UAE payments revenues projected to reach $18.7 billion by 2031

According to the new Boston Consulting Group (BCG) report “Global Payments 2022: The New Growth Game,” payment revenues in the United Arab Emirates (UAE) are expected to reach $18.7 billion by 2031.

BCG’s 20th annual analysis of the UAE payments industry predicts a 7.7% compound annual growth rate (CAGR) on payment revenues from 2021 to 2031. Credit card, debit card, and current account revenues will be among the areas of particular strength.

Mohammad Khan, Managing Director & Partner, BCG, said: “The UAE continues to see robust growth in payments and fintech activity in general. This year alone we have seen the launch of multiple digital banks as well as specialized payments players. A combination of drivers—such as the country’s young, tech-savvy, and fast-growing population, the nation’s bid to become a crypto and fintech hub, and the planned launch of a domestic payments scheme are resulting in greater competition and paving the way for future growth. Cross-industry participation in digital payments will provide an added impetus to the region’s already burgeoning sector.”

Four Trends Driving the Global Payments Industry

Over the next five years, the report outlines four trends that will shape the outlook for the global payments industry, which has some impact on the UAE:

• The era of non-profitable growth is over. Payments players will have to demonstrate solid profitability to attract both customers and investors. 
• Demand for electronic payments is getting stronger. The sustained cash-to-noncash conversion, the ongoing growth of e-commerce, and the increasing integration of payments into retail and corporate customer journeys will drive payments revenues globally
• Central bank digital currencies (CBDCs) are gaining momentum. Central banks are tailoring CBDCs to complement cash with digital central bank money to implement monetary policy faster.
• Payment businesses are under increasing scrutiny from regulators. Market participants must address risk dimensions, be it financial, compliance, cyber, or crypto to install the required safeguards for their businesses on their path to growth.

“Payments revenues in the GCC will see acceleration on the back of real-time payments infrastructure, a growing number of specialized payments players bringing new solutions to the market, and enabling policies from governments,” concluded Khan.