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| 19 September, 2018

UAE residents to double card spend in five years

It will grow to nearly half of overall purchases made by UAE residents, says banking executive

Woman using cell phone cashless payment

IMAGE USED FOR ILLUSTRATIVE PURPOSE ONLY

Woman using cell phone cashless payment IMAGE USED FOR ILLUSTRATIVE PURPOSE ONLY

Getty Images/ Compassionate Eye Foundation

Spending through cards will grow to nearly half of the overall purchases made by UAE residents in the next four to five years, according to the retail head of Dubai's largest bank.

Suvo Sarkar, senior executive vice-president and group head of retail banking and wealth management at Emirates NBD, said spending through cards continues to grow in the UAE.

"Only 20 per cent of personal consumption expenditure is made through cards while 80 per cent is with cash overall. Card industry spend is growing 10 to 12 per cent year on year because we are displacing cash. Emirates NBD card spending is growing 15 per cent annually, higher than the industry average. But it doesn't necessarily mean that the total retail spend is growing between cash and card. What it means is that the card part of that spend is growing.

"We are very confident that it will grow further in the next few years. In four to five years, we hope that around 50 per cent of spend will be made through cards in the UAE," Sarkar said on Tuesday after the launch of a credit card by Emirates NBD and Emaar Properties.

He said the bank is putting a lot of emphasis on promoting the use of debit card among customers.

According to Euromonitor International's figures, UAE consumers spent Dh216.5 billion through cards last year.

"When you carry cash, there are issues of security, loss and convenience - all that should drive consumers towards cards. We are hoping that card spend growth continues as we are encouraging customers that this is the better way of spending money rather than carrying cash," he added.

Replying to a query about default rates among card users, Sarkar said the loss rates are still below the expected level.

"Loss in card spectrum is under five per cent. Of the overall retail book, we are less than two per cent of loss rate. We are well within the loss tolerance level in our assets," Sarkar added.

Earlier, the two Dubai firms launched three variants of Emirates NBD U by Emaar Visa Credit Card which allows customers to earn and redeem Upoints at 1,500 Emaar touchpoints across its hotels, restaurants and leisure assets.

Among the three variants, family card is free for life while the signature card comes with a Dh500 joining fee and Dh250 annual fee while the infinite card has a Dh2,500 joining fee and Dh1,500 annual fee. The minimum salary requirement for the family card is Dh5,000+; Dh15,000+ for signature and Dh35,000+ for infinite.

Cardholders will enjoy a 30 per cent discount on dining at Emaar's hotels, entertainment destinations, complimentary travel insurance, buy one get one free Reel Cinemas tickets and access to over 850 airport lounges worldwide.

Khaleej Times: Copyright © 2017 Khaleej Times. All Rights Reserved. Provided by SyndiGate Media Inc. (www.Syndigate.info).

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