In Russia, cash is still king—even online. That’s thanks in large part to Qiwi, a business that lets security-conscious Russians shop and pay bills electronically without having to transmit sensitive bank account or credit card numbers over the Internet. Qiwi customers deposit cash in the company’s ATM-style machines and use that money to pay their rent or phone bill—or leave it in PayPal-like online accounts for later.
Launched in 2004, Qiwi has 169,000 terminals in Russia, more than double the number of any individual bank’s ATMs. The company produced the first ubiquitous channel for e-commerce in a country with a strong distrust of the banking system. Half of Russia’s adults don’t have bank accounts. As online shopping became a part of daily life, they needed a quick and easy way to pay bills online, and many of Russia’s banks weren’t ready to meet that demand, says Qiwi Chief Executive Officer Sergey Solonin. “Not all banks have these large ATM networks,” says Solonin, surrounded by Impressionist paintings in his Moscow office. “Operators and banks couldn’t handle the increasing number of payments.”