The survey found that following the outbreak, an increasing number of consumers in the UAE are confident in digital payments, which will be the new normal.
MasterCard’s report surveyed 15,569 consumers in 18 countries between February 26 and March 10.
Two-thirds of respondents in the UAE and 63 percent of the companies surveyed in the US said that they had recently tried a new payment method that would not normally be used.
The outbreak prompted customers to “experiment with flexible new payment methods to get what they want when they need it.” The COVID-19 outbreak has also accelerated existing trends in the payments industry, including a shift to e-commerce, including digital payments for contactless transactions, instant payments, and cash swaps.
“The outbreak caused us to change our minds, some of them out of necessity,” said Craig Worth, MasterCard’s chief product officer.
The use of digital payment methods has grown rapidly since the start of the COVID-19 as fear of infection has driven people to shun contactless payment methods such as cash and shift consumption to mobile payments and other payment methods. As the world becomes more connected and consumer trust in online shopping continues to develop, consumer spending through online retail platforms is set to grow significantly in the coming years.
According to Statista, global digital payments will rise to 8.3 trillion dollars by 2024, from 4.4 trillion dollars last year.
In the United Arab Emirates, nearly 88 per cent of face-to-face transactions are contactless, MasterCard says. In the first quarter of this year, MasterCard made nearly 1 billion more contactless transactions worldwide than it did in the same period last year. The report shows that nearly 70 percent of consumers worldwide expect to use contactless cards this year.
In line with the global average, more than three-quarters of respondents in the UAE said they preferred to shop in small businesses with physical and online businesses. Consumers are slowly shifting to a cashless approach, and Saudi Arabia expects non-cash transactions to account for 70 percent of all transactions by 2030. As a result of this shift, a variety of digital payment platforms are likely to enter the market, such as online wallets and fintech products, where people can buy items and then pay for them.
Nearly 78 percent of respondents in the United Arab Emirates said they intend to shop at retailers that offer the latest payment methods and would be more likely to choose merchants that offer a variety of payment methods.
As early as June 2020, a survey released by the Dubai Department of Economy, Dubai Police Department and Visa showed that since the outbreak, the majority of consumers in the UAE (61%) preferred to use a card or digital wallet for online payments rather than COD.
The use of mobile wallets in the UAE has increased as Google Pay, Samsung Pay and Apple Pay join the competition with local payment companies.