The amendments to the Cashback Law, regarding the introduction of electronic terminals from January 1, 2023 for merchants with annual cash receipts of over 10,000 euros (50,000 lei), led to a massive need for digital transformation for small and medium-sized companies, at the beginning of 2023.
Global Payments, the world’s largest provider of payment services and technology, recorded, in January of this year alone, 7 times more requests to install POS and software for accepting card payments than in the same month of 2022. Practic, the number of applications registered in half a year in 2022, was concentrated in a single month, in 2023.
In January, 95% of requests for Global Payments POS and GP tom (an app that turns your phone or tablet into a mobile POS) came from small businesses, with the rest from medium-sized businesses. Most are grocery or mixed stores, auto parts stores and service stations, restaurants, bars or cafes. Small and medium-sized companies represent over 99% of all enterprises in Romania and employ two thirds of all employees, being a key segment in local economy, but also in increasing the level of education and financial inclusion of local communities, especially in rural areas, where a large part of the population does not have access to infrastructure to use bank cards as a payment method.
“Ever since the appearance of the Cashback Law in Romania, in 2017, among the main objectives were the digitization of SMEs, increasing the degree of banking and reducing dependence on cash in rural areas and small towns. These beneficial effects of the law are visible now, with the reduction of the threshold to 10,000 euros/year, turnover for merchants. At the moment, 70% of the requests registered by Global Payments come from companies operating in less digitized areas. They are interested, especially in the speed with which we respond to their need to install electronic payment terrminale, in costs, especially in retail, because many transactions are made, but with little value, but also in alternative solutions for connection or data signal amplification. We also have the possibility to install terminals with Ethernet connection or via Wi-Fi connection, where problems are reported”, said Cătălin Moise, Country Manager Global Payments Romania.
Most requests for Global Payments electronic payment terminals come from Ilfov, Prahova, Dâmbovița, Galați or Bistrița-Năsăud counties. A significant number of requests came through the partner bank branches for which Global Payments offers payment services by card, through applications and online channels or through social media.
“Merchants are showing increasing interest in the GP tom app, which turns the mobile phone into a POS. At the end of last year, we had about 4000 mobile devices running the GP tom app. Almost 95% of transactions are contactless and are made at grocery stores and supermarkets, at hotels and resorts, at restaurants and fast foods, in auto parts stores or at dental practices. Ever since we launched this payment solution in Romania, in 2021, we have noticed a growing local preference for electronic payments. In our portfolio there are, at the moment, more than 220 categories of merchants who use our electronic payment solutions, whether they are GP tom or POSs”, declares Ionela Mitran, Deputy Sales Director, Global Payments Romania.
According to an analysis conducted by Global Payments for 2022, Romanians have maintained their affinity for electronic transactions acquired during the pandemic, reaching to make card payments worth over 6.3 billion lei (6.349 billion lei), with 84 million lei more than in the previous year. In total, Romanians made over 53 million electronic transactions in 2022, 12% more than in 2021, when there were about 47 million card payments.
The demand for payment acceptance systems was also evident in 2022, signalling an increased need for digital services as a result of changing paymentconsumers behaviour, much more oriented towards contactless and online payments. The number of customers from Romania with Global Payments card acceptance terminals or apps that turn their phone or tablet into a mobile POS (GP tom) grew by 27% last year to more than 14,000 merchants.