We are enclosing an interview with Elena Gafarova, the VP of Global Sales and Product Management at CONTACT.
CONTACT is a leading International Money Transfers and Payments system founded in Moscow in 1999 by RUSSLAVBANK and has a network of 230 000 service points, including payment terminals in over 100 countries. CONTACT will be a GOLD Sponsor at our upcoming IMTC USA 2013 Conference on April 3-5, 2013 at the Hyatt Regency in Orange County.
To learn more about CONTACT, and Russian money transfer patterns, view our recent release.
Interview with Elena Gafarova, Contact, VP of Global Sales and Product Management
1) Elena, Tell us about the history of the Russlavbank with regards to Money Transfers.
The history of CONTACT system’s appearance on the Russian financial market is unique and was an example of the successful implementation of business projects in the money transfers segment.
After the financial crisis of 1998, Russian banks started to search for new products and services, which could compensate them for the loss of revenue in the stock markets. In 1999 RUSSLAVBANK put forward the idea of creating its own system of money transfers.
Bank research showed that money transfer services were in great demand in Russia and could add a sustainable fee income. But the new system had be international, not focused on specific corridors or diasporas.
Within two months, our software and normative documents were prepared. The name is an abbreviation of three words: CON – from the Latin “con (cum)” – «together, at the same time»; T – “transaction” – «transaction”, which are the key transfers and payments; ACT – from the Latin “actus” – a self-fulfilling effect. The word become a part of everyday life and associated with remittances through heavy advertising rotation in consonance with the slogan “Contact now!”.
At that time, the concept of money transfer systems did not exist in Russia. These services were only provided by two international companies. Because of these companies’ high fees, only a limited number of people could use their services and only for transfers to foreign countries. Sending money within Russia could only be made through networks of state banks.
2. In your opinion, what makes Contact services unique?
From its first days, CONTACT gained a foothold in the market. Its main advantage was that the project was originally designed as an international money transfer system, and the development of the partner network had been a top priority. Currently, among the partners of the system are the largest financial institutions in Russia, CIS and other countries. Such an approach allowed the system to maintain leadership in key corridors in Russia and the CIS, and in some areas abroad. It’s no secret, for example, that about 40% of remittances from Italy to Russia and from Spain to Russia are transferred through CONTACT.
In addition to remittances, CONTACT began to develop payments services for various providers in 2004. Now, CONTACT also develops different remittance formats – cash-to-account, cash-to-cash, and account-to-cash. It should also be noted that CONTACT is the only Russian money transfer system whose quality management system is certified according to ISO 9001:2008.
3. How important is the North American Market for your institution and what are your goals in the area?
The North American money transfer market is among the top three international priorities of the CONTACT system. For many years, the U.S. and Canada keep positive migration flow dynamics from Russia and the CIS countries. The total number of Russian-speaking immigrants in the United States is more than 3.5 million people, and in Canada – the number of granted temporary permissions to work in the last 3 years, is more than 10 thousand people.
In other words, for the CONTACT system the North American market provides a stable target audience that can generate the demand for money transfer services for years to come. In addition, as a consequence of migration, remittances are also at a high level. According to Statistics from the Bank of Russia, in 2012 the volume of remittances from the United States to the Russian Federation ranged from $39 to 48 million each quarter, and in the opposite direction (from Russia to the United States) ranged from $24 to $ 27 million. The turnover of money transfers between Canada and Russia reached $20 million in the first half of 2012.
Along with Russia, significant amounts of remittances from the United States are sent to Ukraine, Uzbekistan, Georgia, Belarus, and from Canada to Ukraine, Moldova, Belarus, and Kazakhstan. Growth rates, depending on the corridor, range between 6% to 25% per year. The main objectives of the presence of CONTACT in the North American market is its ability to offer customers and partners a direct, high-quality, more convenient and efficient channel of money transfers both in Russia, the CIS, and other countries.
4. What trends do you forsee within the next 3 years in the CIS region in respect to migration & remittances?
Since 2009 we have seen a steady increase in migration flows from CIS countries to Russia and a number of EU countries. As a result, the demand for money transfer services also increases. In this case, we clearly see a shift in the preferences of our customers toward transfers committed via Internet, terminals and electronic wallets. That, of course, will help reduce transfer speeds and commission fees.
5 Why was the IMTC chosen as the way to make your services known in the Americas?
In my opinion, IMTC is the best platform for communication with the money transfer business community, offering an optimal set of positioning formats for new market entrants as well as experienced companies. In addition, the IMTC conferences gather not only American remittance companies, but also from Europe and Latin America, which is certainly an important advantage. Overall, the experience of participating in IMTC conferences fully meets our goals to establish and develop partnerships and position our capabilities to the widest audience.
6. What is your background? What made you choose this career? How long have you been in the company and what is your main function? Any people in your team that must be mentioned today?
I came to the CONTACT system in November 2005, having over 13 years of experience in commercial banks. At that time I specialized in international wire payments and correspondent relations. Communication with foreign partners on contracts, settlements and payments were my direct responsibilities. Such background helped me quickly settle into my new position at Russlavbank. Money transfers from Russia and CIS to Vietnam, Poland, and the United States were among the first corridors that I personally launched at CONTACT. This gave me experience in a new type of transactions – money transfers. System adjustment to AML requirements of other jurisdictions, automatization of messaging and settlements with foreign companies, workflow optimization – all these were literally designed from scratch. And of course, thanks to the people who believed in me, the people who helped and supported me, the people who shared with me their ideas and experience in the launch of other corridors and products.
My current responsibilities include CONTACT network development and product sales in the overseas countries. CONTACT system now is a network in more than 110 countries around the world with 250,000 POS, inc. ATMs, and a 12 million transaction turnover p.a.
Under 2012 statistics, 10% of CONTACT cross-border transactions are sent to overseas countries and received therefrom. It is also very encouraging that this destination shows the highest transaction growth rates in CONTACT system – up to 40% on some corridors.
7. To finish the interview, Elena, tell us, do you have any special hobbies, activities you do, sports you practice in your spare time that you want to share with us?
For me, two things are important in life – inner harmony and the ability to allocate your time. It is very important not to succumb to stress, to give up under suspense that surrounds us every day, to preserve the purity of consciousness, to maintain your internal energy. Without this it is impossible not only to self develop but even to work. Jogging, yoga, and kitesurfing help me to disconnect from the outside world. Moving is like mediation for me when new ideas, new thoughts come and the mind opens to the world. You come to the office charged with positive energy. You carry yourself in this positivity, and the day passes just to cheer.
