New research from payment solutions provider Checkout.com has revealed that half of UAE residents are using digital wallets for the first time.
According to the survey, security is still the most important factor for UAE residents when shopping online, with nearly 40% of respondents trusting digital wallets as much as banks. Indeed, the future looks bright for digital wallets, with 48% of respondents believing that digital wallets will usher in a cashless society within a decade.
The survey sought to discover the rise in digital wallet usage among UAE residents as online payments increase. According to the Checkout.com MENAP Payments Report for 2021, approximately 83 percent of UAE residents intend to maintain or even increase their current level of eCommerce spending into 2022.
According to a pulse survey of over 1000 UAE consumers, cash usage continues to decline, with only 20% of respondents saying they use COD (cash-on-delivery) for online purchases. This compares to 40% in 2020, according to Checkout.com’s 2021 MENAP report.
The ease of paying bills has fueled the growth of digital wallet usage among UAE residents, with 58 percent of respondents ranking this as the top item for which they use their digital wallet to make payments, with groceries a close second (55 percent). According to the report, 28% of UAE residents use wallets to send money to friends and family, demonstrating the popularity of peer-to-peer transactions over traditional bank-to-bank transfers. Digital wallets have the potential to disrupt the Gulf’s multibillion-dollar remittance market, with one-third of UAE residents using digital wallets to send money abroad.
“With more and more people embracing the convenience of digital wallets coupled with the reassurance of their transactions being safe and secure, digitization of the payment system is unstoppable. The findings reveal an undeniable trend towards digital wallets becoming the future of consumer payments,” said Mo Ali Yusuf, Regional Manager for MENAP at Checkout.com.
The report found little difference in online shopping habits between men and women, demonstrating that digitization appeals to both genders. However, digital wallets have a wider appeal among younger shoppers. According to the findings, 16 percent of 18-24 year-olds prefer digital wallets, compared to 9 percent of those aged 25-34.
