An overview of the payment methods used in Russia

Banking in Russia is primarily regulated by the Central Bank of the Russian Federation (CBR), one of the few State institutions largely under the control of the Russian legislature, as opposed to the executive branch. This body is responsible for oversight of the entire financial segment of the Russian economy.

The foundations of the Russian banking system are provided by the territory’s federal laws, and the banking sector is subject to stringent regulation, though this has been relaxed somewhat in recent years. Financial institutions in Russia have to meet mandatory legislation requirements, as well as comply with numerous CBR instructions and regulations.

Regardless of the desired destination, an e-Retailer expanding internationally should always take steps to educate himself on the payment methods most commonly favoured by consumers in his chosen locale, as well as any practical steps necessary to facilitate them. Receiving payment for goods sold is, of course, as important as any other aspect of an online transaction.

As with many of the other topics covered in this Passport, Russia is unique in its payments landscape and time should be taken to research this area thoroughly, particularly as retailers in Russia are almost unanimous in the identification of this as a key area of difficulty. Research should be done well in advance of launching a digital shop - the facilitation of payment is an area which can make or break success in a region and as an online merchant, one cannot just enter the Russian market with a ‘basic’ web counter and a Russian bank. It is important to offer a tailor-made solution. Should it be required, varying degrees of third-party assistance, for example through the services of a specialised payments service provider, are available.

The dominance of cash on delivery

One of the most important points to note from the outset is that - in contrast to many other marketswithin the Russian Federation cash on delivery is by far the most commonly utilised payment method for ecommerce transactions involving physical goods, though its proportionate share is slowly decreasing. Though estimates vary, some 80-95% of all such transactions are paid for using cash on delivery, and putting mechanisms in place to facilitate this is a must when trading online in Russia. This can seem something of a headache for purely off-shore retailers; the absence of a local agent on the ground in the territory can significantly restrict the potential reach of an online shop’s appeal, particularly if that shop has no brand recognition in Russia.

Despite some initial hesitancy, overall many retailers into Russia report that they have discovered more or less satisfactory ways to cope with the demands of cash on delivery, unhindered by the method’s reputed negative effect on returns and extra resource strain. With sufficient attention and understanding, then, this peculiarity of the Russian market should not dissuade a digital entrepreneur.

Cash on delivery has retained its foothold in the Russian market for a variety of reasons, both historical and current. A long-standing wariness of distance sellers, electronic payment mechanisms and providers and financial institutions persists – particularly in the regions- meaning that Russians are very hesitant to disclose personal and financial information online for fear of being defrauded. Russia additionally still suffers from a relatively undeveloped interbank network and a somewhat precarious supply chain, and it is not uncommon for packages not to arrive at their destination, lost among the sheer volume of dispatches. Added to this is a perceived lack of transparency with regard to the actual availability of a product, which can entail long waiting times and/or the sending of goods not matching original product descriptions. For these reasons, it is not difficult to see why Russian citizens choose cash on delivery as their payment option of choice.

These considerations are also important when it comes to examining other popular online payment methods in Russia, many of which have been developed with these consumer concerns in mind.

Non-cash payments

Electronic payment systems in Russia are still largely in their infancy, and Russian e-Shoppers remain somewhat dubious of them. Despite this, however, systems and technology are establishing themselves quickly and attitudes to payments are changing. In the spring of 2014, TNS conducted an enlightening study into the knowledge and use of non-cash, electronic payment methods, surveying 2,800 Russian online shoppers. The results of this research have important implications for aspiring e-retailers into this territory.

Survey questions were directed at Russian residents between the ages of 12 and 55 who lived in cities with a population of more than 800,000, and all respondents surveyed used the internet at least once per week.

Upon being questioned on whether they had used a particular payment method in the previous six months, it because clear that -at least in these larger Russian cities -bank cards and e-Money were the most popular, non-cash online payment methods with 56% and 46% of respondents having used these methods at least once in the preceding six months, respectively. SMS payments and internet banking were also relatively popular payment methods amongst those surveyed.

The overall awareness of these different methods of electronic payment was high in all cases, with almost the complete set of respondents being familiar with e-Money and bank cards, which could indicate the increased use of these payment facilities in coming years as trust continues to build and Russia’s infrastructure develops.

Awareness of non-cash online payment methods:

e-Money – 97%

Bank cards – 96%

SMS-payments – 91%

Internet banking – 90%

The different electronic payment methods will now be explored in turn.


In recent years, electronic wallets have become an increasingly popular digital payment method in the Russian Federation, and Russian consumers have a variety of options to choose from. Yandex.Money, Qiwi, WebMoney and PayPal all have sizeable market shares, though the latter was only made available for domestic transactions in 2013 and has yet to gain a strong foothold in the Russian market; as with search and social networks, e-Wallets in Russia are dominated by local players.

e-Wallets, which transform cash into digital currency, provide an easy and safe way for consumers to make online payments in real time, and e-Retailers can integrate these payment solutions directly into their websites. Consumers register for the particular e-Money service on the provider’s designated website, and subsequently deposit money into their accounts. Deposits can be conducted in a variety of ways in all of Russia’s regions, for example via bank card, cash, bank transfer, ATM or through cash-in kiosks. Qiwi, importantly, provides both cash terminals and an e-Wallet service in partnership with Visa.

In their 2014 study (see ‘non-cash payments’, above), TNS further surveyed their Russian respondents on particular e-Wallets they had used at least once in the preceding six months when making online transactions.

The results are recorded in the chart immediately below.

The most commonly used electronic money service in Russia was reported to be Yandex.Money, with 22% of survey participants reporting the use of this digital wallet in the allotted timeframe. This was followed closely by Qiwi with 21% participant use.

The study examined studied brand awareness amongst respondents of these same e-Wallet providers, and Yandex.Money again came out on top.

Impressively, at the end of 2014 Yandex.Money and WebMoney each announced over 20 million users. Qiwi reported some 16.5 million users, and PayPal brought up the rear with 1.5 million users in Russia.

Importantly, for the purposes of this Passport, it should be noted here that TNS’ survey did not just report on e-Wallet payments for physical goods, but electronic currency use in all digital transactions.

Purchases made using electronic money differ with age, but some general points are worth noting here. For example, only around 54% of respondents aged 12-55 had used e-Wallets to make a purchase from an online shop in the preceding six months, and this proportion is likely to dip significantly in smaller Russian cities and towns. Older age groups are also more likely to pay for goods using e-money than their younger counterparts. Other popular purchases with electronic money include mobile services, internet access and home utilities.

In the near future, it is anticipated that increasing numbers of consumers will make use of e-currencies for the purchase of goods and services, but for the time being this will largely be for offerings at lower price points.

The historical Russian suspicion and banking institutions has overall meant a rapid rise in the use of these payment methods by consumers and merchants alike in Russia, and they are a key driver of ecommerce growth. However, every transaction using e-Wallets is accompanied by a commission amounting to 3-5% of a purchase price. For this reason, most e-Shoppers continue to prefer to pay cash on delivery. Regardless, for the reasons stated above, e-Wallet payments should be a payment option provided by e-Retailers into Russia.

Bank cards and online banking

Despite the high penetration rate of debit cards in the Russian Federation, as a whole bank cards are not used overwhelmingly either online or offline for making purchases. Instead, a significant proportion of card holders essentially use them to withdraw cash from their bank accounts after receiving their salary ; this activity accounted for an astonishing 92% of bank card transactions in 2013.

TNS’ 2014 study (see above) recorded that 56% of respondents surveyed had used bank cards as an electronic payment method in the six months preceding the survey –not a particularly impressive  statistic in itself when compared with other European markets – but this figure does not paint an entirely accurate picture as it is common knowledge that bank cards are more frequently used for transactional purposes in larger Russian cities (the homes of TNS’ survey respondents). The proportion of Russian consumers using bank cards to make purchases online in the country at large, then, is much lower than this figure, and when considering the purchase of physical goods it is lower still. We have also seen that Russia’s credit card market remains largely underpenetrated.

These points aside, the popularity of bank cards as an online payment method in the Russian Federation is growing slowly, and it should not be discounted that it was the payment method used by the largest proportion of TNS’ survey respondents. The use of this method will only increase as trust in online payments systems grows and cash on delivery loses its dominance in the Russian market. That being said, opinions are somewhat polarised on the specifics of using bank cards online in Russia. Whilst some sites –such as online travel services and cross-border platforms - are already recording significant activity and rapid growth in the use of bank cards, many (particularly those selling physical goods) believe today’s situation will likely continue for the foreseeable future. At any rate, bank cards will continue to integrate further with other systems in the Russian Federation (e.g. Qiwi and Visa, Yandex.Money, and MasterCard).

Overall, online retailers are strongly advised to make provision for this payment method, but also to make their security policies very clear. Russian consumers have a history of doubting the honesty of online sellers and the safety of online transactions. Thus, the more reassurance that is given, the better the customer conversion rates. To pay by bank card in Russia, a buyer simply enters information from his card into the designated fields of an online shop’s payment webpage.

Upon the submission of this information, the customer’s bank will send the user an SMS confirmation with a special code. Once this code has been entered by the user, payment is made directly from the card.

Internet banking appeared only relatively recently in the Russian Federation, though it has since established itself as quite a popular online payment method in its own right. As we saw with e-Wallets, however, the vast majority of electronic payments conducted via internet bank transfers in the Russian Federation are for mobiles, internet access, household utilities and other services; only a very small fraction of online purchases of physical goods are paid for via online bank transfers – some estimate the proportion at less than 1%.

Where offered, a consumer can choose to pay for an online service or product via his bank’s online platform. After he accepts an obligation to pay, within the stated time limits he must login to his online banking website and pay the funds outstanding under the seller’s invoice.

SMS payments

SMS payments – where products or services can be purchased directly via a text message sent from a mobile phone- are another popular method of conducting online transactions within the Russian Federation, and many large Russian mobile operators such as Beeline, Megafon, MTS and Tele2 offer their subscribers the option to make online payments via this method.

SMS payments work much like standard SMS: to make a purchase of a product or service, the buyer will sent a text message to his mobile payment provider. This provider will then clear the transaction between the buyer and seller, and the cost of the purchase will be added to a monthly phone bill or deducted from a pre-paid balance. By using SMS payments, mobile phone users can securely, quickly and safely pay merchants for the provision of goods or services, whether they be physical or virtual.

It is again important to note, however, that SMS payments are still used relatively infrequently for the purchase of physical goods; trust in electronic payments is low when compared with other areas of the world, and in no area is this wariness more pronounced than in mobile. Despite this hesitancy, though, such purchases are growing. Experts in the industry have reported certainty that these payments will become an ecommerce standard, and they will be an important factor contributing to the increase in the volume of purchases made through mobile terminals.

Cash payment terminals & mobile point of sale

Cash payment terminals are and will remain incredibly popular in the Russian Federation, especially when it comes to payment for services and virtual goods. However, again this payment method is underutilised directly for the purchase of physical goods. In 2013 alone, non-banking payment terminals handled RUB 850 billion (USD 18.6 billion) in payments. Importantly, however, the use of these payment options in Russia is declining to make way for more convenient options, and the number of installed terminals has actually fallen.

These terminals are touchscreen ATM-like self-service devices installed throughout Russia, and are easily accessible in public places. They provide users with a simple and safe way to deposit money into their e-Wallets (Yandex Money, Qiwi, etc.), pay mobile phone or utility bills and pay for purchases.

The largest non-banking payment terminal providers in Russia are QIWI, CyberPlat and ElecsNet. Interestingly, even PayPal - an international online payments company that launched in Russia in 2013 - now gives Russian customers the opportunity to pay by cash as well as card.

A mobile point of sale (mPOS) is a compact device that receives payments made by bank card at any place or time, and is a mechanism that can be used by a courier to receive cash on delivery – an important consideration for any e-Retailer into Russia. To receive a payment, the courier presents a smartphone, tablet or dedicated wireless device programmed with a special payments mechanism to the customer, who will insert a bank card into the device to facilitate payment. The programmes and mechanisms necessary to receive payments via mobile terminals can be supplied by companies such as 2can, Lifepay and Yandex Payment Solutions.

Collection points

E-Retailers into Russia should finally consider putting mechanisms in place for customers to pick up ordered goods from designated collection points within Russian borders. Customers can pay for their items online via the services mentioned above, or in whatever form they like upon collection.

Payments guidance

Unquestionably, when expanding into Russia an e-Retailer should examine and provide for the payment method most commonly used by consumers for the purchase of goods in the location. Cash on delivery will remain the predominant payment method for physical goods in Russia for the foreseeable future. However, consideration should also be afforded to up-andcoming payments methods –those that are often used for online purchases but not yet typically for purchases of physical goods. These include e-Wallets, bank cards, payments via cash terminals, online transfers and mobile and SMS payments, and each can be integrated onto an online retailer’s website separately. The growth of ecommerce will substantially spur the development of these electronic payment mechanisms, the safety, efficiency and popularity of which will in turn encourage more electronic consumer spending.

Often it can make sense to allow for several payment methods via a payments integrator, such as Yandex Payment Solution (the market leader in payments), Robokassa or Assist. Each payment integrator offers its own set of payment options and methods. As a rule, payments integrators usually offer card payments, popular electronic wallets and SMS payments.

Facilitating online payments through the services of a payments integrator in Russia can offer significant advantages. There are drastically fewer technical and documentary complications with this method, as an e-Shop only has to follow one technical protocol with an integrator. These providers offer versatile solutions with the goal of activating several payment methods simultaneously, by-passing a host of convoluted technical requirements for an e-Retailer; setting up several payment methods separately otherwise requires taking into account all of their distinctive peculiarities and characteristics. Paperwork and documentation are also reduced as a result of this solution.

Payment solution integration – whatever the form – onto a retail website does, of course, come at a cost, and appropriate research should be undertaken in this area before third-party providers are approached.

The use of electronic payments systems will continue to increase in Russia, particularly with government encouragement favouring the development of ecommerce in the country. Online payments systems are integrated by State institutions, such as the Tax Service - , public transport providers and law enforcement (enable users to pay taxes, travel cards and fines), with increased frequency, and these projects help to increase the number of Russians who are aware of online payment methods and enhancing their overall confidence in these systems. New payment methods (such as recurring, one-click and mobile acquiring) - now just emerging – will likely develop and improve exponentially as a result of increased demand and knowledge.

Ultimately, the payments market in Russia is still developing and great change in the area is inevitable. Providing popular options will allow you to meet the payment expectations of any Russian consumer. The more payment methods you allow for, the more success you will have in this location. Indeed, according to Yandex.Money, the use of popular online payment methods helps e-Shops to increase successful orders by 10-15%.






Political, social and economic environment

Online and mobile usage

Online shopping behaviour



Legal framework

Logistics and communications

Customs clearence procedures