THE ROLE OF DIGITAL PAYMENTS AND STUDYING THE CURRENT SITUATION IN STRENGTHENING THE FINANCIAL RESOURCES BANK OF BANKS IN AZERBAIJAN

cards are created, which differ in their purpose and technical characteristics. Transactions with bank plastic cards open up new perspectives for financial services to clients of local banks. Aim and tasks. In connection with the expansion of digital payments in Azerbaijan, it is to investigate the features of financial management in banks and to study the current and prospective effects of digital payments in the formation of financial resources of banks. Research results. During the study, the types, characteristics, and effects of the digital payment system on economic processes were studied. Material and methods. Statistical calculations, sample observation, synthesis, regression analysis were used in the study. Regression analysis consists of steps such as selecting the model type, calculating the parameters, constructing the model, and assessing its suitability and accuracy. The level of accuracy of the model characterizes the degree of deviation of the actual values of the dependent variable from the values obtained on regression models. Estimates such as average relative error, average absolute error, standard error are used to estimate the level of accuracy. Conclusion . It is important to improve and develop the infrastructure of banks in order to present the applications of banks in the field of digital banking to the wider public.


Introductıon
Electronic payments are widespread with the development of e-commerce and Internet banking. Plastic cards have traditionally been the main means of payment in e-commerce. The latest payment instruments, in addition to ensuring customer satisfaction, have strengthened security measures against possible intrusions by online fraudsters. The urgency of the research topic is to objectively determine the level of development of information technology in the conduct of payment procedures in the banking sector in the current situation and the emergence of new methods and mechanisms. Currently, with the development of electronic payment systems, there is a high activity of credit institutions to reduce paper technology. This process is typical: an increase in the issuance of plastic cards, an increase in turnover and balance in card accounts, The expansion of services using bank cards is typical for this process. During the development of the plastic market, various types of plastic cards are being created, which differ in their purpose and technical characteristics. Transactions with bank plastic cards open new prospects for financial services to customers of local banks. Various payment systems are being developed and accelerated in the country, and more and more citizens are participating in the cashless payment system based on the use of bank cards.
Problem statement and its connection with important scientific and practical tasks. Setting the problem and its relationship with important scientific and practical tasks importance from determining the existence of conditions for the active development of digitization in the country and as a result of its application in the future, both micro and macro of the country actions that will increase the impact of digitalization on economic growth at the level consists of the development of the complex. Results obtained during the study, proposed methods and practical recommendations on the speed of information technology in Azerbaijan state aimed at improving the quality of economic growth aimed at improving the development of the policy. Research separately the results of competitiveness by companies and banks in new conditions can be used to develop a growth strategy.
Theoretical part of the research Ensuring system integration in the digital economy is one of the main goals of the digital transformation process. System integration can be expressed as structural changes in the organization and management of physical objects and their interaction with information systems. System integration, consisting of horizontal and vertical integrations, analyzes the flow of the production system as a whole. Vertical integration is the support of the transformation of the underlying system by factors arising from the internal structure of the firm. The development and implementation of the company's activities, which include key elements such as the organizational structure of the company, the human factor, departmental relations, technology and management level, means vertical integration. Horizontal integration supplier and customer network integration, Thanks to the recent revolutionary development in digital technology, big data has become a fundamental concept that is gaining importance in terms of economies. In the digital economy, big data has become the oil of the traditional era. One of the most important concepts in the digital age, big data is considered to be a collection of data that is too large to be processed by existing systems and difficult to maintain and analyze. Big data is high-volume data expressed in units such as petabytes, exabytes, and zettabytes. For example, one petabyte is equal to the text of about 20 million file folders, and an exabyte is equal to 1000 times that amount (McAfee, Brynjolfsson 2012, p.64 Digital banking, also known as branchless banking, is considered to be a type of banking that is able to provide all types of banking services to customers without the need for branches and employees. Eliminating branch and staff costs, reducing operating costs and being easy to use are among the main advantages of digital banking (Zhao 2009, p.2). Digital banking means providing banking services to customers through a computer or television. Users can easily perform all banking operations at home, in the office or anywhere with internet access.
One of the alternative distribution channels developed to diversify financial services as a result of increasing competition is the electronic or online banking system (Daniel and Storey 2009: p.72). Electronic banking is used as a generic name for individual and small value banking operations carried out using electronic devices (Kurnia , 2010, p.1).
Digital banking is the provision of financial services by a bank to customers using a website without any time or space constraints. Thus, customers can use the website to carry out traditional banking operations using their bank account information, as well as the bank's mobile applications. Mobile banking means being able to conduct traditional banking operations without going to bank branches (Tapscott, 2008).
In a study by Pickens et al. (2009) of creating branchless banking scenarios, the following decisions were made regarding the real state of branchless banking services (Demiral 2017, p. 25-35): • The financial system is growing and developing in many countries. However, this growth is provided by more branches and automatic ATMs.
• Growing using bricks and mortar (creating a physical branch) naturally requires a certain cost. This cost does not exist in branchless banking. It is a fact that in most countries, customers prefer to go to branches. However, the pandemic proved that banks are working to provide customers with many services at home. Some banks have provided online card issuance and delivery services to customers. Rabitabank was the first to provide this service in Azerbaijan.
• The success of non-branch banking services depends on raising awareness of the material needs of the middle and low-income population. Because those who take loans from banks for personal use and starting a business are mainly middle and lowincome groups.
The first digital banking application was introduced in 1981 in the US state of New York as "home banking" services (Osho, 2008). Home banking is the provision of a line connected to the banking system that allows bank customers to operate directly with their bank accounts. This line can be connected to TVs and computers used in homes and workplaces. Thanks to these lines, it is possible for customers to obtain information about their bank accounts and issue payment orders to the bank for money transfers between accounts. In home banking applications, customers connect to the bank's main computers using their personal computers and a modem device via telephone lines. At the same time, customers benefit from all the services offered by the bank. In this case, customers are not required to come to the bank to make payments, the user is required to have only components such as a personal computer, modem and software in working order (Horvitz, 2066). At present, banks provide customers with all the operations they are allowed to perform over the Internet. After completing online membership transactions, customers can open an account using special passwords, pay invoices, contact customer representatives, apply for a loan, make transfers between accounts and create their own portfolio (Karakas, 2009, p.459). Only 1.5 years after the opening of the first digital bank.
Allocation of previously unsolved parts of the general problem.
The main purpose of the study is to investigate the features of the expansion of digital payments in Azerbaijan and to study the current and prospective effects of digital payments in the formation of financial resources of banks.
Material and methods. Statistical calculations, sample observation, synthesis, regression analysis were used in the study. Regression analysis consists of steps such as selecting the model type, calculating the parameters, constructing the model, and assessing its suitability and accuracy. The level of accuracy of the model characterizes the degree of deviation of the actual values of the dependent variable from the values obtained on regression models. Estimates such as average relative error, average absolute error, standard error are used to 30 ECONOMIC INNOVATIONS Vol. 24, Issue 4 (85) 2022 estimate the level of accuracy.

Formulation of research objectives (problem statement)
According to the Law of the Republic of Azerbaijan on the Central Bank, the Central Bank is entrusted with organizing, coordinating, regulating and supervising the activities of interbank centralized and other unlicensed payment systems.
It should be noted that in 1997, the Central Bank launched a qualitatively new direction in the formation of the National Payment System (NPS) based on best international practices within the framework of IMF technical assistance.
On February 16, 2001, the Central Bank introduced the SWIFT-based Real-Time National Interbank Settlement System (AZIPS) payment system within the framework of the World Bank's Technical Assistance to Institutional Building (OGPT) Project, focusing on the development of the EITI. . Along with the use of the system, a regulatory center has been established to facilitate its management and a Reserve Center with the most modern technical equipment.
In 2002, as a continuation of the development of the CES, the Small Payments Settlement-Clearing System (CCPS) based on new technologies that meet international standards was established and banks were provided with the use of this system.
Then, in 2008, the Centralized Information System for Mass Payments (KOMIS) was launched. This system was of great importance for the reforms in the utilities sector to be more effective. As a result of the commissioning of this system, which is based on the latest software and technology, subscribers have the opportunity to receive full information about utility debts at any payment service point and make payments through payment mechanisms.
In 2012, the Government Payment Platform (GPP) was formed as part of the KOMIS platform. The purpose of creating this platform is to make more efficient use of the infrastructure of KOMIS, to expand the process of cashless payments between the population and economic entities and to provide access to financial services in the regions. Thus, the portal provides a centralized process of collecting taxes, duties, rent and other budget payments, as well as payments for utilities, communications and other public services.
As a continuation of the reforms aimed at the development of the EITI, the Interbank Card Center (ICC) was launched in 2016 to increase the efficiency of transactions with payment cards issued by resident banks (https://www.cbar.az/). In general, there have been significant increases in the payment card infrastructure over the past 5 years. As of March 1, 2021, the number of payment cards issued by banks was 9.579 million. (Population by age group, 2021) By the end of 2020, there will be 1,338.7 payment cards per 1,000 people in the country. Pensions, pensions and social benefits, salaries of employees of budget organizations are paid by payment cards. Work on the payment of salaries to employees of private companies by card is nearing completion. As we can see from the table, the population that can be a cardholder after 2019, in theory, all of them have a payment card.
The process of making payments in the digital banking system has become possible due to technological improvements. Digital transactions currently carried out in Azerbaijan are mainly carried out through ATMs and POS-terminals.

ЕКОНОМІЧНІ ІННОВАЦІЇ
Том 24, Вип. 4 (85) 31 The increase in the number of ATMs by 68 in 2020 shows the importance of the banking system to digital banking.
The study included a regression analysis. Table  2 shows the number of banks whose licenses were revoked in 2015-2020, ATMs and POS terminals in the country as a whole, and Table 3 predicts the consequences of the reduction of ATMs and POS terminals of banks whose licenses were revoked. During the regression relationship, we encounter two conditions. If F (x, y) = 0, there is no relationship between the quantities x and y. However, if f (x, y) = 1, it is said that there is a linear functional dependence between the quantities and that they are related. Regression analysis allows us to determine the relationship between banks whose licenses have been revoked and the factors affected by this process. The main variable was the number of banks whose licenses  In this case, the ratio R2 = 0.715832 is an indicator of the above-average impact of bank closures. The analysis shows that 71.58% of the changes are due to the influence of the main variable.

Fig. 1 ATMs and POS-terminals
Compiled by the author: Central Bank of the Republic of Azerbaijanhttps://www.cbar.az/ As we can see from the analysis of the diagram, although the number of bank customers increased in 2019 and 2020, the number of POS terminals decreased. This is due to the fact that banks prefer the electronic banking system and all operations are carried out electronically.  We can clearly see from the table that the total number of payment cards in 2012 was 7266, while in the last month of 2020 it was 9230. The increase in the number of cards has naturally affected electronic payments, as well as debit and credit card transactions. Thus, if in 2019 there were a total of 162,285 card transactions, in 2020 this figure increased significantly to 226,455.
As we know, during the pandemic in 2020, the number of electronic payments increased. People made their needs such as food, clothing, etc. through electronic orders and payments. However, the increase in the number of digital payments has not increased their volume. One of the reasons for the non-increase in payments is the fact that citizens will be able to make payments electronically through POS terminals in 2020, the economic downturn due to the pandemic, the decline in wages in 2020 (or temporary job losses) will reduce people's spending. The decline in wages was mainly due to the pandemic in tourism, entertainment and a number of other service sectors. However, as a result of targeted measures, the number of labor contracts in the private sector

ECONOMIC INNOVATIONS
Vol. 24, Issue 4 (85) 2022 as of January 1, 2021 has not only decreased, but also increased by 24.0% or 154,000 compared to the beginning of 2020, and 794,000 labor contracts were registered. Another main reason for nonincrease of payments is when examining the types of cards. A number of pandemic-related jobs have been closed or suspended. Here, the issue of state support comes to mind. Thus, the increase in the number of social cards by 1,060,000 in 2020 compared to 2019 is mainly due to social payments made by citizens to the government during the pandemic. As can be seen from Table 6 and Figure 3, we observe the impact of the devaluation of the manat and the problems it creates on the expenditure of the population's income on the number of fast money transfers in banks, both inbound and outbound. Also, the revocation of the licenses of some banks can be seen as an explanation for the decline in the number of POS terminals and ATMs in some years. The number of express money transfers (included in the bank) was 3251.9 in 2019, and 2223.7 in 2020. This decrease was also reflected in the total amount of payments. Thus, the total amount of transfers in 2019 will be 927.7 million. manat, and in 2020 -803.7 million. manat. We can note that the reason for this decline is the economic recession that manifested itself in 2020.
One of the main objectives of the Central Bank in the "State Program for the Expansion of Digital Payments in the Republic of Azerbaijan" approved by the Decree of the President of the Republic of Azerbaijan No. 508 dated September 26, 2018 is to create a digital ecosystem that includes innovative payment solutions.  Conclusions and perspectives of further research. As a result of the work done in recent years to create an ecosystem of digital payments in the country, significant progress has been made in the infrastructure of contactless payments. Thus, in 2020, 26% of payment cards in circulation (2.3 million units) and 53% of POS-terminals (29.5 thousand units) support contactless payments ("The limit of contactless transactions with payment cards has been increased", 2020). For comparison, during the same period in 2018, these figures were 7% (409 thousand units) and 32% (21 thousand units), respectively.

ЕКОНОМІЧНІ ІННОВАЦІЇ
As in all countries, the demand for digitalization, contactless payments, e-commerce, e-banking services in the pandemic has become relevant in Azerbaijan. The spread of the virus by touching the surface during a pandemic has led the population to prefer contactless payments without touching the POS-terminal. In order to increase the ability of the population to make contactless payments during a pandemic, in many countries around the world have increased the limits for cashless transactions with contactless cards without entering a PIN-code. Using a similar experience, the Central Bank in 2020 increased the limit of contactless payments on cards without entering a PIN-code from 50 (fifty) to 100 (one hundred) manats and expanded the opportunities for consumers to make daily contactless payments more easily, quickly and securely.
In accordance with the strategy of expanding the contactless card infrastructure in the country, the Central Bank is working to ensure support for contactless payments on all bank cards and POSterminals in the near future. ("The limit of contactless transactions with payment cards has been increased", 2020).
Another key issue in digital banking is the number of age groups in which the population has the right to operate in the bank and their access to ATMs and POS terminals. In order to assess this possibility, it is necessary to determine the number of ATMs and POS terminals per 1,000 people of working age. The result will provide information on the access of this group of people to ATMs and POS terminals.
Traditionally, since the beginning of banking, customer services are provided through physical contact in bank branches. During the active development of remote banking services, telephone banking, terminal banking, internet banking, television banking and mobile banking emerged. As part of these payment services, payments and transfers are made from one person to another using a smartphone. However, digital banking no longer offers digital communication channels with just one customer, but digital products that meet the needs of customers around the clock. Digital banking is banking without a physical document. Leading actors provide new and improved customer experiences and provide faster and more efficient services (Lipton, 2017).
At present, the development of digital banking and digital payments within it is one of the main indicators of the development of the country's financial system. One of the first steps to determine the direction of development trends in digital payments in Azerbaijan and to choose strategic goals is to pay attention to the experience of developed countries.
The following measures are proposed for the effective operation of digital banking: 1) Based on the information obtained, banks should accelerate their activities to improve the quality of services in this area, with the forecast that the use of Internet banking will increase in the coming years.
2) Banks need to increase their investment in information technology and improve their websites in terms of security and convenience.
3) Banks should inform their customers more about internet banking, help raise awareness and strengthen their work by taking incentive measures. 4) Systematic meetings should be organized where all banks can discuss international experience in digital banking, security systems and legal regulations.