How do people in the Middle East shop online and complete payments?

Online shopping and payment methods in the Middle East are distinctly localised, largely influenced by religious culture, financial infrastructure and mobile internet penetration. The following is a professional analysis:

I. Mainstream payment methods

  1. Credit/debit cards (but with lower penetration than in Europe and the US):
  • International cards: Visa/Mastercard mainly
  • Local card: Saudi SPAN, UAE KNET and other networks

  1. Cash payments (still important):
  • Cash on Delivery (COD) Cash on Delivery accounts for up to 35-60%
  • Convenience store cash top-ups (e.g. Careem Pay in the UAE)

  1. E-wallet:
  • STC Pay (owned by Saudi Telecom)
  • Beam Wallet (UAE)

Middle East online payment methods in detail (continued)

4. Localised e-wallets and mobile payments

The Middle East has seen a rapid growth of local e-wallets due to low credit card penetration and some consumers' scepticism about the security of online payments:

  • STC Pay (Saudi Arabia) - Launched by Saudi Telecom, it supports mobile number transfers, code payments and online shopping.
  • Mada Card (Saudi Arabia) - State-supported debit card network, widely used for government subsidy disbursement and daily consumption.
  • Beam Wallet (UAE) - Supports NFC near field payment, bill payment and e-commerce checkout.
  • Fawry (Egypt) - Allow users to pre-pay for e-commerce orders through offline outlets or apps.

5. Rise of Buy Now, Pay Later (BNPL) service

Interest-free instalments are extremely popular in the Middle East due to the "no interest" principle of Islamic finance:

  • Tamara (Saudi Arabia & UAE) - Offers 3 interest-free instalments in partnership with e-commerce companies such as Noon and Namshi.
  • Tabby (UAE lead) - Shopify partners with over 6,000 merchants, with 14-day payment delay or 0% interest over 4 instalments.

6. Bank Transfer & Direct Debit

Some platforms support real-time local bank transfers:

  • Saudi Arabia: SADAD system access to all major banks
  • UAE: BenefitPay, Apple Pay + local bank integration

Key challenges 🚨

  1. 📉 High COD rejection rate → Logistics costs spike (COD surcharge on platforms like Noon)
  2. 💳 Credit Card Fraud Risk → 3D Secure Forced Authentication Adds Friction
  3. ☪️ religious compliance → Islamic finance rules need to be met (e.g. interest-free instalments)

2024 Trend Forecast

✅ More cross-border platforms accessing Mada/SADAD to boost conversions
✅ BNPL penetration exceeds $3bn market size (Especially Sha&A)
✅ Super App integration for payments (e.g. Careem expanding from taxi to Pay+Shop)

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