209 million more customers in MENAP have begun shopping online since the start of the pandemic, finds report

209 million more customers in MENAP have begun shopping online since the start of the pandemic, finds report 

By: Abu Dhabi SME Hub

Checkout.com launches MENAP Payments report, with 13000 consumers surveyed in the largest report of its kind.

Global payment solutions provider, Checkout.com, has launched its annual MENAP Payments report. As consumer demand for digital commerce continues to surge, ‘Digital Transformation in MENA and Pakistan: Why Payments are key to unlocking more growth and opportunity’ highlights the development of the region’s e-commerce and fintech sectors in the past twelve months, and demonstrates the growth opportunity for merchants in this maturing market. 

The report notes exponential growth in the e-commerce market throughout MENAP year on year. In 2020, 47 per cent of consumers said that they expected to shop online more frequently over the next year. In 2021, approximately 83 per cent say that they’ll maintain or even increase their current level of e-commerce spending into 2022, suggesting an irrevocable shift in consumer behaviour. 

This shift has been especially pervasive for the convenience economy, with everyday items such as food delivery, groceries, and household goods firm favourites. The report also finds an increase in the frequency of online shopping amongst consumers, with nearly half (45 per cent) of those surveyed saying they shop online at least once a month. Moreover, 53 per cent say that they are doing more of their shopping online now compared with before the COVID-19 pandemic started. In peak seasons like Ramadan, online shopping also spikes. Earlier this year, 76 per cent of consumers in the UAE and Saudi Arabia said that they anticipated purchasing products and services online more frequently during Ramadan.

This rise in digital commerce has been matched by greater sophistication in the region’s digital payments ecosystem. Payment methods such as cash-on-delivery and bank transfers have once again seen a decrease year-on-year. Instead, 60 per cent of consumers in the region now prefer to pay for e-commerce via a digital payment method – a 20 per cent increase since Checkout.com’s 2020 report. 

This is also giving way to newer methods of paying, including digital wallets, in-app social shopping, and buy now pay later (BNPL) options. Checkout.com’s global data in 2021 suggests that the MENAP region is actually outpacing regions such as Europe and APAC for the adoption of in-app social shopping and BNPL. Today, three in four (76 per cent) consumers in the region report using some form of fintech app in the past year, with 81 per cent feeling they directly benefit from the growing fintech sector.

“A flourishing digital payments and e-commerce ecosystem is leading consumers to feel more empowered, with start-ups thriving in the fintech arena, and commercial markets opening up,” notes Mo Ali Yusuf, Regional Manager for MENAP at Checkout.com. 

Another sign of the region’s maturing e-commerce and digital payment industries is a sustained increase in cross-border commerce. Merchants who offer both international payment channels and popular local payment methods are enabling countries in the region to contribute to global value chains more effectively, according to the report. Approximately 85 per cent of consumers in the region have made online purchases from brands and retailers outside of their home country in the past 12 months, with a third (33 per cent) citing cross-border shopping as their number one reason for shopping online. This year’s report further predicts that over 80 per cent of large European enterprise merchants will be selling into the MENAP region by 2023. 

Yusuf continues: “For the first time, our data shows us that MENAP has begun to outperform European markets in the adoption of emerging payment methods. This presents a phenomenal opportunity for global and domestic merchants to expand their businesses across MENA. We are proud to continue supporting this ecosystem to thrive, in what we forecast to be another year of exponential growth across the region.” 

Leading voices within the region’s business community add perspective to these issues as part of this year’s Checkout.com report. Case studies and issues-based opinions are featured from organizations such as Careem, OSN, Fawry, Tamara, the MENA Fintech Association, Visa and others, underscoring the importance of creative collaborations in advancing digital commerce.

You might also like