Late last year, QIWI Wallet, Russia’s prime cash-based wallet introduced its plastic card. Today, Yandex Money, another leading payments system, responded with a plastic card of its own, and it does some elements in its own way.
It deepens the Yandex relationship with MasterCard (whereas QIWI is using Visa). Yandex was already doing MasterCard Virtual Prepaid cards, so there’s probably nothing new for them to proceed with a plastic version, yet here they had to make the prepaid reloadable and find an issuer.
They had solved both problems with Tinkoff Credit Systems – a credit card specialist. My understanding is that the bank issues reloadable cards and serves as clearing agent between the user and Yandex, debiting and crediting the account based on the Yandex Money wallet balance.
The project is of interest for both parties involved. For Yandex, it closes the last mile to deliver (and cash out) good revenues flown between IT freelancers and web ‘prosumers’ that are using e-wallets rather than cards to transact over the web. It’s a good test for Yandex as a potential offline player, starting with cards and perhaps mulling some projects with taxi operators and other online/offline venues.
For Tinkoff, it’s a continuous trial of integrating itself with the web, first offering a co-branded card nearly two years ago with one of Russia’s major social networks (that gave users different perks), now studying volumes of the leading e-wallet scheme.
I wouldn’t dismiss the possibility of the two dallying to a full-blown merger (based on persistent rumors of Yandex Money planning to sell itself).
UPD: another important aspect addressing an increasing competition (rivalry) between Yandex and QIWI is that QIWI Visa Plastic charges customer with 1,5% when doing transactions over the web, where Yandex Card doesn’t. This might come as intending discount (where QIWI just secures the profitability of the business model from processing charges on low-level payments).
– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. You can read the original article here.