Cash withdrawals remain predominant in Kuwait despite a push towards digital payments
Despite significant increases in digital payment methods, cash withdrawals from ATMs continue to represent a considerable share of overall financial transactions.
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The total financial payment withdrawals in Kuwait during 2023 reached approximately 45.795 billion dinars, showing an 8.5% increase from the previous year. Even with a slight decline in ATM withdrawals, these still made up roughly 23.5% of all transactions, totaling 10.722 billion dinars.
The volume of transactions at point-of-sale terminals reached 17.519 billion dinars, and online payments experienced a notable surge to 17.553 billion dinars. The Kuwaiti government has implemented measures to minimize cash usage, including prohibiting cash transactions for real estate and pharmacy purchases exceeding 10 dinars, as part of efforts to combat money laundering.
However, the continued reliance on cash can be attributed to factors such as increased household expenditures due to inflation and a significant segment of the workforce being unbanked.
The black market also significantly influences the high rate of cash withdrawals, especially for money transfers and illegal activities such as drug trafficking. Despite regulations aimed at preventing money laundering, a preference for cash transactions exists among some individuals to elude monitoring.
Kuwait stands out for its financial digitalization within the Gulf region, yet reducing cash transactions poses a challenge. With digital payments projected to hit $11.95 trillion globally by 2025, the trend indicates a move away from cash worldwide. Although countries like Sweden have made strides in diminishing cash usage, Kuwait faces ongoing challenges in shifting away from cash transactions, underscoring the necessity for enhanced measures to foster the adoption of electronic payments.
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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
