Research and Markets releases UAE Prepaid Card and Digital Wallet Business and Investment Opportunities Databook

Research and Markets, a leading source for international market research reports and market data, have released a new report titled “United Arab Emirates Prepaid Card and Digital Wallet Business and Investment Opportunities Databook – Market Size and Forecast, Consumer Attitude & Behaviour, Retail Spend – Q1 2023 Update”.

The digital payment ecosystem has been growing consistently in the UAE over the last few years. Innovative fintech firms along with a favorable regulatory environment have resulted in a growing adoption of prepaid payment instruments. In tandem with e-commerce growth, digital payment methods have emerged as the preferred payment choice for most in the Emirates.

With merchants racing to catch up with the tech-savvy population preferring prepaid payment instruments, the growth of the prepaid card industry is projected to further accelerate, as retailers continue to diversify their payment options for consumers. Overall, the publisher maintains a robust growth outlook for the prepaid card market in the UAE over the next three to four years.

Teen-focused prepaid card market has become a fertile ground for growth for fintech firms

Fintech firms are targeting teens in the Emirati market to capitalize on the growing shift towards digital payment services. These firms are launching mobile apps and prepaid cards to boost financial literacy among teenagers.

• In November 2022, Leap, a fintech startup firm, announced that the firm had launched its services in the Emirati market. The firm is providing kids with a prepaid card that is linked to their Leap account.
• In September 2022, Verity, another fintech firm targeting kids and teens, announced that the firm had launched its banking app in the Emirates. The firm, like Leap, also provides kids and teens with a mobile app and prepaid card to build their personal finance skills.

Amid the growing competition in the teen-focused prepaid card segment, firms are also raising funding rounds to scale and expand their presence in the region. For instance,

• In October 2022, Cashee, a UAE-based digital banking platform for teenagers, announced that the firm had raised US$3 million in a funding round. The fintech firm, which provides banking solutions and prepaid cards to teenagers, is planning to use the capital for expanding its presence in Saudi Arabia.

With many fintech firms looking to offer banking solutions to teens and kids in the region, the publisher expects the competition to further intensify over the next three to four years. This will also present buyout opportunities for larger players from the short to medium-term perspective.

Prepaid payment instrument providers are raising funding rounds to further accelerate their growth

The digital payment ecosystem is projected to record strong growth over the next three to four years in the UAE. To capitalize on this growth potential, prepaid payment instrument providers are raising fresh capital to accelerate their growth. For instance,

• In November 2022, Pyypl, a UAE-based fintech, and prepaid payment instrument provider announced that the firm had raised US$20 million in a Series B round, with a potential to further extended the round due to strong interest among investors. The firm is planning to use the fresh capital to further expand its mobile-based financial services platform.
• Since its Series A round, the firm claims to have grown at a significant rate, with the number of users increasing four times. Furthermore, the transaction volumes and revenues have also surged fourfold during the period. As of November 2022, the firm had raised a total of US$40 million, since its inception.

From the short to medium-term perspective, the firm is also expected to expand its operations across the Middle East and Africa region as it has already received authorization for three markets, and is preparing to enter an additional 12 markets.

Firms are forging strategic alliances to launch crypto prepaid cards in the United Arab Emirates

Cryptocurrency adoption has been growing consistently in the Emirati market and holders are seeking a simple way to redeem their investments. Consequently, cryptocurrency platforms are forging partnerships with payment providers, a trend that is evident around the world.

• In October 2022, BitOasis, the Dubai-based cryptocurrency platform, announced that the firm had collaborated with Mastercard to launch a crypto prepaid card for holders in the MENA region. The crypto card allows crypto holders to use their digital tokens at point-of-sale terminals and e-commerce marketplaces. These cards are expected to hit the market in early 2023 once the firm gets regulatory approval.

With a growing population of consumers investing in cryptocurrencies across the MENA region, the publisher expects significant demand for crypto cards, which will subsequently support the growth of the overall industry from the short to medium-term perspective.

According to the publisher, the prepaid card market (value terms) in United Arab Emirates increased at a CAGR of 9.2% during 2018-2022. Over the forecast period of 2023 to 2027, the market is expected to record a CAGR of 12.3%, increasing from US$5.66 billion in 2022 to reach US$10.30 billion by 2027.

This report provides a detailed data centric analysis of prepaid payment instruments, covering spend through prepaid cards and digital wallets across retail and corporate consumer segments. In addition, it provides a snapshot of consumer behaviour and retail spend dynamics in United Arab Emirates. With over 100 KPIs at country level, this report provides comprehensive understanding of prepaid card and digital wallet card market dynamics.

• Market dynamics: Provides a comprehensive view on size and structure, industry dynamics, market trends, consumer attitude and behaviour, and competitive landscape in prepaid card and digital wallet industry in United Arab Emirates.
• Digital wallet segments: Provides value, volume and average value per transaction across 5 key spend categories in digital wallet. This includes retail, travel, entertainment and gaming, restaurant, and recharge and bill payment.
• Open loop and closed loop prepaid cards: market estimates and forecasts to assess opportunities 13 open loop and closed loop prepaid market segments. Details four essential KPIs – number of cards in circulation, number of transactions, load value, and value of transactions.
• Consumer attitude and behaviour: Drawing from proprietary survey results, this report identifies and interprets key prepaid KPIs, including spend by age, gender, and income level.
• Retail spend: Breaks down retail spend across 11 categories to provide detailed insights on consumer behaviour and changing dynamics of prepaid card spend.

Scope

The report provides a detailed data centric analysis of prepaid payment instruments, covering spend through prepaid cards and digital wallets across retail and corporate consumer segments. In addition, it provides a snapshot of consumer behaviour and retail spend dynamics in United Arab Emirates. With over 100 KPIs at country level, this report provides comprehensive understanding of prepaid card and digital wallet card market dynamics.