The study deals with market activity during the past 12 months, especially the repercussions caused by the “Covid-19” pandemic, highlighting the most prominent trends and insights derived from Visa transaction data, how and where consumers spend, in addition to the new challenges and opportunities that resulted from the crisis, according to the Emirates News Agency. WAM.
According to the results of the “Stay Safe” survey conducted by “Visa”, the company operating in the field of digital payments technology, in partnership with the Dubai Economy and Dubai Police in June 2020, 49% of consumers participating in the UAE said that they have become more popular in shopping online as a result of the pandemic. 3 out of 5/61% / prefer to pay for e-commerce purchases using cards or digital wallets instead of cash on delivery.
The results of the survey showed that increased confidence in the levels of safety, speed and convenience provided by contactless payments was one of the main factors behind their increasing preference for online payments.
Moreover, the advanced logistical infrastructure, the proliferation of bank accounts, support for digital payments, the increasing reliance on e-commerce platforms among retailers, government policies that support innovation and entrepreneurial activities have contributed to driving the growth of e-commerce in the UAE, and several initiatives have been launched, including the Mohammed Bin Fund Accelerator Rashid Innovation, launched by the Ministry of Finance, has a great impact on the advancement of this sector.
As a result of the shift towards online payment, e-commerce is expected to acquire a greater share of the total value of card payment transactions in the UAE during the year 2020, and when comparing current indicators with previous readings of the pandemic, an increase ranging between 19.7% and 21.9% in the volume of transactions was observed. Electronic payment through e-commerce platforms, and these numbers are likely to rise, as e-commerce payments are expected to stand behind about 28.2 percent of the total value of card payment transactions in the UAE.
The results of the joint study between the Department of Economic Development in Dubai and “Visa” show that consumers in the country still prefer to pay using credit cards (about 35 percent of transactions), while the rates of using debit cards for online shopping increased by more than 7 percent between 2018 and 2020. This reflects the growing confidence in electronic payment transactions and the maturity in the market.
The card enhancement with coding features and Visa click-to-pay solutions encouraged consumers to make frequent purchases, in addition to the increase in the frequency and ease of online shopping, and consequently the growth in the use of credit and debit cards as a method of payment.
Sami Al Qamzi, Director General of Dubai Economy, said that the continuous growth in the shift towards digital payments in the UAE is not only a measure and strong evidence of the efficiency of the infrastructure and the readiness of the regulatory framework in the country, but it is also an indication of the increasing confidence among consumers, customers and companies alike.
Al Qamzi added: The Dubai economy has paid great attention to digital payments as a major enabler of facilitating business and smart transformation that would place Dubai in an advanced position as a global and competitive center for business compared to other cities around the world.
And he continued: Today we also set our sights on providing innovative digital solutions to various groups of society, including companies, businessmen and customers, and the Covid-19 pandemic has provided valuable insights and ideas about their changing requirements.
He pointed out that cashless payments and e-commerce in general are taking steps faster than expected, expressing his aspiration to translate this unprecedented growth into an opportunity for various types and sizes of companies to develop their presence and presence through the cyberspace.
He stressed that the main results of the study “The E-Commerce Landscape in the United Arab Emirates 2020” will contribute to providing strategic support for their future initiatives aimed at enhancing customer happiness through innovative non-cash and contactless transaction solutions.
Based on the latest transaction data provided by “Visa”, the study “The E-Commerce Landscape in the United Arab Emirates 2020” compared the UAE market with a number of mature and emerging markets such as the United States, the United Kingdom, Australia and Singapore, in addition to Brazil, South Africa and Malaysia, in the Middle East and North Africa region. And South Asia, the UAE has the highest annual rate of spending per online shopper, at $ 1648 per person.
Moreover, the UAE continues to maintain its leadership in the average volume of transactions compared to mature and emerging e-commerce markets, as the average value of transactions reached $ 122 between 2019 and 2020 compared to $ 76 in mature markets and $ 22 in emerging markets.
In conjunction with the trend of more merchants to establish their presence on the Internet and the availability of a wider range of products in the e-commerce space, the demand rates among consumers and online sales have increased by several times.
In this context, Marcello Baricordi, Director General of Visa for the Middle East and North Africa, said that the digital payments system in the UAE and the MENA region has already witnessed strong growth, but the pandemic has contributed to the acceleration of change and the shift towards this system, as we have seen an increasing demand from consumers for Shop through e-commerce platforms and the contactless payment system during the lockdown period.
Baricordi expects these behaviors to contribute to establishing new habits that will continue even after the pandemic subsides, in light of the desire of more consumers and merchants to enjoy the benefits of safety, ease and wide options provided by e-commerce.
It is precisely for these reasons that companies that adapt to this new global reality by strengthening their electronic presence and adopting digital payments have distinct opportunities for recovery, prosperity and growth, and regardless of the size of their business, traders must think about a wider scope of adaptation to the new reality and focus on their medium and long-term strategy, Baricordi. .
It is expected that the transfer of actual shopping experiences to e-commerce platforms will be very important to maintain the rates of consumers ’shift towards online shopping. The possibility of trying a product is a major reason for shopping in the physical store, but the current era provides many tools that can contribute to making the product experience available. Hypothetically, the use of augmented reality technologies enrich the online shopping experience by giving consumers a more realistic visualization of the products they want to buy in the comfort and safety of their homes.
Providing seamless payment experiences is a critical factor in e-commerce success
The results of a survey conducted by “Visa” in 2020 revealed that more than half of consumers in the UAE / 58 percent / have abandoned the e-shopping cart due to the delay or failure of the authentication process. Here comes the role of innovative solutions such as “click to pay” from Visa to help reduce These negative consequences, in addition to the adoption of electronic payments as the main option and abandoning payment on receipt, would contribute to reducing costs, complex procedures and risks that may be exposed to online merchants.
Baricordi added that the UAE market enjoys world-class readiness that allows the e-commerce sector and the digital payments system to thrive unmatched due to the availability of many factors ranging from policies that encourage digital technologies to support measures, high-speed internet, and the widespread use of smart phones, social media and infrastructure. World class.
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