Recent research has found out that Alternative Payment Methods will account for 59% of all online transactions by 2018. With increasing complexities in the global market with regards to payments, it is imperative for economies to allow alternative payment methods which instill that confidence in consumers to pay online. Because the truth is that, as much as the security of payments gateways have improved over the years, there are sections of consumers who still aren’t comfortable in using their cards online.
As a testimony to having a secured alternative payment option, Saudi Arabia has taken the lead and introduced an online payment system known as SADAD, which is a payment system established by the Saudi Monetary Agency. It is designed to be the kingdom’s national electronic bill presentment and payment service. The system links commercial services to local banks, streamlining bill payment transactions for the end consumer as well as the collecting party, through all banking channels 24*7. With SADAD, consumers can shop online, pay utility bills, pay for travel booking, pay for government services, tuition fees, etc…
In recent times, the Saudi E-Commerce landscape has grown significantly, amplified by the consumer’s high purchasing power and growth, thereby sparking off considerable activity in the online payments space, which is not surprising considering Saudi Arabians have the most number of Credit and Debit Cards, amounting to 12.3 million. However, interestingly, 76% of all payments are done through cash on delivery and 24% are made through cards. Moreover, the e-commerce industry is projected to grow to $10.8 Billion by 2020.
As one can make out, Saudi Arabia is positioned in a sweet spot when it comes to online payments and e-commerce, aided by strong government backing & a growing venture funding landscape.