Azerbaijani lawmaker calls for lower POS transaction fees

Reducing fees on point-of-sale (POS) terminal transactions in Azerbaijan could encourage wider use of cashless payments and lower operating costs for micro and small businesses, lawmaker Vugar Bayramov said.

Existing tariffs discourage some entrepreneurs from using cashless payment methods, he said.

The number of POS terminals in Azerbaijan has increased 3.2-fold since 2020 to 184,400, with 62.1% located in Baku, according to Bayramov.

“Currently, there are 60 people per POS terminal. In Georgia, one POS terminal serves 29 people, while in Turkey the figure is 47,” he said.

The number of bank cards in circulation is also continuing to rise, reaching 22.8 million at the end of May 2026, up 3.8 times over the past decade, Bayramov said.

He said POS transaction fees in Azerbaijan were higher than in several regional countries.

According to the lawmaker, Mastercard interchange rates for debit and prepaid cards are 0.65% in Turkey and range from 0.9% to 1.3% in Kazakhstan. The corresponding rates in Azerbaijan range from 1.14% to 1.73%.

For standard customer cards, the rates are 1.3–1.8% in Azerbaijan, 1.32% in Turkey, 1–1.75% in Georgia and 0.9–1.1% in Kazakhstan, he said.

Bayramov said high fees increase business costs and could ultimately affect prices.

“Micro-entrepreneurs currently benefit from a simplified turnover tax rate of 2%. However, the overall tariffs for using POS terminals are even higher than the tax rate. This means that in some cases, a micro-entrepreneur who prefers cashless payments and wants to operate transparently has to pay banks more for POS terminal services than in taxes. This reduces micro-entrepreneurs’ interest in cashless settlements. POS terminal fees should not be an obstacle to bringing the economy out of the shadows,” he said.

Bayramov called on the Central Bank to review POS transaction tariffs and take steps to reduce fees. He also said expanding the domestic interchange system and optimising fees for card transactions could help promote cashless payments.

In his view, these measures could encourage businesses to adopt cashless payments, improve economic transparency and create conditions for lower prices.

Gulnar Nazimqizi