UAE - The use of digital payment is increasing at an exponential pace in the UAE as around 20 per cent of people have reported a decline in cash usage, said a new report.
According to a paper released by Amazon Payment Services, there was an instant payment “revolution” in the UAE as digital payments across key sectors in the UAE are expected to increase at a compound annual growth rate (CAGR) of 18.3 per cent from 2021 to 2023.
It said nearly half of Gen Z in the UAE use digital or mobile wallets for daily payments, compared to 48 per cent in Saudi Arabia, and 43 per cent in Egypt.
Peter George, managing director for Amazon Payment Services in the Middle East and North Africa (Mena), said Gen Z folks “certainly have the greatest propensity to demand most innovation and they are perhaps the most in-demand of seamless experiences as well. Gen Z is the youngest, but they're also the most demanding, but that keeps us on our toes as well.”
Ronaldo Mouchawar, vice-president of Amazon Mena, said the digital payments market is anticipated to nearly double in size across UAE, Saudi, and Egypt by 2023 and expects local businesses to flourish more than ever in that space.
The growth in the digital payment sector is driven by a very high internet penetration rate, a significant fintech boom, a stable economy and the large number of young population in the UAE and region.
Internet penetration in the UAE is among the highest in the Mena region, with the percentage of the population using the internet estimated at 329 per cent. With 5G internet coverage made available across the UAE, all public areas, including shopping malls and government organisations, offer free high-speed internet connections, enabling consumers to make online payments without difficulty.
The report added that the UAE leads digital banking in the region and is developing into a major global fintech hub with supportive government policy. Rising partnerships between banks and fintech companies are likely to drive innovative products and facilitate easier adoption of new fintech solutions, including in digital payments.
Peter George said digital payment is growing across mainly hospitality, travel and tourism and aviation sectors.
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