Five years ago, a shopper feared only two things when making an online purchase: getting the wrong item and the security of the transaction.
Today, the only worry that most shoppers will have is getting the wrong-sized garment when they order online, experts say.
Confidence when shopping online has soared in recent years in the UAE and the GCC, especially as e-commerce giants have taken steps in collaboration with banks to ensure that all transactions are verified and properly tracked to credible vendors. Experts at Seamless Middle East 2017 provided an insight on e-commerce in the region, and how going cashless is now easier than ever.
Waqas Mirza, chief marketing officer at Avanza Solutions, noted that the adoption of plastic as a payment option is “huge” now because of the security issues getting addressed.
“These include one-time passwords and all the other bells and whistles that banks have put into place to ensure that if your card has been compromised, then there is another means of authentication that will prevent criminals from making a purchase,” he said. “I think that people who use e-commerce are understanding this focus on security, and the reluctance to use credit cards on the Internet is going away now.”
He added: “There was a segment of products that people would normally buy online such as air tickets or they would pay their bills online. However, a lot of commodities have come online today such as electronics. So the adoption from the consumer side is huge because there are a lot of items that are on offer from the merchant’s side. However, there is still a lot of room for growth.”
Asked about how the landscape can be improved, he said that the products basket available to shoppers needs to grow, and that e-commerce companies needed to work on their delivery times. Consumers today are eager to get their hands on a product as soon as possible, and lament that fact that same day deliveries are still not an option that is available to them, he revealed.
Asked what will be the dominant trend in the coming years, he pointed to mobile wallets. “Instant payments and transfers will only grow in popularity in the coming years.”
Eric Claudel, senior vice-president of banking and payment for the Cismea region at Gemalto, revealed that the behaviours of consumers in the Middle East is following a pattern that is the norm in the US and Europe, where the shift to e-commerce is growing tremendously. He revealed that 74 per cent of people in the region are doing their shopping online as of this moment. “However, we have seen an increasing fear in consumers regarding the safety of their personal details when they shop online.”
Banks, he said, have picked up on this fear and are increasingly launching new measure that will prevent hackers from gaining access to private data. “There is really a need for the banks to come up with more secure and robust solutions for online shopping and e-commerce… it is always a race to stay one step ahead of hackers today. You need to constantly invest in new technologies that will ensure that your data remains safe,” he said.
“What we need to do is bring in biometrics such as fingerprinting and face recognition that will act as instant security measure,” he stressed, adding that such technologies are already being put to use. “We predict that they will be more commonplace in the coming years. People will be able to use profile recognition, iris scanning and fingerprinting through the device of their choice such as their smartphones and tablets.”
In the UAE today, 16 per cent of the banks are using biometric fingerprinting. Gemalto expects this number to grow to 88 per cent in five years time. Facial recognition will also be adopted by 67 per cent of banks in five years time.
Technology in the UAE
When it comes to the GCC region, the UAE is the leading market in the region in terms of new product launches.
“This is the market where the latest technologies and solutions are launched,” says ضzgür ضzvardar, Verifone’s vice-president and general manager in the Middle East and North Africa. “Globally, debit cards are still preferred over credit cards; however, cash is still king in the payments industry. What we have seen is that the adoption of credit cards is on the rise as people get more comfortable with using them; and they become more aware of the benefits that they can get from using them.”
A lot of banks, he said, are also promoting credit cards through rewards programmes and easy installment packages. This is driving consumers towards electronic payments instead of cash.
“New technology attracts new people; some consumers take to one form of payment more than others. Contactless payments, in all shapes, is the dominant trend in the market right now. All the banks in the region are updating their portfolio to include contactless payment options, which have been specifically requested by consumers that are aware of the technology. It’s not a new technology, by any means, but it is one that has seen the most growth in recent years,” he said.