21.10.2020 Ankara
According to the Spending Survey of Visa and the Union of Chambers and Commodity Exchanges of Turkey (TOBB), card spending in Turkey, which narrowed in March-May, entered a rapid recovery with normalization.
Card payments were 18% above the 2019 level as
of the last week of August. The study also compared spending data from Sweden
and Italy with Turkey's. He pointed out that Turkey is going through this process
with less damage compared to Europe and sectors are recovering more quickly.
Visa and the Union of Chambers and Commodity
Exchanges of Turkey (TOBB) conducted a study examining the COVID-19 effect on
card spending in Turkey.
Focusing on the period March-August 2020, the
study analyzed changes in card spending due to the COVID-19 process for
different sectors, non-contact transactions and e-commerce transactions. Total
card spending shrunk by 10% compared to the same period last year during the
12-week period (March-May) when curfews were imposed in Turkey due to the
outbreak. In June, as normalization began, spending began a rapid recovery and
rose 18% above the 2019 level in the last week of August.
- Turkey compared to two extreme countries in
pandemic restrictions, Sweden and Italy
The Visa and TOBB Expenditures Survey also
includes comparisons with the two countries that took a different approach
during the epidemic: Italy, which first implemented curfews in Europe, and
Sweden, which did not impose restrictions. Between March and May, Italy
experienced the sharpest declines in card spending, while In April and May,
Turkey and Sweden experienced parallel and close fluctuations. Sweden and Italy
continued to shrink by 13% in June, while Turkey grew by 10% with normalization
in the same month, recovering quickly, compared with the tables of the six main
spending sectors a year ago.
- Turkey tops Europe in contactless transaction
growth
Turkey was the first country in Europe to raise
the limit on contactless spending during the pandemic process. Consumers also
showed a growing demand for contactless payments due to health priority.
According to Interbank Card Centre figures, 2.5 million cards were used for
contactless payments for the first time in March only. Thus, in Turkey, the
number of contactless transactions in the first 6 months of 2020 increased
threefold compared to the same period last year. The Visa and TOBB Expenditures
Survey also reveals the figure of this increase very clearly. With the growth
rate of contactless payments, Turkey stands out as the country with the highest
increase in Europe. However, the rate of contactless transactions in our
country is lower compared to the European average, where 75% of face-to-face
payments occur without contact. To further popularize the acceptance of
contactless payments, Visa continued its work even during the pandemic period
and implemented close to 7000 contactless payment points in cooperation with
retail brands.
- E-commerce hits record highs
During the period covered by the research,
e-commerce transaction customs in our country increased by 30% in April 2020
only as consumer habits changed. In 14 European countries, the figure has
increased by more than 25%. In Turkey, 7
million cards were used for e-commerce transaction for the first time between
March and May. As a result, e-commerce in our country reached record levels,
reaching 33% of card spending as of the end of May.
- Spending figures outperforming many sectors
in 2019 with normalization
On-demand consumption expenditures such as
clothing, travel, electrical and electronics were above basic necessity
expenditures such as grocery stores and food before the pandemic, while
spending in these sectors fell by around 58% in March, when the first COVID-19
case in Turkey was seen. However, with normalization, 'on-demand consumption'
expenditures began to recover, especially with the increase in
electrical-electronics and building-decoration expenditures and the improvement
in other sectors and approached the level of basic needs expenditures again.
- Increased demand for the electrical and
electronics sector during the period of working from home and distance
education
During the period of curfews (March-May), the
sectors experiencing increased demand compared to last year were
electrical-electronic goods-computers, grocery stores and food. During this
period, there were decreases in the categories of travel, food, clothing and
fuel. With the start of remote work and remote education in March, the significant
increase in spending on electrical-electronics and building-decoration was
noted. In particular, electronics spending continued to increase in
June-August, with 2019 at over 95%, pointing to the persistency of this demand.
- “Turkey's proactive approach limited the
effects of the pandemic”
Evaluating the results of the research, TOBB
President M. Rifat Hisarcıklıoğlu said, “During the pandemic, the whole world
faced an environment which it was not accustomed to at all. Countries that are
prepared and proactive to adapt to this new medium have positively
differentiated from other countries. Turkey has been one of the most prominent
countries in the world in adapting to this new medium by making quick decisions
during the pandemic process and especially with the breakthroughs it has made
in the field of health. We have seen the
reflection of this in concrete both with the emergence of e-commerce in this
process and with the increase in contactless payments.”
Stating that they are in constant communication
with Chambers-Exchanges, Sector Councils, Women and Young Councils and OIZs during
the pandemic, Hisarcıklıoğlu said, “Throughout the pandemic, we closely
followed the problems of our members with the consultation mechanisms we
established in the field, receiving constant updates. We have followed up on
the solution of these problems by developing solution proposals and forwarding
them to the relevant public institutions and organizations. In this period, I
can say that many problems from our members have been solved with this method.
Again, we have seen that the proactive steps taken during this period
accelerated the normalization process.”
Hisarcıklıoğlu concluded, “The pandemic showed
us once again the importance and future of e-commerce. During this period, we
saw that one-third of credit card spending was made through e-commerce. We have
organized many online information meetings to prepare our members for
e-commerce. In addition, we have introduced certified e-commerce and e-export
training programs for our members to take part in e-commerce; we have prepared
e-commerce-specific campaigns with many companies and made them available to
our members.”
- “A positive outlook for Turkey”
Visa Turkey General Manager Merve Tezel said, “Visa
and TOBB's Spending Survey shows a positive outlook for Turkey. With the start
of the normalization process in our country, we see a faster recovery in all
sectors compared to Europe. The prevalence of payment systems in Turkey,
consumers' card usage habits and strong e-commerce infrastructures played an
important role in the recovery.”
Tezel added: “The pandemic process has led to
significant changes in both consumer behavior and the structure of businesses.
During this period, consumers turned to online payments in virtual environments
and contactless payments in the physical world. Contactless card usage in our
country normally grows by 2 times each year on average, while in only the first
6 months of this year it has grown 3-fold. We also observed that the acceptance
of contactless payments can result in increases in turnover in some workplaces.
We expect contactless card usage rates in Turkey to reach the European level.”
Tezel said that the transformation from cash to
card payment also contributed to the registered economy, “On the business side,
we saw that this process was easier for small and medium-sized companies that
accepted electronic payment methods during the pandemic and took their business
to digital media. During this period, Visa continues our support for SMEs that
form the backbone of the economy within the scope of our I Manage My Business Project,
both with the virtual trainings we offer and with the support of digitalization
and digital marketing.”