ECONOMY

Capital controls save the day for certain types of businesses

capital-controls-save-the-day-for-certain-types-of-businesses

The vast majority of Greek households and corporations may be struggling with the capital controls introduced on June 28, but there are some who are net gainers, at least in the short term, such as groups offering services that are necessary for online transactions and manufacturing raw material producers who have replaced foreign suppliers.

The companies that produce Point of Sale (POS) credit card terminals or the cards themselves are among the leading examples of those who have seen their profits grow thanks to capital controls.

From late June to early November it is estimated that up to 22,000 POS were sold, with estimates for the entire second half of the year putting the figure at 40,000, more than double through 2014 when 15,000 such machines were sold. Market estimates foresee 200,000 POS operating in Greece, rising to 300,000 by end-2017.

The number of new debit cards issued in the first three months after the capital controls came into force came to 2 million, taking the total of cards in use in Greece to 10 million. There are big benefits for the major companies operating online transactions, such as multinationals Visa, MasterCard, American Express and Diners Club, as the rise in electronic transactions has boosted their commission. Visa Europe reported an increase of 135 percent in online transactions after the capital controls.

Other companies to have gained from the development of online transaction networks are Printec, Wincor Nixdorf, Mellon Technologies and Quest, as the total turnover of credit and debit card use in Greece exceeds 8 billion euros per annum and in the medium term could grow above 20 billion, according to experts.

Electronic banking has also soared, benefiting the firms offering such services, to say nothing of state coffers that take their share directly from online transactions, unlike in many cash exchanges.

Several Greek producers and suppliers, ranging from chemical industries to food producers, have increased their output in response to a spike in demand for domestic products after imports became far harder to attain.

Other gainers have been foreign banks, including those of Cyprus, which saw their liquidity bolstered from the transfer of corporate accounts by Greek companies performing international transactions, such as shipping firms.