Hungary’s Online Payments Market Booming

  • 5 Jun 2018 11:05 AM
Hungary’s Online Payments Market Booming
The domestic market of online payments has boasted dynamic growth in recent years as the volume of such transactions rocketed tenfold. According to the National Bank of Hungary, bank cards issued within the country were used to pay out HUF 375 billion through the internet already in 2016.

While this turnover is not far behind the leading countries in the world, there is still room for development. But this requires increased consciousness. Contrary to popular belief, paying with a bank card is safer than cash, concludes a fresh “eTrends Monitor" study.

Online payment gains significance

Online payment solutions have been embraced by more and more sectors in recent years. You no longer have to queue up in a post office to pay your utility bills or stop at a fuel station to buy a motorway sticker; you can take care of all that online, conveniently, in just a few seconds.

The reason is that major service providers and retailers have recognised the importance of digital payment. Thanks to continuous innovation and progress, more and more services allow for online payment, for example in areas like telecommunications, public utilities, trade, shopping, and insurance.
 

Online payment is fast, convenient and, first of all, secure

Payment transactions are still dominated by cash in Hungary, even though much more secure payment methods are now available, especially compared to shopping online and paying cash upon delivery.

It’s rather cumbersome to retroactively undo such a transaction if the unpacked product turns out to be defective or different from the one ordered. In contrast, if you pay online with a bank card, then you can claim the price back through your bank.

Also, there is the so-called chargeback procedure if the goods ordered on the internet don’t arrive. And online payment has advantages other than security: card data can be saved, a transaction can be launched with a single click, and payments can be automated.

This makes the process very fast and convenient. Online traders and service providers can provide a better customer experience via digital payment; this is beneficial to them, too, and not only to customers.

A secure payment solution increases customers’ confidence and (last but not least) speeds up the flow of funds, thus increasing financial cash flow. Finally, at a higher (social and economic) level, all this curbs black economy. 
 

Main market players

Research by eNET indicates that the largest players in the market of online payments are the following (in alphabetical order): Barion, Borgun, CIB Bank, Erste Bank, Global Payment, K&H Bank, OTP Bank, OTP Mobile and Simple, PayPal, Six Payment, Wirecard.
 

Ample potential

This is a field that requires constant development, as indicated by the regulatory environment: the European payment services directive (PSD2) that takes effect this year and the instant payment system to be introduced in mid-2019 will bring several opportunities and obligations.

First of all, competition amongst payment service providers will intensify in Hungary, too. And the online payments market is set to expand further. The online payments turnover reached HUF 363 billion in the first three quarters of 2017 (up from HUF 264 billion in the same period of the previous year, and almost as much as the HUF 375 billion registered in the entire year 2016).

In a few years, Hungary’s online payments market could reach the HUF 1,000 billion landmark.

More: eNET Internet Research

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