III international conference on

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III international conference on Markets for
money transfers, bank metals and cash
currency International Money Transfers and
Payments system CONTACT innovations and
development Kiev, Ukraine 20 May 2011
Igor A. Efremov Vice President, JS CB RUSSLAVBANK
(CJSC) (Russia)
www.russlavbank.com www.contact-sys.com
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JS CB RUSSLAVBANK (CJSC) is the organiser and the
Clearing Center of the CONTACT system

• general banking licence No 1073 dated 05.12.1990.
• being a universal bank, it has all licences
  issued by the Bank of Russia.
• over 2,100 operating correspondent LORO accounts.
• was twice awarded by Deutsche Bank for the
  quality of settlements USD STP Excellence
  (2005-2009) and EUR STP Excellence (2009).
• one of the largest participants of SWIFT in
  Russia, member of the RosSWIFT Committee.
• participant of SWIFT Workers Remittances Users
  Group (WRUG).
• the only Russian bank that is certified to prove
  compliance with requirements of SWIFT Workers
  Remittances live services.
• in 1999 established the CONTACT international
  Money Transfers and Payments system that is based
  on the correspondent banks network.
• As at today CONTACT is the oldest and largest in
  Russia network of bank outlets which provide the
  money transfer service.
• The quality management system of the CONTACT
  Clearing Center fully conforms to the
  international standard ISO 90012008.

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Global money transfer market
Trends in the major financial flows in the world
in billions of USD
Foreign direct investments (FDI)
Indebtedness of natural persons and investment
portfolio
Volume of money transfers in the world
Official Development Assistance (ODA)
Source World Development Indicators (September
2010), Global Economic Monitor, Migration and
Remittances Factbook 2010
Money transfers show the most stable dynamics
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Weight of money transfers for economy of
developing countries
Top-10 countries of the world by the volume share
of received transfers in GDP
of GDP, 2009
???????? Migration and Remittances Factbook 2010
Money transfers make a notable contribution to
the economy of developing countries
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Money transfer market Servicing institutions
Retail money transfers area
Banks
Local remittance companies
Network banks
International remittance companies
International banks
Mails
Mail alliances
1999 is the first year of CONTACT operation. To
date, there are 17 money transfer systems in
Russia.
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Money transfer systems keys to success

Financial success, popularity of the brand
Geography of presence
Innovative technologies
Customer value of product
Strategic partners
System organising team (business, IT, marketing,
attraction, support, settlements)
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Keys to success Customer value of the Money
transfers product
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Keys to success Customer value of the CONTACT
Money transfers product
Product line extension
Over 1200 CONTACT payment products
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Keys to success Customer value of the CONTACT
Money transfers product
Product line extension CONTACT-ACCOUNT Money
transfers to be credited to accounts of
individuals in any bank of Russia, the USA and
Europe
Unified technology platform CONTACT
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Keys to success Customer value of the CONTACT
Money transfers product
Product line extension
Ecosystem CONTACT
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Keys to success Geography of presence

• The main tasks the organisers of money transfer
  systems have to tackle
• Expansion of geography of presence,
• Increase in the market share in the key
  corridors,
• Condensing the network in the major sendign and
  receiving countries,
• Step-by-step availability of the service.

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Keys to success Geography of CONTACT presence
Number of participating banks
Number of bank offices
Russian banks International banks and companies
Bank offices in Russia Bank offices abroad
CONTACT today
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Keys to success Geography of CONTACT presence
The largest connections in Q1 2011
Q1 2011 the network expanded by 36,000 service
offices
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Keys to success Geography of CONTACT presence
Market share in some strategic cross-border
transfers corridors (Q4 2010)
to Russia
from Russia
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from Europe from the NA
to Europe to the NA
???????? ???????????, ???? ??????, 2011
Source RUSSLAVBANK, Bank of Russia, 2011
NA the near abroad (the CIS countries, the
Baltics and Gergia)
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Keys to success innovative technologies
Innovations in the world from practice to
standards
The standartisation is a safe and proven method
of enhancing the quality of innovative solutions
and reducing their integration costs
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Keys to success innovative technologies
For individual customers availability of
service, variety of ways to send transfers
For servicing institutions standartisation and
unification of interbank exchange formats
Step-by-step availability ATM, self-service
terminals
New formats of interbank exchange of transfers
SWIFT Workers Remittances
Service availability 24 x 7 x 365
Internet-banking, Mobile Banking, Mobile
payments/transfers
Unified XML message formats transmitted through
WEB-service

• Single technological platform CONTACT NG
  Technology XML-platform that includes
• Web-service
• Front-office software for CONTACT NG banks
• API for integration of all CONTACT services
  into any ABS, ATM and serf-service terminal
  software, Internet and mobile banking.

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Keys to success innovative technologies CONTACT
Platform CONTACT NG is the technological base
for the CONTACT ecosystem
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Keys to success innovative technologies
Ways of sending payments (all-Russia NAFI survey,
April 2011)
Internet bank
by e-money
From a mobile phone
by card via the Internet
at a store cash-desk
through mobile communication salons
via mail
POS-terminals
bank outlets
???????? ????, ?????? 2011
Remote banking, e-money and bank agents provide
the potential for growth
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Keys to success strategic partners
Strategic partners
Benefits for MTSs
Distributors high street banks and large
remittance companies
Considerable increase in points-of-customer
service
Increase in the payment products number,
clientele growth
Providers banks and legal entities
Vendors Banking software developers
Reduction of costs for system services
integration when connecting new participants and
supporting the existing ones
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Keys to success and popularity of the CONTACT
brand
Growth of cross-border transfers volume in the
Russian Federation in Q1 2003
????
CONTACT
All systems
???????? ???????????, ???? ??????, 2010
Source RUSSLAVBANK, Bank of Russia, 2010
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The bottom line

1. The constant product line extension allows the
   System to attract new customer categories to
   offices of partner banks.
2. The expansion of geography of presence, increase
   in the market share in the key corridors,
   condensing the network in the major sending and
   receiving countries ensures the steady growth of
   the volume of CONTACT funds transfers.
3. Implementation of innovative technologies and
   integration solutions makes the System service
   much easier accessible to end-users, provides its
   availability 24 x 7 x 365 and allows to cut costs
   of executing operations for partner banks.
4. Successful and mutually beneficial cooperation
   with strategic partners banks, service
   providers, software developing companies,
   remittance companies gives good grounds for the
   dynamic growth and rapid technological
   re-equipment of the System.

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Russia? Ukraine transfers positive dynamics
Annual volume of money transfers from Russia to
Ukraine
in millions of USD
???????? ???????????, ???? ??????, 2011
Source RUSSLAVBANK, Bank of Russia, 2011
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Q u e s t i o n s ?
Igor A. Efremov Vice President, JS CB RUSSLAVBANK
(CJSC) (Russia)
www.russlavbank.com www.contact-sys.com