FinTech, Big Data and Blockchain are terms that are increasingly being used in the context of entrepreneurship. Digitization trends have become an integral part of all areas of life, but there is hardly any other area in which they have had such a significant impact as in the economy. How far has Kazakhstan come and what successes has it achieved?
Anton Genza
Dialogue between the individual levels
At the PLUS Forum on October 30 and 31, 1,500 representatives from business, finance and politics gathered in Almaty to discuss aspects of digitization. With delegates from 28 countries, including Austria, Poland, France, but unfortunately not Germany, the event is one of the largest in the corporate sector and is taking place for the fourth time this year.
The forum sees itself as an interdisciplinary bridge. In particular, innovations in cashless payment systems and methods, cyber security and data protection were presented. However, the overarching theme was competition and market perspectives in the context of ever-increasing digitalization.
The forum is generally seen as a key event between individual industries and as a bridge builder. The regional context offered by the event in Kazakhstan is crucial. Similar events are planned in other Central Asian cities, such as Tashkent, Bishkek and Dushanbe, in the coming weeks.
Kazakhstan’s perspective: opportunity and challenge at the same time
Kazakhstan aims to expand and further simplify its digital options in finance. The world’s largest economy in Central Asia is considered one of the leading nations in terms of the share of cashless payments. The latest report by the National Bank of Kazakhstan attests to this, stating that the figure was 86% in September of this year. The number of users of digital financial services has increased almost fivefold in recent years. According to a joint report by FinTech Consult, MOST Ventures and RISE in April 2023, the figure was 78% in 2021 and 54% in 2017.
Governments in Central Asia recognize the potential of digital markets and are actively participating in them – as is Kazakhstan. “Everything that is happening in Kazakhstan in the area of digital financial services is unique,” says Aidos Zhumagulov, a member of the Board of Directors of Freedom Bank. The ongoing innovation of local banks and the enormous success of Kaspi.kz, the largest provider of digital financial services, are also spilling over into other countries in Central Asia. Bank apps are considered exemplary for the interlocking of official services and the financial sector. These apps not only make it possible to file a tax return, but also to access birth certificates or vaccination records.
Kazakhstan is currently implementing several approaches to regulating digital markets, according to Natalia Malyarchuk, a government relations consultant at Markets Mentor. In particular, priority is given to protecting the competitiveness of companies in the face of global digitalization trends. The Digital Markets Act, which the European Union first agreed in parliament in 2022 and is designed to prevent individual players from achieving a monopoly, is seen as a model.
Localizing data generated in Kazakhstan should favor the promotion of innovation and thus protect domestic industries. The country particularly lacks trained specialists, which is why their training is an important prerequisite.
It is no longer a question of whether artificial intelligence (AI) will change the financial industry. Rather, the focus is on the idea of competition; who can optimize their service most effectively and securely with the help of computer-based software. Artificial intelligence is largely perceived as a threat. In fact, however, a balanced regulatory approach is needed. ///nCa, 5 December 2024
About the author
Anton Genza studied East Asian Studies and Journalism in Berlin. He holds an M.A. in Japanese Studies and is currently enrolled in the German Academy of Journalism. He is a freelance journalist and translator in Almaty.