Digital Payments User Growth in the Middle East by the Numbers: Market Opportunities and Future Trends

Introduction: the rise of digital payments in the Middle East

The digital payments market in the Middle East has shown explosive growth in recent years. With increased smartphone penetration, improved internet infrastructure and a growing proportion of young people, the region is experiencing an unprecedented fintech revolution. This article will analyse the latest statistics in depth to reveal the key factors driving this growth and explore future trends.

I. Statistics on the Size of Digital Payment Users in the Middle East in 2023

According to the latest industry report, the total number of active digital payment users in the Middle East has reached 125 million in 2023, a year-on-year growth of 28.61 TP3T from 2022. with the Gulf Cooperation Council (GCC) countries performing particularly well:

• Saudi Arabia: 32 million active users (growth rate 34%)
• UAE: 18 million active users (growth rate 29%)
• Egypt: 28 million active users as representative country of North Africa (growth rate 25%)

Notably, Qatar and Kuwait, while smaller in absolute numbers (4.5 million and 3.8 million, respectively), are both growing at rates in excess of 30%, demonstrating strong market potential.

II. Analysis of the five key factors driving growth

1. Government policy support and vision for a cashless society

Several Middle Eastern countries have made the development of the digital economy a national strategic priority. Examples include:

• Saudi Arabia's "Vision 2030" explicitly proposes to increase the proportion of non-cash transactions to 70%
• UAE launches 'Cashless Dubai' programme
• Bahrain establishes open fintech regulatory sandbox environment

These policies not only provide institutional safeguards for the development of the industry, but also incentivise corporate innovation through tax incentives and other means.

2. Continuing shift in consumption habits after the epidemic

The COVID-19 pandemic has accelerated consumer acceptance of contactless payments:

• Online shopping penetrationJumps from 121 TP3T in 2019 to 381 TP3T in 2023
• QR code payment transaction volumeA 17-fold increase in three years

3. Rapid improvement of fintech infrastructure

The Middle East region has made significant progress in the development of payment infrastructure in recent years:

• Popularisation of real-time payment systems: National instant clearing networks such as SIPS in Saudi Arabia and UAEFTS in the UAE have covered more than 90% bank accounts
• Digital wallet penetrationGrowing from 181 TP3T in 2020 to 531 TP3T in 2023
• Number of POS terminalsDoubled in the last three years to 15 units per 1,000 population

Particularly noteworthy is the significant improvement in the efficiency of cross-border payments. the processing time for cross-border transactions between GCC countries realised through the Buna platform has been reduced to the order of minutes from the previous 2-3 days.

4. Young demographics and rising consumption power

The unique demographics of the Middle East provide a natural advantage for digital payments development:

Source: World Bank Statistics 2023

The younger generation is significantly more receptive to mobile payments than the traditional population:

• Users aged 18-24S87% Use digital payments at least once a week
• Users over 35 years of ageThis proportion is only 49%

At the same time, rising disposable incomes are driving the trend towards consumer electronics.

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5. Localised adaptation of innovative business models
- Explosive growth of BNPL services in the Middle East
- How "super apps" can integrate payment scenarios

III. Analysis of differences in market segment performance

1. Comparative characteristics of the GCC countries and the North African market
2. Blue Ocean Opportunity for B2B Enterprise Payments

IV. Challenges and bottleneck breakthroughs
1. Examples of regulatory harmonisation problems and solutions

V. Growth forecasts and investment recommendations for the next three years