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Emerging Opportunities in Estonias Cards and Payments Industry: Market Size, Trends and Drivers, Strategies, Products and Competitive Landscape

Published By :

Timetric

Published Date : Oct 2013

Category :

Banking

No. of Pages : 63 Pages


Synopsis

The report provides market analysis, information and insights on Estonia’s cards and payments market, including:

  • Current and forecast values for each category of Estonia’s cards and payments industry including debit cards, credit cards, prepaid cards and charge cards
  • Comprehensive analysis of the industry’s market attractiveness and future growth areas
  • Analysis of various market drivers and regulations governing Estonia’s cards and payments industry
  • Detailed analysis of the marketing strategies adopted for selling debit, credit, charge and prepaid cards used by various bankers and other institutions in the market
  • Comprehensive analysis of consumer attitudes and their buying preferences for cards
  • Competitive landscape of Estonia’s cards and payments industry

Executive summary

Estonia’s card payments channel exhibited negative growth during the review period (2008–2012), declining at a CAGR of -0.73% from 1.84 million cards in 2008 to 1.79 million cards in 2012. This can be attributed to the economic slowdown in the country during 2008–2011. Over the forecast period (2013–2017), the channel is expected to register a marginal growth at a CAGR of 0.25%, rising from 1.80 million cards in 2013 to 1.81 million cards in 2017. 

Estonia’s consumers are shifting from cash-based to cashless payments, although the pace of the shift was low during the review period due to the impact of the economic slowdown, but is expected gain momentum over the forecast period. The number of POS terminals increased from 24,133 in 2008 to 27,651 in 2012, at a CAGR of 3.46%. In contrast, the number of ATM machines declined from 1,018 in 2008 to 934 in 2012. This indicates a decline in the use of cards for cash withdrawals, and higher use of cards for retail purchases.

Scope

  • This report provides a comprehensive analysis of Estonia’s cards and payments industry
  • It provides current values for Estonia’s cards and payments industry for 2012 and forecast figures for 2017
  • It details the different macroeconomic, infrastructural, consumer and business drivers affecting Estonia’s cards and payments industry
  • It outlines the current regulatory framework in the industry
  • It details the marketing strategies used by various bankers and other institutions
  • It profiles the major banks in Estonia’s cards and payments industry

Reasons to buy

  • Make strategic business decisions using historic and forecast market data related to Estonia’s cards and payments industry and each market within it
  • Understand the key market trends and growth opportunities within Estonia’s cards and payments industry
  • Assess the competitive dynamics in Estonia’s cards and payments industry
  • Gain insights into the marketing strategies used for selling various types of cards in Estonia
  • Gain insights into key regulations governing Estonia’s cards and payments industry

Key highlights

  • Estonia’s consumers are shifting from cash-based to cashless payments, although the pace of the shift was low during the review period due to impact of the economic slowdown, but is expected gain momentum over the forecast period.
  • Estonia’s card payments channel is dominated by foreign banks. The combined market shares of foreign operators such as Swedbank, SEB Pank, Sampo (wholly owned by Danske) and Nordea accounted for 90% of the banking industry in 2012. In terms of number of cards in circulation, Swedbank accounted for 63.2% of the debit cards category in 2011 with 889,663 cards, followed by SEB Pank with 25.8%.
  • By the end of December 2012, the number of internet users in Estonia reached 1.1 million users, representing an internet penetration of 83.2%. The Estonian government offers a range of public online services such as electronic voting, online healthcare and online banking through state owned banks. Additionally, consumers are offered a range of e-government services such as legal aid, education services and company registration.
  • To increase the channel share of card payments, banks and issuers are adopting new product and pricing strategies with the aim of attracting larger customer bases. Incentives offered by banks include discounts at participant retail outlets, rewards points and increased daily limits for cash withdrawals. Banks are also segmenting their customer bases target specific customer groups.
Table of contents

1 Executive Summary

2 Market Attractiveness and Future Prospects of Cards and Payments Industry

3 Analysis of Cards and Payments Industry Drivers
3.1 Infrastructure Drivers
3.1.1 Increasing number of internet users
3.1.2 Enhanced payment solutions with NFC technology
3.1.3 EMV migration for secure card payments
3.1.4 Growing number of POS terminals
3.2 Business Drivers
3.2.1 Retail sale encouraged by consumer confidence
3.2.2 Growing number of outbound departures
3.2.3 Increased adoption of card payments
3.3 Consumer Drivers
3.3.1 Improving consumer confidence with growing wages
3.3.2 Increasing per capita income
3.4 Macroeconomic Drivers
3.4.1 Stable GDP growth
3.4.2 Declining unemployment
3.4.3 Higher proportion of urban population
3.5 Card Fraud Statistics
3.6 Regulatory Framework

4 Emerging Consumer Attitudes and Trends
4.1 Market Segmentation and Targeting
4.1.1 Retail customers
4.1.2 Corporate customers
4.2 Consumer Preferences
4.2.1 Price
4.2.2 Services
4.2.3 Convenience
4.3 Online Buying Behaviour

5 Competitive Landscape and Industry Dynamics
5.1 Overview of the Payment Channels
5.1.1 Credit transfers
5.1.2 Direct debits
5.1.3 Card payments
5.1.4 Check payments
5.2 Debit Cards Category Share
5.2.1 By bank
5.2.2 By scheme
5.3 Credit Cards Category Share
5.3.1 By bank
5.3.2 By scheme
5.4 Charge Cards Category Share

6 Strategies Adopted by Key Operators
6.1 Market entry strategies
6.2 Marketing and Product Strategies
6.2.1 Debit cards
6.2.2 Credit cards
6.3 Pricing Strategies

7 Size and Growth Potential of Card Payments Channel
7.1 Channel Share Analysis by Types of Card
7.2 Total Channel Size and Forecast of the Card Payments Channel
7.2.1 Analysis by number of cards
7.2.2 Analysis by transaction value
7.2.3 Analysis by transaction volume
7.3 Debit Card Category Size and Forecast
7.3.1 Analysis by number of cards
7.3.2 Analysis by transaction value
7.3.3 Analysis by transaction volume
7.3.4 Other key performance indicators
7.4 Charge Card Category Size and Forecast
7.4.1 Analysis by number of cards
7.4.2 Analysis by transaction value
7.4.3 Analysis by number of transactions
7.4.4 Analysis by frequency of use
7.5 Credit Card Category Size and Forecast
7.5.1 Analysis by number of cards
7.5.2 Analysis by transaction value
7.5.3 Analysis by transaction volume
7.5.4 Other key performance indicators

8 Company Profiles, Product, and Marketing Strategies
8.1 AS SEB Pank (SEB)
8.1.1 Key financials
8.1.2 Card portfolio
8.1.3 Strategies
8.2 Nordea Bank Estonia
8.2.1 Card portfolio
8.2.2 Strategies
8.3 Swedbank AS
8.3.1 Key financials
8.3.2 Card portfolio
8.3.3 Strategies

9 Appendix
9.1 Methodology
9.2 Definitions
9.1 Contact Timetric
9.2 About Timetric
9.3 Timetric’s Services
9.4 Disclaimer

List of Table


Table 1: Cards Offered to Corporate Companies in Estonia
Table 2: Estonian Payment Channels (EUR Million), 2008 and 2012
Table 3: Co-branded Cards in Estonia
Table 4: Charges on Debit Card Products in Estonia
Table 5: Charges on Credit Card Products in Estonia
Table 6: Estonian Card Payments Channel by Category of Card (Thousand), 2008–2017
Table 7: Estonian Card Payments Channel Size by Number of Cards (Thousands), 2008–2017
Table 8: Estonian Card Payments Channel Size by Transaction Value (EUR Billion), 2008–2017
Table 9: Estonian Card Payments Channel Size by Transaction Value (US$ Billion), 2008–2017
Table 10: Estonian Card Payments Channel Size by Number of Transactions (Million), 2008–2017
Table 11: Estonian Debit Cards Category – Size by Number of Cards (Thousands), 2008–2017
Table 12: Estonian Debit Cards Category – Size by Value of Transactions (EUR Billion), 2008–2017
Table 13: Estonian Debit Cards Category – Size by Value of Transactions (US$ Billion), 2008–2017
Table 14: Estonian Debit Cards Category – Size by Number of Transactions (Million), 2008–2017
Table 15: Estonian Debit Cards Category – Frequency of Use, 2008–2017
Table 16: Estonian Charge Cards Category – Size by Number of Cards (Thousands), 2008–2017
Table 17: Estonian Charge Cards Category – Size by Transaction Value (EUR Million), 2008–2017
Table 18: Estonian Charge Cards Category – Size by Transaction Value (US$ Million), 2008–2017
Table 19: Estonian Charge Cards Category – Size by Number of Transactions (Million), 2008–2017
Table 20: Estonian Charge Cards Category – Frequency of Use, 2008–2017
Table 21: Estonian Credit Cards Category – Size by Number of Cards (Thousands), 2008–2017
Table 22: Estonian Credit Cards Category – Size by Transaction Value (EUR Million), 2008–2017
Table 23: Estonian Credit Cards Category – Size by Transaction Value (US$ Million), 2008–2017
Table 24: Estonian Credit Cards Category – Size by Number of Transactions (Million), 2008–2017
Table 25: Estonian Credit Cards Category Frequency of Use, 2008–2017
Table 26: Estonian Credit Cards Category – Size by Average Transaction Value (EUR), 2008–2017
Table 27: Estonian Credit Card Category – Size by Average Transaction Value (US$), 2008–2017
Table 28: AS SEB Pank’s Key Financial Indicators (EUR Million), 2011 and 2012
Table 29: AS SEB Pank – Cards Offered and Key Features
Table 30: Nordea Bank Estonia – Cards Offered and Key Features
Table 31: Swedbank’s Key Financial Indicators (EUR Million), 2011 and 2012
Table 32: Swedbank AS – Cards Offered and Key Features
Table 33: Key Definitions

List of Chart


Figure 1: Growth of Various Card Categories in Estonia, 2008–2017
Figure 2: Growth Drivers of the Cards and Payments Industry in Estonia
Figure 3: Internet Penetration in Estonia (%), 2008–2012
Figure 4: Number of POS Terminals in Estonia (Thousands), 2008–2017
Figure 5: Estonian Number of Outbound Travelers (Thousands) and Spending (US$ Million),
Figure 6: Per Capita Income in Estonia (EUR), 2008–2017
Figure 7: GDP Growth Rate (%) in Estonia, 2008–2017
Figure 8: Urban vs Rural Populations in Estonia (%), 2012
Figure 9: Estonian Card Fraud Statistics (EUR Thousand), 2008–2012
Figure 10: Customer Segmentation of the Card Payments Channel in Estonia
Figure 11: Distribution of Population by Age Group in Estonia, 2012
Figure 12: Shares of Key Payment Channels in Estonia (%), 2008 and 2012
Figure 13: Value and Growth of Credit Transfer Transactions in Estonia (EUR Billion), 2008–2012
Figure 14: Value and Growth of Direct Debit Transactions in Estonia (EUR Million), 2008–2012
Figure 15: Value and Growth of Card Payment Transactions in Estonia (EUR Billion), 2008–2012
Figure 16: Value and Growth of Check Payment Transactions in Estonia (EUR Million), 2008–2012
Figure 17: Estonian Debit Cards Category Share by Bank (%), 2011
Figure 18: Estonian Debit Cards Category Share by Scheme (%), 2011
Figure 19: Estonian Credit Cards Category Share by Bank (%), 2011
Figure 20: Estonian Credit Cards Category Share by Scheme (%), 2011
Figure 21: Estonian Charge Cards Category Share by Scheme (%), 2011
Figure 22: Banks’ Market Shares in Estonia by Value of Assets (%), 2012
Figure 23: Estonian Card Payments Channel by Category (%), 2008–2017
Figure 24: Estonian Card Payments Channel Size by Number of Cards (Thousands), 2008–2017
Figure 25: Estonian Card Payments Channel Size by Transaction Value (EUR Billion), 2008–2017
Figure 26: Estonian Card Payments Channel Size by Number of Transactions (Million), 2008–2017
Figure 27: Estonian Debit Cards Category – Size by Number of Cards (Thousands), 2008–2017
Figure 28: Estonian Debit Cards Category – Size by Value of Transactions (EUR Billion), 2008–2017
Figure 29: Estonian Debit Cards Category – Size by Number of Transactions (Million), 2008–2017
Figure 30: Estonian Debit Cards Category – Frequency of Use, 2008–2017
Figure 31: Estonian Debit Card Transactions at ATMs and POS Terminals (Million), 2008–2017
Figure 32: Estonian Charge Cards Category – Size by Number of Cards (Thousands), 2008–2017
Figure 33: Estonian Charge Cards Category – Size by Transaction Value (EUR Million), 2008–2017
Figure 34: Estonian Charge Cards Category – Size by Number of Transactions (Million), 2008–2017
Figure 35: Estonian Charge Cards Category – Frequency of Use, 2008–2017
Figure 36: Estonian Credit Cards Category – Size by Number of Cards (Thousands), 2008–2017
Figure 37: Estonian Credit Cards Category – Size by Transaction Value (EUR Million), 2008–2017
Figure 38: Estonian Credit Cards Category – Size by Number of Transactions (Million), 2008–2017
Figure 39: Estonian Credit Cards Category – Frequency of Use, 2008–2017
Figure 40: Estonian Credit Card Category – Size by Average Transaction Value (EUR), 2008–2017

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