulation (000s), 2012–20f
      • Table Czech Republic: prepaid card transaction values (CZKm), 2012–20f
      • Table Czech Republic: prepaid card transaction values ($m), 2012–20f
    • Definitions
      • Table Key definitions
    • Methodology
    • Bibliography
    • Further reading

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