Visa, the leading global payments technology company, has welcomed today’s announcement from the Central Bank of Myanmar to remove restrictions on the participation of international payments companies in Myanmar’s domestic payments industry, according to a statement on 11 January.
According to Arturo Planell, Country Manager Visa Myanmar, opening up the domestic payments industry will bring significant benefits to consumers, businesses and the overall Myanmar economy.
“This is a landmark announcement that will enable the people of Myanmar to have access to electronic payments that are more convenient, secure and globally accepted. It will also accelerate the country’s shift from a cash based economy to a digital economy, supporting the Myanmar government’s national goals of inclusive economic growth, increased employment, and greater financial inclusion, while reducing the shadow economy,” said Arturo Planell, Country Manager, Visa Myanmar.
Visa is working with its client banks to launch Myanmar’s first Visa credit card for domestic and international use.
As domestic reforms are implemented and international sanctions lifted, Myanmar’s economy is opening up and becoming more globally integrated. GDP is forecast to grow at over 8.3% in 2016,1 and the cash-based economy will invariably face more international competition, enormous technology challenges and opportunities amidst rising demand from consumers.
Electronic payments in Myanmar are at an early stage of development. The first ATM in Myanmar was installed in November 2011. Although the country now has over 1,500 ATMs it is still a relatively low number given Myanmar’s population of more than 54 million. In comparison, Vietnam with its 90 million population has 17,330 ATMs as at July 2016, as reported by the State Bank of Vietnam.
Electronic payments help advance inclusive economic growth. The Moody's Analytics research commissioned by Visa found that increased use of electronic payment products, including credit, debit and prepaid cards, added US$296B to global GDP, while raising household consumption of goods and services by an average of 0.18 percent per year.
There are opportunities to create sustainable growth that will benefit all. Myanmar currently displays the lowest percentage increase in GDP in the region at 0.0004% per 1% increase in card penetration, and is also among the least frequent card users. Electronic payments added USD $40,000,000 to Myanmar’s economy from 2011 to 2015. Within Asia, Thailand (0.19%), Vietnam (0.14%), and Singapore (0.1%) experienced the largest weighted average increase in GDP due to increased card usage.
Since entering the country in 2012, Visa has seen considerable growth in the uptake of electronic payments. As the world’s largest retail electronic payments network, Visa helps connect Myanmar cardholders and businesses of all sizes to the world, particularly when it comes to outbound and inbound travels.
Visa also actively carries out activities to help grow the electronic payments infrastructure by increasing acceptance points in cities outside of Yangon. It is instrumental in educating bank partners on best practices such as risk management, and advancing financial and technological education for a more inclusive growth.
“Transforming cash economies to digital economies is a very promising route to financial inclusion and has already contributed to progress globally. We look forward to working with our clients, merchants and the Government to expand access to electronic payments across Myanmar,” added Mr. Planell.