Cashless society: Kyrgyzstan requires all businesses to no longer accept cash – only cards or QR codes are allowed

The small Central Asian country of Kyrgyzstan has made the controversial decision to force businesses to operate completely cashless – they will only be allowed to accept card or QR code payments, according to a plan by the country’s central bank.

The Kyrgyz government has decided to require businesses to accept payments only via bank cards or electronic wallets. The new procedure will come into effect after a transition period of several months, the local media reported, citing a Cabinet of Ministers resolution on tax administration reform.

The document mandates the transition to cashless payment methods. This change affects all municipal retail and service businesses. Shop, restaurant, and business owners must therefore install POS terminals or connect to online payment systems.

According to a government decree, this decision is part of the policy on income transparency and combating the shadow economy. At the same time, all transactions will be recorded in electronic systems.

An exception applies only to rural and hard-to-reach areas where the digital infrastructure is not yet sufficiently developed – cash payments will remain temporarily permitted there.

According to the authorities, the transition to a cashless payment system should allow the state to monitor financial flows more quickly, bringing Kyrgyzstan closer to a “civilized form of tax control”.

The tax service and the National Bank of the Republic of Kyrgyzstan are responsible for implementation.

Changes to the tax law have already come into effect: fines and penalties are now calculated automatically – without the involvement of a tax inspector. The amount of the penalty corresponds to the statute of limitations for the tax debt.

Furthermore, cash payments are excluded. Taxes can only be paid electronically – for example, via digital self-payment systems (DPS) or the Unified Tax Account. The authorities aim to fully automate the tax control process with this measure.

At the end of October this year, President Sadyr Japarov signed a law amending the Labor Code, according to which employers are obliged to pay wages exclusively in cashless forms.

QR codes as a new payment standard

Recently, the business website Akchabar reported that this move builds on existing laws that had abolished fees for digital transactions to promote electronic payments. Now, QR codes via smartphones are set to become the leading payment method.

The main driver of this digital revolution was the decision by the National Bank of the Kyrgyz Republic, which came into effect on November 25, 2024: fees for domestic transfers in KGS between private persons were abolished – both within the same bank and between different banks.

Previously, banks charged fees of between 5 and 20 KGS per 1,000 KGS, and up to 100 KGS for larger amounts. Following the abolition of these fees, electronic payments increased sharply: In the first quarter of 2025, 177.5 billion KGS in cash was withdrawn – around 30% less than in the same period of the previous year. The number of cash withdrawals fell by 26.3% to 16 million transactions.

QR payments are now among the most popular cashless payment methods: By May 1, 2025, 87 million payments worth 146.1 billion KGS had been processed via QR codes – that’s 13.5 times more transactions and 22.8 times more revenue than in the previous year.

The area of cashless payments to the state saw particularly strong growth – 13.7 million transactions worth 4.1 billion KGS (371 times more than in the previous year).

Today, nearly all commercial banks (except EcoIslamicBank) and 12 payment service providers offer QR-based services. Nationwide, 71,600 QR codes are installed in shops and service establishments – around 4,000 of them in the last month alone. By comparison, there are only 2,560 ATMs and 44,317 POS terminals in the entire country.

This makes QR payment the most widely used cashless payment method in Kyrgyzstan.

In the first quarter of 2025, citizens made 24 million QR payments – four times more than in the same period of the previous year. The total value of remittances rose to 21.6 billion KGS. Interbank transfers exploded from 916,000 to 45.6 million – an increase of almost 49 times.

Transfers within the same bank also increased, from 4 to 15 million.

In the first quarter of 2025, banks generated over 5 billion KGS in fee revenue – almost one billion more than in the previous year.

Finally, the state also benefits: Every digital payment is a recorded, analysable transaction.

For citizens, this may seem like a convenient measure, but in reality it is the beginning of a total surveillance by the state.

yogaesoteric
November 9, 2025