BAKU, Azerbaijan, October 13. Fintech services are planned to be expanded among Turkic states, Edgar Abdullayev, Chairman of the Board of Directors of the Azerbaijan Fintech Association (AzFina), told reporters on the sidelines of the Baku Fintech Sector Trade Board Program on Tuesday, Trend’s correspondent reports from the event.
According to him, it’s planned to strengthen cooperation with Turkic states to foster the development of the fintech ecosystem in Azerbaijan and expand payment services internationally. Key objectives within this framework include the integration of payment systems, the mutual recognition of licenses, and the implementation of fast, low-commission cross-border transfers.
He stated that significant steps have been taken since 2024 to regulate the fintech ecosystem in Azerbaijan. From that year onwards, relevant entities operating in the fintech sector were brought under the licensing and supervisory framework of the Central Bank of Azerbaijan (CBA). This has enabled the integration of a previously unregulated market into a legal framework and facilitated a more systematic organization of operations.
"The fintech ecosystem in Azerbaijan holds great potential. We are currently working on the sector's development through a constructive dialogue with the regulatory authority. This potential is not limited to the Azerbaijani market alone; there are opportunities to expand cooperation, first and foremost with Turkic states, and subsequently with the European Union and global markets," noted Abdullayev.
The Chairman of the Board of AzFina emphasized that, alongside the expansion of digital financial services, issues regarding financial security are also of particular importance. Thus, the growth of the fintech ecosystem necessitates taking into account requirements for combating money laundering and the financing of terrorism.
According to him, an approach allowing the sector to operate with complete freedom is therefore not feasible. The primary objective is to establish agile and favorable mechanisms for business development through dialogue with the regulatory body, while simultaneously upholding financial security requirements.
Abdullayev also touched upon efforts to expand cooperation in the field of financial technology among Turkic states. He noted that the groundwork for creating a platform for cooperation among the central banks of Turkic states was laid in 2024. As a continuation of this process, the Azerbaijan Fintech Association and the Payment and Electronic Money Institutions Association of Türkiye (TÖDEB) are working, within the framework of the "Turkfin" initiative and with the participation of other Turkic states, to establish a cooperation platform.
"The primary objective of the 'Turkfin' initiative is to establish a unified cooperation platform among Turkic states, expand payment capabilities, and achieve the harmonization of regulatory frameworks. This includes exploring the digital identification of products created under special regulatory regimes, as well as the mutual recognition of licenses issued for the provision of payment services.
In the initial phase, establishing a mechanism for the mutual recognition of licenses among Turkic states could facilitate fintech companies' access to regional markets. This could pave the way for companies to expand their operational reach, deliver services to a broader user base, and strengthen regional integration in the financial technology sector," he explained.
According to Abdullayev, the long-term goal is to enable a customer of an electronic money institution licensed by the CBA to utilize payment services in Türkiye or Uzbekistan using the same account.
He noted that one of the most significant prospects in this regard is the integration of the instant payment systems of the Turkic states. Such a mechanism could enable faster money transfers between countries and reduce operational costs and commissions.
"From the perspective of a shared financial ecosystem, one of the greatest achievements would be the integration of instant payment systems and the execution of transactions between Turkic states through this common ecosystem. This would make it possible to both increase transfer speeds and lower commissions," he emphasized.
The head of AzFina added that the economic sovereignty and financial security of the countries must also be taken into account when implementing such integration projects. Therefore, the coordination of payment systems, the organization of cross-border transactions, and the development of relevant regulatory mechanisms should be conducted based on a risk-based approach.
According to him, creating the right balance between financial security and the development of innovation is one of the key prerequisites for expanding fintech cooperation among Turkic states and forming a shared digital financial ecosystem.