United Arab Emirates (UAE) has experienced steady economic recovery in the last two years, resulting in resumption of many construction projects which had been stopped during the economic downturn. This has led to an influx of foreign labourers in the country, which in turn drove demand for prepaid cards such as payroll cards and remittance payment cards. With continuing economic recovery and preparations for World Expo 2020 underway, other prepaid card categories that we expect to post strong growth over the next five years include transport cards, gift cards, and general purpose reloadable cards.
In 2015, DubaiCard was launched for the residents of the emirate. The prepaid card allowed cardholders to make cashless payments both domestically and overseas, at stores and online, and also to withdraw cash from ATMs. DubaiCard is one of the first cards in the world that can be issued and activated instantly through Smart Kiosks. To ensure KYC compliance, the cardholder’s details are taken by scanning information from their Emirates identity card and passport through an electronic reader in the self-service kiosk. Funds can be loaded to the prepaid card while it is being encoded, personalized, and activated in the kiosk.
As millennials are driving prepaid card adoption across countries, card issuers in the UAE are focusing on designing prepaid cards in a more engaging and fun manner, using themes that interest the millennials.
Preparations for World Expo 2020 is expected to have resulted in creation of more than 250,000 jobs, many of which are being taken up by foreign workers. This is likely to increase demand for payroll cards in the region. Some card issuers are targeting the low wage foreign workers in UAE, who are typically unbanked and need to send money back to their home countries, and launching services that include ability to remit money directly from the payroll card, loading mobile phones directly from the card, and providing microcredit that is loaded onto a users’ payroll card.
Over the next five years, PayNXT360 expects more prepaid card issuers to enter the market as they aim to capitalize on this high growth potential market. This is expected to intensify the competition as well as compel card issuers to introduce innovative prepaid products in the market, to be able to differentiate their offerings and capture market share.
Want to gain deeper understanding of prepaid card dynamics in UAE?
Announcing the ‘Prepaid Cards Market Intelligence’ series – “UAE Prepaid Cards Business and Investment Opportunities – Market Size and Forecast (2011-2020), Targeting Strategies, Analysis of Business Trends, Consumer Attitude & Behaviour, Retail Spend, Market Risk, Competitive Landscape and Market Innovation”.
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