Payment methods

What types of payment methods can you use when shopping online?

There are several payments that you can use while shopping online. The most popular are bank cards, e-wallet, money transfer, direct debit, cryptocurrency, prepaid cards and buy now pay later.

E-commerce in the UAE was widely adopted by the tech-savvy population of the region before 2020, and then saw a dramatic recovery during the pandemic.

Consumer behavior in the UAE has changed based on the new reality in the region: online shopping during the lockdown was a necessity and the demand for contactless payments increased. Now a new standard, online shopping is essential and payment methods are many and varied.

A study by Statistica found that the four most common payment methods in the UAE in January 2020 were cards (39%), cash (20%), e-wallets (18%) and wire transfers (16 %). In June 2020, a Visa study in partnership with Dubai Economy and Dubai Police found that 49% of consumers in the UAE choose to shop using e-commerce platforms. Three in five people used cards or digital wallets to make more payments online, instead of cash on delivery.

The means of payment that can be used when buying online have been adapted to meet different user requirements: traditional debit and credit cards continue to dominate, digital wallets offer a seamless payment experience, and payout apps provide more flexibility.

How to start a business in Dubai

1. Debit and credit cards

Credit card have been around since the 1950s and are still going strong. Debit cards work much the same way, while promoting more responsible spending because they access readily available funds, rather than tapping into a line of credit. Cards are what many of us are used to and a proven method for both online and face to face transactions.

Pay with plastic is still the preferred payment method for UAE residents according to Statistica, with contactless card payment methods accounting for 84% of face-to-face transactions. Linking portable devices like Apple or Garmin watches has increased adoption, reducing the burden of carrying a physical card or having to pick it up when a cash on delivery item arrives at the door.

2. Digital wallet

Electronic wallets are becoming mainstream with the growth of e-commerce businesses, mobile commerce applications, and online payment services. Just as customers change their shopping experience to online platforms, they also transfer their cash balances to these digital wallets.

There are many e-wallet apps in the world, such as Google Pay, Samsung Pay, Pay it, and Apple Pay. These mobile wallets allow bank account holders to make online payments, store funds and check transaction history from anywhere at any time. Plus, the ability to make instant transfers, share bills with friends, make timely utility payments and more from a dynamic app on their smartphones.

3. Buy now, pay later

Additionally, some startups, especially in GCC, like Postpay, give customers the pleasure of shopping online without having to pay upfront. Bigger items aren’t up for grabs, so homes and cars aren’t an option, but indulgences that may not fit within budget are.

Rather than craving an item, or risking missing it in the time it takes to save it, customers can choose to pay for an item in two or four installments. Buying an essential item suddenly becomes much more feasible – without the high interest rates associated with a credit card.

Source link