Azerbaijan’s Payment Rails & How They Work – AZIPS, HÖP & Mobile Wallets

The rapid rise of cashless payment methods, the upgrading of payment rails, and the growing digitalisation of payments all point to a major transformation in Azerbaijan's payment system. The country's payment system is shifting away from cash-based transactions and towards more modern computerised solutions. The HÖP payment system, the Azerbaijan Interbank Payment System (AZIPS), and the Azerbaijani mobile wallet ecosystem, which is growing quickly, are all essential pieces of this transition. They work together to develop a strong and flexible digital payment system in Azerbaijan.

AZIPS: The Building Blocks of High-Value Payments in Azerbaijan

The Real-Time Gross Settlement (RTGS) system in Azerbaijan is called the Azerbaijan Interbank Payment System (AZIPS). The Central Bank of Azerbaijan (CBA) runs AZIPS, which is a system for transferring large amounts of money between banks. It provides fast settlement with high levels of safety and efficiency.

One of the most fundamental changes in the growth of Azerbaijan's payment system has been the upgrading of AZIPS. The system is now in compliance with international standards because it switched to the ISO 20022 standard. This has made it easier to uncover fraud and collaborate with payment networks from other countries.

The system is particularly crucial for keeping the economy stable on a large scale:

AZIPS processed 908,000 transactions totalling AZN 195.6 billion in 2020.
There were 31,000 transactions a month by February 2024, which was a 34.8% increase.
In February, the average transaction size was AZN 252.8.

AZIPS is used by Pasha Bank and other big banks to move money in multiple currencies to and from other countries. To sum up, AZIPS is the principal way for high-value financial transactions to happen. This guarantees that payments will be handled swiftly, in a matter of seconds, for those who wish to know how Azerbaijan's payment system works.

The HÖP Payment System for Small Transactions

The HÖP payment system, or the Low-Value Payments Clearing and Settlement System (LVPCSS), interacts with AZIPS. HÖP takes care of low-value, non-instant retail payments, whereas AZIPS takes care of high-value payments in real time. This makes the national payment system fair and adaptable.

The system needs to be able to process payments from both businesses and customers regularly. Azerbaijan also started the Instant Payments System (IPS), which is now a big part of the country's system for making payments right away. IPS lets you send money any time of day or night, and it just takes 5 to 20 seconds. You can only send AZN 40,000 at a time. This innovation has made it even less necessary to utilise cash because it is now easier for people and small and medium-sized organisations to transmit money online.

The AZIPS, HÖP, and IPS payment systems work together to make sure that all of your financial demands, big and little, are addressed quickly and reliably.

Also read: Serbia’s Payment Rails & How They Work – DinaCard, IPS & Real-Time Payments

The Quick Rise of Mobile Wallets in Azerbaijan

The emergence of mobile wallets in Azerbaijan over the past few years is undoubtedly the most noticeable trend. Changes started happening long before the pandemic, but the pandemic sped things up. Azerbaijan built a cutting-edge IT infrastructure and passed laws to enable it, such as the Law on Payment Services and Payment Systems.

There are now 12 mobile wallet companies that are allowed to do business in the country. This creates a wide range of environments that function well with cellphones and NFC technologies. GoldenPay JSC, PashaPay, United Payment, Modenis, Mpay, Paysis, and PulPal are some of the companies that have licenses. The business is growing swiftly, and United Payment is getting set to launch its TURAN e-wallet. This software will be the biggest money app in the Turkic republics and will let consumers transmit money across borders in the area.

Foreign investors have also made Azerbaijan a stronger player in the global fintech sector. Two years ago, services like Google Pay and Apple Pay started working in the country. Users may now keep their boarding passes, credit cards, and loyalty programs right on their devices. This made things a lot easier for customers by removing obstacles between regional banks and worldwide payment systems.

Using Digital Payments in Daily Life

People in the transportation, retail, and service industries use Azerbaijani digital payments every day.

People in Baku and Sumgait use the BakiKart system to go around on public transport. You can use it with plastic cards and cell phones. In the first half of 2024, 1.88 million people used QR codes to buy their metro tickets. Usage went climbed by 69% in July. Digital ticketing has increased even further with the emergence of smartphones, wearables, and even smart wristbands that can use NFC.

There are also huge changes going on in rail travel. Visa has built up a mechanism for paying for suburban trains without having to touch anything at 14 stops around the Absheron ring railway.

As part of Azerbaijan's smart city projects, buses, taxis, parking garages, and shared mobility services like bike and scooter rentals in other cities are getting digital payment systems. These improvements illustrate that fintech in Azerbaijan is spreading beyond banking and into other services that people use every day.

The Regulatory Landscape and Issues

Regulators are needed for the digital payment ecosystem to work. The Law on Payment Services and Payment Systems is the main law that makes up the legal framework. The Central Bank of Azerbaijan is a big part of making it happen.

New cybersecurity guidelines went into effect in April 2025 to deal with the rising threat of cybercrime. Changes are being made now to make sure they follow best practices from all over the world. These changes are particularly significant since Azerbaijan's e-payment systems are growing and attracting more users, which makes them easier targets for hackers and fraudsters.

Digital payments make payments safer and easier for everyone to use. Digital channels make it easier for people who don't have access to basic financial services like credit, savings, and payments to join the formal economy. The Swiss SECO is aiding the IFC's Electronic and Digital Financial Services project, which wants to make it easier for people and small businesses to use these services.

Also read: Belarus’ Payment Rails & How They Work – BELKART, ERIP & Digital Wallet Systems

The Banking System in Azerbaijan and Future Outlook

There has been a large surge in card-based transactions in the Azerbaijani financial system, which illustrates how swiftly the country is embracing digital channels. By 2024, bank-issued card transactions had grown by 27% from 2023 to AZN 126 billion ($74.1 billion). By April 2025, 91% of transactions in the US and 67% of transaction volumes were done without currency. This means that 90% of all transactions in Azerbaijan are now done with a credit or debit card.

Cross-border wallet integration, the growth of smart city infrastructure, and the ongoing development of mobile and immediate payment systems are all vital for the future of fintech and payments in Azerbaijan. The location is becoming the centre of digital finance in the country.

Azerbaijan's payment system is developing swiftly, which means that banks and enterprises can become digital-first financial services. Still, it's a significant problem that transactions can happen across borders.

This is where global fintech partners can help. TransFi and other technologies link regional banks to global networks, which lets people make digital payments across borders. It's really vital for Azerbaijan to have the proper partners to help it expand securely and successfully as it becomes a fintech hub. To find out more about solutions created particularly for Azerbaijan and Central Asia, contact sales or an expert.

Conclusion

A lot has changed in the way individuals pay in Azerbaijan in the last ten years. AZIPS Azerbaijan helps the country make massive payments, and the HÖP payment system helps it make minor payments. Both systems let you make payments right away. Cashless transactions are already common in Azerbaijan thanks to the rise of mobile wallets and their connection to global platforms. This has made people use these technologies even faster.

There are still challenges, including cybersecurity, but the future looks very promising. Azerbaijan is going to be the region's leader in digital payments and financial technology due to strong government support, extensive use, and novel fintech innovations.

TransFi and other solutions give organisations the information and resources they need to make international payments function seamlessly so they can take advantage of these prospects.

FAQs:

1. What role does AZIPS play in Azerbaijan's payment system?

AZIPS is Azerbaijan's RTGS system, which enables banks to settle large-value payments in real-time. It keeps enormous quantities of money safe and moves them rapidly.

2. What is the point of the HÖP payment system?

HÖP handles payments that aren't instant and aren't worth much. It enhances AZIPS by ensuring that retail payments are processed efficiently and handling small transactions.

3. How many people in Azerbaijan use mobile wallets?

There are presently twelve licensed providers in Azerbaijan. Apple Pay and Google Pay are two of the most popular services. Other popular services are PashaPay, GoldenPay, and TURAN e-wallet (coming soon).

4. How many transactions in Azerbaijan are now done without cash?

As of early 2025, 91% of all payments in Azerbaijan were made electronically. This illustrates that the country's efforts to become digital are paying off.

5. What will the future of fintech in Azerbaijan be like?

There will be increasing use of rapid payments, cross-border wallets, contactless transit networks, and tougher security laws in the future.

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