Some fintech companies in Azerbaijan may overtake banks in 2-3 years, AzFina chief says

Some fintech companies operating in Azerbaijan may surpass individual banks within the next two to three years, Edgar Abdullayev, chairman of the Board of the Azerbaijan Fintech Association, or AzFina, told Report.

Abdullayev said it was still difficult to say whether any fintech company in Azerbaijan could currently overtake a bank, as the licensed regulation of fintech companies in the country began only in May 2024.

"Banks, meanwhile, have many years of established financial and banking experience," he said.

However, he said the regulatory environment created by the Central Bank, the sandbox regime and the full development of open banking infrastructure could create conditions for some fintech companies to surpass certain banks in the future.

"In the most optimistic scenario, this would take two to three years," Abdullayev said.

He said open banking should allow users to manage their accounts at different banks and electronic money institutions through a single platform, which would significantly expand opportunities for cooperation in the financial market.

Abdullayev added that the broader use of the MyGov platform would also play an important role in the process.

"This is not only about financial transactions. It is also important that biometric identification and know-your-customer, or KYC, procedures are carried out through a single electronic platform," he said.

He said once these capabilities are fully in place, some fintech companies could outperform banks in certain service areas.