240,000 Armenian pensioners will receive cashback with bank cards

Cashback for Armenian pensioners

The Armenian government has decided to increase the cashback percentage for pensioners and benefit recipients on cashless purchases. They will now receive 12% cashback on their bank card purchases, up from the previous 10%. The maximum cashback amount is set at 6,000 drams [around $15.6]. This decision will take effect in September 2024, meaning the new calculations will be applied starting in October.

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The cashback programme in Armenia has been in effect since July 1, 2022. The government anticipates that it will:

• Alleviate the negative effects of inflation
• Increase the volume of cashless transactions
• Improve consumer awareness of modern financial tools and technologies and expand their use

Currently, pensioners and benefit recipients receive 10% cashback on their cashless purchases, up to a maximum of 5,000 drams [around $12.9]. Initially, banks covered 5% of this amount.

However, starting January 2024, the programme will be fully funded by the state budget.

Armenian pensioners to receive cashback for using cards

In Armenia, pensioners and socially disadvantaged families receiving benefits will receive a monthly cashback for non-cash transactions. Thus, the government aims to promote the use of non-cash payements

Cashback for utility payments to end

Armenian minister of Labour and Social Affairs, Narek Mkrtchʻyan, has announced that cashback will no longer be offered for utility payments. The decision was made because utility payments are fully within the formal economy, and one goal of the program is to reduce shadow economic activities.

“Given that there has been a behavioural change, with pensioners and benefit recipients actively using cashless payments, we proposed this adjustment,” said the minister.

Over $23 million returned since program’s launch

As of July, approximately 240,000 beneficiaries have received about 9 billion drams [around $23.3 million] through the cashback program.

Since the program’s inception, pensioners and benefit recipients have made cashless transactions amounting to 119 billion drams [about $309 million].

The minister highlighted that many pensioners opted to receive their pensions on a card to benefit from the cashback program. Initially, around 300,000 people received their pensions on a card, and now this number has increased to approximately 540,000.

“Essentially, 44% of them are now utilizing the cashback program for cashless payments,” he said.

An increase in pensions and benefits in Armenia will affect about 580,000 people

Given the high level of inflation, economists do not expect an improvement in the quality and standard of living