Cash no longer king in UAE
Only 1% of SMEs expect their business to continue trading in cash, and almost 94% of consumers in the UAE say they will continue using digital payments as much or more than they did in 2021, research by Visa has found.
A majority of small businesses in the UAE (71%) said they already are cashless, or plan to be within the next two years, while more than half of UAE consumers (52%) plan to be cashless by 2024 and nearly all consumers (99%) see benefits of a cashless society, according to the Visa Back to Business Global Study – 2022 SMB Outlook.
The trend towards a cashless society in the UAE would appear to be irreversible, according to the survey, with 96% of small and medium businesses (SMBs) surveyed saying that accepting new forms of payments is fundamental to their growth.
Cryptocurrencies gaining traction
Other forms of digital payment methods, such as cryptocurrencies, are gaining traction in the UAE, with 35% of the country’s small business owners indicating a willingness to deal with currencies such as Bitcoin and all of them (100%) saying they plan to accept some form of digital payments in 2022.
“Payments are no longer about simply completing a sale. It’s about creating a simple and secure experience that reflects one’s brand across channels and provides utility to both the business and its customer,” said Shahebaz Khan, Visa’s general manager for the UAE, Bahrain and Oman.
“The digital capabilities that small businesses built up during the pandemic, from contactless to e-commerce, helped them pivot and survive and by continuing to build on that foundation, they can now find new growth and thrive,” he added.
Of small businesses with an online presence, nearly all in the UAE (99%) attributed their survival through the pandemic to e-commerce, which accounted for an average of 58% of revenue.
Due to ongoing supply chain issues brought on by coronavirus, 69% of UAE consumers (compared with 59% globally) are willing to buy internationally. The most important factor cited to help them feel more comfortable with international commerce is positive customer reviews (55%). This aligns to 86% of SMBs (compared with 50% globally) that plan to increase cross-border sales in 2022. However, a big majority (96%) of UAE SMBs find it challenging to accept and process cross-border payments.
The Visa Back to Business Study was conducted in December 2021 and surveyed small business owners and consumers in nine markets: the UAE, Brazil, Canada, Germany, Hong Kong, Ireland, Russia, Singapore and the United States.