YEREVAN, February 9. /ARKA/. Last week, Armenia’s financial market was shaped by monetary policy decisions, changes to payment infrastructure regulations, and regulatory signals regarding the cryptocurrency sector. The foreign exchange market was characterized by moderate dynamics without sharp fluctuations. In the capital market, attention was focused on the indicators of the organized market and the activity of corporate issuers. In the insurance sector, an institutional deal involving international groups was a key event.
1. Monetary Policy: Refinancing Rate Maintained
On February 3, the Board of the Central Bank of Armenia maintained the refinancing rate at 6.50%. The Lombard repo rate remained at 8.00%, and the fund raising rate remained at 5.00%.
This decision fixes the current price of money in the economy and maintains the interest rate framework for the entire financial market. For the market as a whole, this could mean stability in short-term yield targets and no revision of funding conditions. For banks and borrowers, the current pricing parameters for loans, deposits, and money market instruments remain in place.
2. Payment Infrastructure: Reduction of Maximum Commissions for Non-cash Payments
The Central Bank of Armenia has decided to reduce maximum commissions for accepting non-cash payments: effective March 1, the maximum level has been set at 0.5% for ArCa cards and 0.9% for international cards. It was also announced that all government payments will become cashless starting April 1, 2026.
This may represent a shift in the economic conditions for cashless transactions and a redistribution of income within the payment chain. A uniform price cap for acquiring is being established, increasing the predictability of transaction costs and stimulating the expansion of cashless payments. Banks and payment operators will need to adapt their pricing models and operational processes, but this will be done within the context of the overall growth in cashless transactions.
3. Crypto Market and Compliance: Strengthening Identification Requirements
CBA Chairman Martin Galstyan stated the need for the strictest possible identification of crypto company clients, including verification of sources of funds, purposes, and parties to transactions. He also noted the ongoing development of the supporting legislation for the cryptoasset law.
For the financial market as a whole, this could mean enshrining strict standards for the transparency of cryptoasset transactions and reducing regulatory risks at the intersection of the crypto and traditional financial segments. Strengthening requirements creates more uniform rules for access to settlement infrastructure. For banks and crypto providers, this translates into an increased role for KYC/AML procedures, but the key effect is increased comparability and controllability of market transactions.
4. Foreign Exchange Market: Exchange Rate Movements in a Narrow Range
According to the CBA, the exchange rates of major currencies against the dram fluctuated within a narrow range over the week; On February 6, the dollar exchange rate was 377.70 drams, the euro 445.38 drams, and the ruble 4.9058 drams.
Moderate exchange rate dynamics may indicate support for settlement stability and asset revaluation. For the market as a whole, this may indicate the absence of additional currency shocks and the maintenance of current conditions for foreign trade and financial transactions. For banks and businesses, this may indicate the ability to continue operations within existing currency limits and price targets without immediate adjustments to strategies.
5. Capital Market: Organized Market Dynamics and Corporate Bond Growth
The Armenian Securities Exchange reported that organized market capitalization increased by 6.96% in January, exceeding AMD 473 billion. Moreover, according to the Ministry of Economy, the Armenian corporate bond market grew approximately fourfold between 2018 and 2025, reflecting the increased use of debt instruments by companies.
For the financial market as a whole, the growth in capitalization and the exponential increase in the volume of corporate bonds may indicate institutional strengthening of the capital market and its expanding role as a source of financing.
6. Insurance: Launching Life Insurance as a New Market Segment
Central Bank of Armenia Chairman Martin Galstyan stated that Armenia is implementing its first practical experience in introducing life insurance, which became possible as a result of the acquisition of the Armenian insurance company LIGA Insurance by the international groups Grawe Group and C-Quadrat Investment Group. According to him, this creates the preconditions for launching life insurance products in the Armenian market.
For the financial market as a whole, this may indicate the emergence of a new long-term insurance services segment previously absent from the national system. The introduction of life insurance may expand the functionality of the insurance market and create an additional channel for accumulating long-term resources, changing the structure of financial intermediation.
7. Banking Sector: Cross-Border Transfers and Supervisory Focus on Retail Lending
According to the Central Bank of Armenia, the net inflow of cross-border transfers from individuals through the banking system in 2025 amounted to $1.64 billion, compared to $1.51 billion the previous year. Last week, the head of the regulator, Martin Galstyan, stated that mortgage and consumer lending remain areas of increased attention from the Central Bank, given their share in banks’ portfolios and their importance to financial stability.
For the financial market as a whole, the combination of stable cross-border inflows and a heightened supervisory focus on retail lending may reflect a balance between liquidity sources and the quality of its placement. Money transfers support the resource base and consumer activity, while the regulator’s focus on mortgages and consumer loans shapes the risk management framework in one of the most sensitive market segments.
Weekly Summary
The week saw the maintenance of a stable interest rate framework and the simultaneous reconfiguration of certain financial market segments. Acquiring and compliance decisions in the crypto sphere set new operating conditions without changing the fundamental macro and interest rate benchmarks.
Overall, the market adapted to updated rules in the payment and regulatory infrastructure while maintaining predictable currency and interest rate parameters. Institutional changes, the expansion of non-cash flows, and the development of organized segments of the capital and insurance markets remained the focus.
