Thursday, May 26, 2016

Dubai: Domestic card spending in the UAE rose 12 per cent in the first quarter of this year over the same period in 2015, despite a drop in consumer confidence in the country and concerns over the global economy, according to a report from Network International, a payment solutions company.

Overall card spending in the UAE rose 7 per cent, largely due to the influence of regional consumers, while e-commerce card spend jumped 27 per cent, as per the report, which is based on credit and debit card transactions in the UAE between January and March 2016.

Spending by UAE-issued cards showed the strongest growth, along with the rest of the Gulf countries whose spend have increased by 3 per cent.

“Domestic card spenders in the UAE continue to remain the most positive influence on the economy’s growth … additionally, online spends have increased more than ever before and represent the changing shopping preferences of customers in the country. Retailers will have to adopt to these shifting patterns and expand their online offerings to take full advantage of the growth potential of e-commerce,” stated Bhairav Trivedi, chief executive of Network International.

Meanwhile, overall tourism spend declined by 6 per cent in the UAE in the first quarter “due to a continuous appreciation in the US dollar along with a bullish global economic outlook and a fall in the prices of crude oil, [with] the largest declines from China (26 per cent) and Russia (24 per cent),” the company said in the report.

The food and beverage industry saw increased domestic card spending of 19 per cent, while overall card spend rose 17 per cent.

Top international card spending growth came from the Middle East and Africa region, including Saudi Arabia, Egypt and Qatar. Americans showed an increased appetite with a 20 per cent growth, while the UK had a 12 per cent increase.

In the luxury retail sector, card spend dropped 15 per cent in the first quarter of this year due to a decline in spending from the Chinese and Russians. There was also a significant decline in card spend by consumers from the United States and Saudi Arabia.

Both overall and domestic card spend in the hotel industry declined 3 per cent in the first quarter, with a 10 per cent drop in average per purchase spend. Additionally, card spending from the United Kingdom rose 17 per cent.

Supermarkets card spend grew by 21 per cent in the first quarter. The largest spike in supermarket spending came from cards issued in Egypt (up 70 per cent) and Saudi Arabia (up 43 per cent).

Staff Report

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