Financial technology is the engine of economic growth

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Fintech solutions in the UAE have recently seen strong growth, coinciding with the launch of new payment tools and platforms by service providers and the proliferation of digital payments in the country, in addition to the fact that many emerging financial technology companies in world have taken the UAE as their headquarters, as experts confirm.

Experts told Al-Bayan that the financial technology sector in the UAE has become a supportive driver for the activities of many other economic sectors, particularly e-commerce and smart logistics services. The consulting company, AT Kearney, expects the growth of the e-commerce market in the UAE from $ 10 billion in 2021 To reach $ 17 billion in 2025.

According to the latest data from the Ministry of Economy of the country, the value of the financial technology sector in the country is 2.5 billion dollars and leads the market of the Middle East and North Africa, while “Murder Intelligence” showed that the financial technology market in the UAE United Arab Emirates. is about to grow at a compound annual growth rate of 12% by 2020. 2027.

Based on recent analysis in this area, the Corona pandemic has played a major role in accelerating innovation in the digital payment space. The use of banknotes and coins has been reduced in all retail stores, restaurants and other service sectors, so that consumers have replaced credit cards or electronic payment methods for cash transactions to make payments. Companies have also worked on more digital payment options for customers and clients, such as providing digital connections to make payments and scanning QR codes like Q.

electronic commerce

As a natural result of increased investment in online shopping, the popularity of e-commerce platforms is growing, as e-commerce platforms are also looking for improved ways to provide better customer service, such as the delivery of goods on a scale, same day delivery, and easy payment solutions to gain customer loyalty, with improved service. Interest in such platforms is growing, and thus the demand for digital payment solutions and services is growing.

According to the Big Commerce study, e-commerce is an industry that is growing at a nearly quarterly rate and represents an important path through which the adoption of digital payments continues to grow.

Regarding the role of digital payments in promoting e-commerce and the size of the electronic payment market, Dr. life, especially with the digital revolution we are witnessing now, which includes systems Banking and financial services, on the contrary, electronic payments are one of the services that are growing and advancing significantly.

Specifically in the Middle East, closures and restrictions on movement have encouraged brands and consumers to switch to cashless payment alternatives.

E-commerce cannot continue without electronic payment systems that allow it to offer a variety of payment options to its customers and that fully meet customer expectations by providing a fast, secure and convenient payment process.

Another reason that makes electronic payments more popular is the security element, as electronic payment systems provide encrypted services that protect the information of private clients during financial transactions. She noted that the UAE is also witnessing a huge increase in the adoption of non-interchangeable encrypted (NFT) arguments driven by “blockchain” technology.

According to a recent survey with more than 1,400 people in the country who own at least 23% of the population of the United Arab Emirates (NFT). As a result, ownership of non-exchangeable arguments is gaining momentum and highlighting the UAE’s innovation efforts.

fast trade

For his part, Soham Chukshi, co-founder and CEO of Chipsy, said digital payments have enabled the accelerated express trade sector, which is based on meeting growing demand and improving delivery time to better serve customers , more transparent and faster.

According to research by Redsair, fast trade has already accounted for 20% of the digital economy in the MENA region and will contribute $ 20 billion to the total value of goods by 2024.

He added that the growing popularity of the model and the customer’s tendency towards appropriate purchasing methods will push e-commerce brands to focus on delivery speed, quality of service and transparency, and thus both e-commerce brands and retailers. retailers will have to rethink how they implement shipments.

Companies will face an urgent need to ensure high levels of customer visibility, make delivery management processes efficient and intelligent, and improve real-time customer communication.

They will need to focus on bringing goods closer to customers, balancing traditional inventory management processes and dark stores, increasing real-time inventory visibility, and improving third-party logistics management to comply with agreements. strict service level.

has evolved

For his part, Selesh Malhotra, General Director of Geidea at GCC, said that the payment sector in the UAE and the region in general is experiencing rapid development, against the background of traders and companies of all sizes seeking t ‘respond to digital. the trends of their customers.

He added, “We see this as an opportunity to provide appropriate and multi-channel solutions in the market to meet the needs of employers, whether they are dealing with clients or other institutions. We can help businesses reach customers more easily, support their transition to an e-commerce model, and allow them to adopt new devices and technologies to conduct transactions.

Malhotra stressed that the UAE represents a major hub for the digital economy in the region and offers great potential for companies looking to expand their operations.

The country has a strong infrastructure, a growing banking and payment sector, a rapidly growing e-commerce market, large e-marketplace offerings, and its prestigious position as the headquarters of many major regional and international companies, which makes it a global. destination for financial technology companies.

new players

Malhotra stressed that there are many competitors in this growing sector, adding that we are now seeing new players such as telecom companies, other financial technology providers, digital banks, technology companies and even some companies operating in the field of e-commerce by offered offers. to offer payment solutions.

We stand out from the others in that we are a one-stop shop, offering a comprehensive solution to support companies from the very beginning of their establishment and through the various stages of their growth and development.

We also offer a wide range of value-added services and have a dedicated team that assists companies in the process of technically integrating payment solution technologies. He said mobile devices and new technologies like virtual reality and augmented reality, which give customers a more realistic experience when making online purchases, will also support digital payments.

He added, “We expect that there will be an ongoing focus on providing a hassle-free and convenient payment experience for customers, as they are always looking for ways and means to avoid the hassles of traditional shopping methods.” This may include some updates such as in-app payments, virtual customer service assistants, more same-day delivery options, and more.

digital assets

Digital assets, such as cryptocurrencies, are expected to contribute to the further expansion of this sector, as individuals and companies seek to market more of these assets in the future. Although acceptance of these assets is still limited, many countries around the world, including Dubai, are enacting laws to ensure that transactions using these assets are conducted securely and transparently.

Buy now, pay later is another trend that is dramatically changing the way transactions are executed as customers demand more flexible payment options. Demand for contactless cards and wallets is also expected to rise, as a recent survey conducted by McKinsey showed that 53% of respondents expect these technologies to dominate the market in the Middle East.

virtual cards

For her part, Amira Fadel, Tribal General Manager for the Middle East and North Africa, said virtual cards are one of the best payment solutions technology has recently offered to companies and individuals, as it enables them make purchases and payments from anywhere online through apps or e-wallets, used on cell phones and smartphones from anywhere in the world.

She added, “Virtual cards are used through a unique platform and system that offers a unique number for each purchase or payment. There are also many features that are not available on physical cards, such as no limit on transfer value. and it’s completely free. “

And she continued: Virtual cards can also be activated or stopped immediately for any reason. There is no doubt that the security and protection offered by virtual cards during online payments and transfers adds great value to their users, especially after the escalation of electronic piracy and fraud. Users can also set their daily or monthly spending limit and customize it according to their needs through the digital platform provided by the virtual cards, in order to control their spending.

recurring payments

Virtual cards, or what is known as “VCC”, are characterized by the ability to activate them for several operations or just for one purchase, and this feature allows companies and users to set a monthly balance for cards used more than once . a certain period of time, and can also be renewed monthly as needed. . for example; Personalize a virtual card for recurring payments like the social media campaigns that businesses do on a regular basis.

Virtual payment cards once have the ability to set a spending limit, which increases the level of security and ease of use, in addition to suspending their use immediately after the payment process, for example; Buy a ticket.

On the reasons for the growing demand for virtual cards in the region, Fadel said: “There is no doubt that the ability to issue virtual cards and the possibility of stopping them immediately is one of the most important reasons for the growing demand for them.” In addition to the ability to set costs according to the needs of companies and users without any emission fees, as provided by the company “Tripal”, these cards also facilitate online purchases and payments, in addition to providing more control and security for users against fraud and hacking.

It is worth noting that virtual credit cards are digital and temporary “MasterCard” cards that are used to facilitate payment on platforms and function like regular credit cards and provide guaranteed payments and save time, as you do not need money. -authorize or verify their validity.

Virtual credit cards are one of the payment options offered for the sake of simplicity. If someone chooses to pay online, they can do so using their preferred payment method and this payment is added to a virtual credit card that you can later debit as a regular credit card.

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