Turkan Farzaliyeva: The Rise of Fintech in Azerbaijan - An Entrepreneur's Journey

An accomplished entrepreneur, who currently holds the position of CEO and Co-Founder at PayRiff, a fintech enterprise headquartered in Azerbaijan, Turkan Farzaliyeva, decided to switch her careerpath to the world of startups only three years ago.  

With a solid background in Marketing and a decade of experience in a variety of holdings and corporations operating in the Azerbaijani and Turkish markets, the young entrepreneur felt compelled to explore the startup space. She felt it was her true calling.  

“I was inspired by how startup principles were aligned with my personal values. For instance, if there’s a problem that presents itself, I’m driven to provide a solution immediately,” she states, speaking about her foray into fintech with PayRiff, where the company's primary focus is on constructing economic frameworks across the online space, making it accessible to emerging startups and established corporations alike.

“Even though I’m not a big fan of finance, nevertheless, with added technology it becomes much more interesting and fun. Traditional banking solutions simply don’t meet the expectations of the new generation – the procedures are long and tiring. Personally, the key functionality that I was driven to create at PayRiff was the full and partial refund problem that we provide with just one click from the user dashboard.”

Encouraging Digital Payment Methods in Azerbaijan

Speaking about the changes that have taken place in Azerbaijan’s fintech industry over the past few years, Turkan reveals that there has been a steady build-up of customers who are opting for digital payment options.

In order to encourage citizens to shift towards digital payment methods, loyalty programs have been launched by both the public and private sectors. Policies such as the Tax Refund, higher cashback rates, discounts, and digital onboarding procedures offered by card-issuing banks have been effective in influencing customer behavior. This, the entrepreneur revealed, has had a massive impact on customer behavior.

“According to statistics by the Central bank of Azerbaijan, digital payments grow its market share around twice more each year. In the last two years alone, NFC payments started to take an essential share in POS payments with Apple Pay and Google Pay entering the market. Moreover, providing installment options in cashless payments, easier, faster onboarding processes and softened banking regulations increased the penetration rate of credit cards as well,” she states.

“Strict regulations and higher interest rates on cash-outs from these credit cards pursued customers to pay online. As a result, we have observed an overgrowth of the fintech industry.”

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Given the industry has begun to flourish, Turkan believes that regulations have limited the penetration rate of global players in the region. Consequently, this has prompted local fintech startups to introduce innovative solutions from around the world to the region.

In addition, recent political negotiations have resulted in improved economic relations in the region, making it necessary to establish better regional synergies and fintech solutions to meet economic KPIs. Government restrictions on cash payments in certain industries have created new opportunities for traditional businesses.  

Hence, Turkan states, PayRiff, has been able to sign several successful contracts and become a key payment partner for larger retail and fintech companies in Azerbaijan.  ‍

Balancing Innovation and Regulatory Compliance: PayRiff's Approach

Regarding the trials PayRiff has encountered in scaling its services, Turkan mentions that local retail businesses are struggling to achieve significant sales volume, with many online shoppers preferring to purchase items from global marketplaces. As a result, the demand for local fintech players in the retail market is not aligned with the supply, and only a limited number of industries generate noteworthy transaction volumes. As a result, she explains, the highly competitive nature of the industry has negatively affected pricing strategies, and many partnerships between fintech players and key retailers are not sustainable.  

“The situation is getting worse day by day. That’s one of the key reasons why PayRiff expanded globally in its first year of production and is still exploring virgin markets to penetrate.”

How then does her company stay ahead of the curve regarding innovation and the need to maintain regulatory compliance and security?

“To sustain balance between innovation and regulation is extremely difficult, yet possible. Since the very beginning we have invested a lot in research and consultancy on regulations and luckily, have been able to successfully build important relations with governmental agencies and ministries. It may be hard to design initial ideas in accordance with regulatory compliance, nevertheless, while designing the architecture, it’s possible to generate alternative solutions to business problems.”

Overcoming Misogyny as a Female Founder in Fintech

Speaking about her experience working as a female founder in the industry, Turkan reveals that it hasn’t always been a smooth ride.  

“Considering the difficulties women face in countries as conservative as ours…after a while the challenges become normal,” she says, before proceeding, “The biggest challenge is to be a woman; you’re constantly compelled to prove yourself at every stage. Even sharing space on a panel discussion as a female, one experiences sexism quite publicly. It’s unfortunate.”  

Despite these challenges, Turkan refuses to cower down in light of the age-old elephant in the room: misogyny.  Nevertheless, for the road ahead, the entrepreneur has one, single goal: to build PayRiff into Azerbaijan’s first-ever, unicorn fintech startup.  

“The Azerbaijani Stripe,” she states with excitement.

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