Mastercard’s Vision for a Digital and Green Economy in the UAE
The surge in digital payment adoption has been remarkable, with Mastercard data highlighting a swift rise in new payment methodologies.
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The total expenditure through international cards in the UAE saw an increase exceeding 25% over the course of 2023. J.K. Khalil, the General Manager for MENA East at Mastercard, observed that digital payments have been witnessing substantial growth within the UAE, with a growing number of users and businesses preferring them over traditional cash transactions due to their enhanced convenience and security levels. Additionally, Khalil pointed out the essential role of international card expenditures in both the UAE and GCC regions in facilitating the recovery of the travel industry.
The Expanding Scene of Digital Payments
The volume and value of transactions via card and digital payment methods across the Middle East and North Africa have experienced a significant uptick, with a 20% increase in value and a surge of over 50% in transaction volume. This marks a notable shift towards digital payments for daily expenditures.
Khalil attributes this growth to the consumer demand for speed, convenience, and security, which are the primary motivators behind the expansion of digital payment systems. He reinforced Mastercard’s dedication to refining transaction processes and boosting payment efficiency across the region through strategic partnerships and comprehensive digital payment solutions.
Insights from Mastercard’s payment index reveal an impressive adoption rate of innovative payment methods, with 85% of people in the region and 88% in the UAE adopting new payment technologies such as mobile contactless payments, “buy now, pay later” options, cryptocurrencies, and wearable devices.
Furthermore, Khalil highlighted the growth in cross-border payments, especially significant in connecting expatriates with their home countries, a crucial factor in regions with large expatriate communities like the GCC.
According to Mastercard’s 2023 cross-border payments report, 48% of UAE residents expect an increase in cross-border transactions in the next 12 months, with 36% anticipating receiving more international payments within the same timeframe. Khalil reiterated Mastercard’s commitment to supporting communities with safe, convenient, and efficient international money transfer methods at reasonable costs, with services reaching over 180 countries and covering more than 90% of the world’s banked population.
Khalil also emphasized Mastercard’s focus on financial inclusion, aiming to integrate one billion individuals and 50 million micro, small, and medium-sized enterprises (MSMEs) into the digital economy by 2025.
Mastercard is set on providing the necessary digital support for small businesses to flourish in the digital economy, offering customized payment solutions to help startups and SMEs execute secure, quick transactions and expand their customer reach.
He also mentioned Mastercard’s “Sustainable Cards Pledge” introduced at COP28 in the UAE, aiming for a transition to sustainable card materials by 2025. This initiative saw immediate support from over ten financial institutions, positioning the UAE as a leader in sustainable card adoption, ahead of Mastercard’s global 2028 target.
A study by Mastercard indicated a growing emphasis on sustainability among Middle Eastern consumers, with a vast majority ready to act on environmental concerns, signaling a shift towards supporting brands with strong commitments to environmental sustainability.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
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Employment grew for the 16th consecutive month as companies expanded.
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According to a recent PMI report, Qatar experienced its fastest non-energy sector growth in almost two years in June, driven by surges in both existing and new business activities.
The Purchasing Managers’ Index (PMI) headline figure for Qatar reached 55.9 in June, up from 53.6 in May, with anything above 50.0 indicating growth in business activity. Employment also grew for the 16th month in a row, and the country’s 12-month outlook remained robust.
The inflationary pressures were muted, with input prices rising only slightly since May, while prices charged for goods and services fell, according to the Qatar Financial Centre (QFC) report.
This headline figure marked the strongest improvement in business conditions in the non-energy private sector since July 2022 and was above the long-term trend.
The report noted that new incoming work expanded at the fastest rate in 13 months, with significant growth in manufacturing and construction and sharp growth in other sectors. Despite the rising demand for goods and services, companies managed to further reduce the volume of outstanding work in June.
Companies attributed positive forecasts to new branch openings, acquiring new customers, and marketing campaigns. Prices for goods and services fell for the sixth time in the past eight months as firms offered discounts to boost competitiveness and attract new customers.
Qatari financial services companies also recorded further strengthening in growth, with the Financial Services Business Activity and New Business Indexes reaching 13- and nine-month highs of 61.1 and 59.2, respectively. These levels were above the long-term trend since 2017.
Yousuf Mohamed Al-Jaida, QFC CEO, said the June PMI index was higher than in all pre-pandemic months except for October 2017, which was 56.3. “Growth has now accelerated five times in the first half of 2024 as the non-energy economy has rebounded from a moderation in the second half of 2023,” he said.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
