ASTANA – Mastercard’s Regional Hub for the Commonwealth of Independent States (CIS), Central and Eastern Europe in Almaty will focus on data and services, said Mastercard General Director for Central Asia Rafal Trepka in an interview with The Astana Times.
Originally from Poland, Rafal has been with Mastercard team for almost 15 years. Photo credit: Mastercard
Mastercard is a global fintech company working in more than 210 countries around the world and has been operating in the payments industry for over 50 years. The company’s processing network processes more than 160 million transactions per hour and 27 billion payments per year.
Mastercard began operating in Kazakhstan in the mid-90s, and in 2012 opened an office in Almaty.
Rafal Trepka has been appointed to oversee the region of Central Asia back in 2020. He is also the head of the newly established Mastercard Customer Solutions Center.
Regional hub
During his September visit to the United States, President Kassym-Jomart Tokayev met with Mastercard Executive Vice President Nicola Villa, endorsing the company’s decision to choose Almaty as a regional hub.
Executive Vice President of Mastercard Nicola Villa and President Kassym-Jomart Tokayev on Sept. 19 in New York. Photo credit: Akorda.
To facilitate this, a cooperation agreement was signed between the Ministry of Digital Development, Innovations, and Aerospace Industry and Mastercard. Under this agreement, with the advisory support of the ministry, Mastercard intends to develop and implement a five-year digital partnership program in Kazakhstan.
“We are very thankful, pleased and honored that it was additionally underlined by President Kassym-Jomart Tokayev in New York,” said Trepka. This, he noted, serves as a powerful motivation.
Almaty was chosen as a regional hub for the development of Mastercard’s consulting business. “The bottom line is to be close to the customers,” he said. “Majority of the banks are here in Almaty.”
There are other factors underpinning the selection of Almaty. Besides geographical proximity to the company’s offices in Istanbul and Dubai, the city also boasts well-educated young personnel.
The hub is part of the company’s ongoing efforts to expand. “We have our core business, which is the payment products – debit cards and credit cards. (…) But we are expanding to the services company. It is not just about the basic transaction but also how we can make this transaction not only fast and simple but very safe and secure,” said Trepka.
He also hinted at the necessity of delving deeper into data, not solely limited to artificial intelligence but encompassing the broader realm of data science. He underscored the critical role of data science, particularly in cybersecurity and cyber intelligence, emphasizing the imperative for security measures to swiftly analyze vast amounts of data, enabling quick and informed decision-making.
“That is why, in the end, we are developing an overall hub for the region in Kazakhstan, with the specific focus on this data and services, because that was the capability which was mostly missing on the market,” said Trepka.
The hub will be based in Almaty but is not limited geographically. It will be open to bringing knowledge and know-how from other countries.
“There is a lot of know-how and a lot of global technologies. Kazakhstan and the region do not have to reinvent the wheel,” he said.
Substantial young population
Not only Kazakhstan but also the entire region of Central Asia have a significant proportion of their population below the age of 30.
“The region is relatively young. You usually count the average age as way over the 40s [in Western countries]. In this region, 50% of the population is below 30, and 40% is below 25. There is a huge potential, especially when we talk from the technology perspective. It is very important,” said Trepka.
The company is very optimistic about the future of the region and sees ample opportunities for activity and cooperation in the countries of Central Asia.
Well-developed digital landscape
Trepka also commended rapid digital development in the country. Government tech is particularly “amazingly developed,” he added. In the 2022 United Nations (UN) Global E-Government Development Index for the development of electronic government, the nation ranked 28th.
“Companies from Kazakhstan go abroad to speak about what you can do. Banks usually have 50+ services in the mobile banking application, which you can do. It is not only to view the documents, have your registration, or do something with the car, but also apply for marriage [certificate] and do a lot of things for kids. That helps to serve people remotely,” he said.
Trends in the financial sector
Speaking about trends in the financial sector, Trepka underlined the staggeringly high volume of cashless transactions. According to him, over 80% of all transactions are cashless.
The volume of non-cash transactions in Kazakhstan reached a record level of 61.3 trillion tenge ($133.6 billion) in the first half of 2023, according to a report from the Association of Financiers of Kazakhstan, compared to 43.9 trillion tenge ($95.7 billion) in the same period in 2022. The number of debit cards in the first half of the year increased by 19.3% to 56 million.
Trepka also observed how trusting the society in Kazakhstan is and how very loyal it is to digital solutions. However, he noted the nation’s trusting nature becomes a double-edged sword, as it opens up possibilities for exploitation by fraudsters and cyber attackers on a global scale.
“Therefore, additional technologies in cyber intelligence and security are critical,” he added.
He stressed the critical need for increased interoperability as the next level of development in the payment market in Kazakhstan, shedding light on existing challenges and underscoring the importance of safety, security, and consumer awareness.
In a message directed at foreign companies entering the market, he also encouraged a focus on delivering high-quality customer service, stressing the importance of upholding promises, providing warranties, and ensuring customer satisfaction. This, he noted, could be a significant differentiator in a market where consumers are increasingly valuing not only the product but also the overall customer experience.
Partnership with Kazakhstan
Emphasizing the strategic importance of the ability to build relationships with various partners, he said Mastercard has been working closely with the government entities.
Under a five-year Digital Country Partnership program, the cooperation entails the promotion of Kazakhstan’s GovTech model using the global Mastercard network, digitalization of government payments, and cooperation on the development of IT exports, e-commerce, digitalization of small and medium-sized businesses and fintech.
In another example of an enduring partnership with Kazakhstan, he mentioned the launch of the digital tenge in November. The launch took place at the Financial Congress in Almaty and the first transaction was executed using bank cards powered by Mastercard.
Speaking about the company’s plans, Trepka said they are visionary but also realistic.
“We also see what is happening. In the next five years, we will probably see the evolution, which has probably been happening within the last 50 years – because of digitalization, because of the internet, because people are moving. The whole world is speeding up, and we have to adapt to that and be more agile,” he said.
The company’s strategic vision extends into the future with a focus on Web 3.0, emphasizing payments and products at a national level. Collaboration with government agencies can help foster initiatives such as an instant payment system, the digital tenge, and open banking. Trepka added their objective is to introduce these services in Kazakhstan through partnerships with the National Bank and second-tier banks.
