UAE - Small and medium businesses (SMBs) as well as consumers in the UAE are more digitally savvy and future-ready than their peers globally, a study has revealed
By the end of 2020, nearly all SMBs surveyed in the UAE, or 97 per cent, compared to the global average of 83 per cent, had embraced new forms of digital technology to meet changing consumer behaviors, a Visa study shows.
The “Visa Back to Business Study – 2021 Outlook,” conducted in the UAE, Brazil, Canada, Germany, Hong Kong, Ireland, Russia, Singapore, and the United States, found that both the continued SMB shift towards digital commerce and changing consumer payments habits show few signs of reversal as the calendar advances into 2021.
Looking ahead to 2021, SMBs are assessing what other payment technologies are critical to meeting today’s consumer expectations, with results led by security and fraud protection (54 per cent) and allowing installments for online payments (49 per cent, compared to 35 per cent globally, the most of all markets surveyed), Visa said in its survey report that highlights how a digital-first mindset will help power business forward and win consumer mindshare in 2021.
The UAE already ranks first in the Arab region and is one of the best in the world in the “World Digital Competitiveness Ranking 2020” issued by the IMD World Competitiveness Centre in Lausanne, Switzerland.
Ranked 14th globally, the UAE is ahead of several advanced nations and maintained its leadership in the Arab region in all categories of the rankings, most notably in the “Technology” factor where it ranks fourth globally, as well as in “ Future readiness” and “Knowledge.”
The Visa study shows more than half of consumers used contactless payments whenever possible in the last three months as the businesses that serve them embrace digital payments more rapidly than ever before.
“While there had been a sudden surge in e-commerce and digital payments in 2020 due to the impact of Covid-19, our report suggests that these trends will continue to prevail in 2021, even as the vaccines become more widely available in the country and the wider region. In addition, we believe 2021 will place greater attention on security and fraud, and trial of more emerging digital commerce tools that can help SMBs in the UAE thrive,” said Shahebaz Khan, general manager for the UAE, Visa.
The study shows that the global rise of contactless payment offerings in 2020 is showing no signs of slowing down in the New Year. In June 2020, 44 per cent of UAE’s SMBs surveyed were offering contactless payment for the first time – now, the same proportion (44 per cent) say they are doing it more often, and of those, 73 per cent plan to continue doing it over the next three months. Over four in five (86 per cent, compared to 74 per cent globally, the most of all markets surveyed) SMBs surveyed expect consumers to continue preferring contactless payments even after a vaccine is widely available.
About 74 per cent of consumers in the UAE (compared to 47 per cent globally) say they will not shop at a store that does not offer a contactless way to pay. The vast majority of UAE consumers surveyed (93 per cent, compared to 85 per cent globally) expect digital options when they shop in person, more so than any other market surveyed. Tapping a credit or debit card is the most preferred option (57 per cent), followed by paying with a mobile wallet (51 per cent, compared to 36 per cent globally) and mobile payment apps (44 per cent).
Nearly all the UAE consumers surveyed (96 per cent, compared to 61 per cent globally) are taking steps to keep their credit card clean, making them the most likely of all markets to do this.
At 94 per cent, SMBs in the UAE are the second most likely of all markets surveyed after Hong Kong (96 per cent) to have encountered customer concerns about fraud over their new use of technology (compared to 70 per cent globally), presenting an obstacle to maintaining positive engagement with their customers. Recognizing the significance of and responding to a potential fraud attack will continue to be critical in 2021 as the shift to digital sales continues to increase.
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