Arab world online transactions up 22%
dubai — Online payment service provider Payfort said the region saw an overall 22 per cent increase in online transactions during 2016, led by strong growth in Saudi Arabia, Egypt and the UAE.
While Saudi Arabia recorded a 27 per cent growth in online transactions, Egypt witnessed a 22 per cent surge.
The UAE, which has the highest rate of consumer acceptance of online payment at 71 per cent, recorded a 21 per cent year-onyear growth.
In its fourth “State of Payments in the Arab World” report, Payfort, an Amazon company, identifies ‘events and entertainment’ as the fastest growing payments sector showing annual 33 per cent growth from 2015 to 2016.
In a new interactive format, the report offers up-to- date data and analysis on the region’s payment trends and consumer buying habits. Based on the study of seven key countries for the regional payment industry, the report shows different data and insights and four key online payment segments: airline, travel, e-commerce and entertainment sectors.
An earlier report forecasts that the volume of online payments in the Arab world could increase nearly three times by the year 2020 to reach more than $69 billion of transactions per annum.
“Our 2017 edition of the State of Payments report marks the most dramatic change to the report since we launched the project in 2014,” said Omar Soudodi, Managing Director of Payfort.
“Each year we’ve worked hard to ensure that the report delivers more value than the last, shedding light on real issues for the region’s online business merchants. However, this year we put the control in the hands of our readers, providing them with interactive tools that allow them to easily adapt the data sets for their own needs and business decision making,” he said.
Research revealed that there is still plenty of room for growth in several Fintech market segments. For example, 17 per cent of those surveyed in the UAE are looking for new and better alternatives to send international money transfers. There is also a sizeable opportunity for online wallet solutions, with around 47 per cent of consumers across the region yet to adopt the technology.
A total of $30.4 billion of goods and services were purchased online in the seven countries during 2016, increasing 22 per cent on the $24.9 billion of payments during 2015. The top countries in terms of dollar value and growth in value were the UAE with $12.4 billion of transactions and 21 per cent annual growth in total amount paid online; Saudi Arabia with $8.3 billion of transactions and 27 per cent growth; and Egypt with $6.2 billion of transactions and 22 per cent growth.
Saudi Arabia was the fastest growing country in the airlines and travel sectors, showing 21 per cent year-on- year growth in airline payment volume and 36 per cent growth in travel and tourism. Egypt led the region in the growth of online shopping with a 32 per cent increase in volume of payments.
Meanwhile, the UAE was the fastest growing country in the entertainment and events sector, showing 36 per cent growth.
Security remains the top concern among those that choose not to pay for goods and services online, with more than 50 per cent of cash-on- delivery customers surveyed in all countries stating that they would only switch to online payments if they were convinced that the payment method was secure. Cash-on- delivery was most popular as a payment option in Egypt (70 per cent usage) and Lebanon (60 per cent usage).
— issacjohn@khaleejtimes.com