Today's Edition
RABI HAMAMSAH (ABU DHABI)
The UAE government is moving steadily towards establishing a strong digital economy and benefiting from the great advantages that result from the digital transformation process to become a cashless society, with electronic payments now constituting a substantial portion of transaction value in the country. The UAE is considered one of the most advanced countries in the field of information technology and adopting modern technologies to serve the economy, as it is one of the countries that most uses smart phones in the world.
In 2023, electronic transactions accounted for over 37% of all transactions in the UAE and represented the vast majority 78% of the total transaction value, according to ACI Worldwide’s 2024 Prime Time for Real-Time report, which highlights this rapid progress.
The strategic plans of the national economy depend mainly on the digital economy, as it contributes to creating real opportunities for foreign direct investment. The country is implementing plans to strengthen the digital economy by adopting the UAE Strategy for the Fourth Industrial Revolution, as one of its goals is to enhance digital security, which is achieved by adopting digital economy policies and digital transaction technologies “Blockchain” in financial services and transactions.
The increase in electronic payments shows the UAE is heading towards a cashless economy. The ACI report noted that cash-based transactions will decrease to 20% of the total transaction value in the UAE by 2028. The report also added that the UAE achieved a remarkable 53% year-over-year growth in real-time payment transactions.
In a statement sent to Aletihad, Santhosh Rao, Senior Vice President of Sales at ACI Worldwide MEASA, underscored the transformative impact of real-time payments on the UAE's economy.
“Real-time payments eliminate payment friction, inject greater liquidity into the system, and promote economic growth and financial inclusion,” he said.
According to the report, the UAE Instant Payment Platform (IPP) scheme accelerated the growth of real-time payments in the UAE. This government’s scheme aims to enhance the efficiency and accessibility of payment systems across the nation.
In his statement, Rao highlighted the importance of collaboration in fostering a successful real-time payment ecosystem.
“Active collaboration is the cornerstone of a thriving real-time payment ecosystem, fostering an environment where banks must navigate a delicate balance of competition and cooperation with emerging market players. The world's most successful real-time payment schemes, exemplified by India's achievements, showcase a myriad of real-time payment methods via QR codes, mobile apps, or online accounts, pushing the boundaries of innovative use cases,” he noted.
The successful implementation of the UAE IPP scheme demonstrates the country's commitment to leveraging technology for economic development and financial inclusion.
