The key facts
- The P2P transfer chain involves fees of a bank, a processing system and a payment organization, whose sum makes up the final rate
- A 'zero fee' does not mean no costs — many organizations cover it as a marketing expense
- Banks can make transfers free thanks to other revenue sources, while payment organizations operate on a low-margin fee model
Roundtable on fees held at the Central Bank
On October 15, a roundtable dedicated to fees in financial services was held at the Central Bank. Representatives of banks and payment organizations explained, from the standpoint of their business models, why card-to-card transfer rates differ across various apps and who covers the cost of free transfers. In practice, one app offers transfers for free, another charges no fee up to a certain limit, and a third charges for every transfer.
A zero fee does not mean no costs
According to Click founder and CEO Ulugbek Rustamov, several participants serve a card-to-card transfer — a bank, a processing system and a payment organization. The fee paid by the customer is tied to the payments in this chain and the costs of providing the service. An organization offering free transfers to customers takes these costs upon itself. 'Every single P2P involves a processing system, a bank and a payment organization. The sum of the fees of all of these is what currently makes up this fee. Someone offering a zero fee does not simply mean they are giving up the profit they earn. Many treat this as a marketing expense,' Rustamov said.
Difference between revenue models of banks and payment organizations
Rustamov emphasized that banks and payment organizations have different revenue opportunities. A bank earns in other areas besides its relationship with the customer and can therefore make transfers free. Click, however, relies more on fees in card-to-card transfers: 'We are a payment organization. A payment organization is a company operating on a very low margin, on a very small fee. We have no other income besides this fee,' he said. According to him, if the company issued loans or circulated customer funds, it would be able to cover the fee.
For banks, transfers are not the only revenue source
Rustamov cited banks' ability to use customers' card funds as a resource as one of the ways to finance free transfers. A bank's goal is not limited to earning from a single transfer: a customer using its card and keeping their money in that bank also benefits the bank.
