Dubai: Ecommerce readiness in the UAE is very high, yet the country has a long way to go to match the global level of e-shopping penetration said a senior executive from CyberSource, a wholly-owned subsidiary of Visa Inc.

“Smart phone penetration rate in the UAE is among the highest in the world at 73.8 per cent. This means, there has never been a more important time for merchants to expand into e-shopping to meet the rapidly changing lifestyles and needs of their customers,” said Gups Jutla, Head of Business Development, CyberSource Middle East.

The UAE’s e-shopper population is estimated at three million, this equates to approximately 30 per cent of the total population of the country. Despite such low penetration levels, the country accounts for 55 per cent of total GCC e-commerce spend.

The country’s retail sales last year was estimated at $160 billion (Dh587 billion). Out of this, ecommerce spend accounted for about $2.8 billion and the average spend per internet shopper was reported at $950. “These numbers point to the huge scope for drawing more customers on to ecommerce platforms,” said Jutla.

According to a recent study commissioned by Visa, the Middle East and North Africa region witnessed an estimated 45 per cent year-on-year increase in sales from $10 billion in 2011 to $15 billion in 2012, making it the fastest growing e-commerce region worldwide.

According to the study, e-commerce transactions across the region reached $15 billion, a rise from the $10 billion concluded the year before. Egypt came first in the entire region in e-sales in 2011 with $3.2 billion while the UAE was next with $2.8 billion in e-sales.

“Although the UAE has excellent basic ecommerce infrastructure, factors such as security fears, the mall culture cash driven retail shopping and relatively under developed delivery logistics are hampering the growth in ecommerce,”said Jutla.

While e-payment enablers and infrastructure providers have begun to address these concerns, many in the industry say merchants need to do more to get more people to do shopping online.

“Online shopping malls can address a lot of these challenges, especially concerns relating to quality of products, delivery mechanisms and payment security,” said Ayaz Maqbool, managing director of Tejuri.com, the region’s first online shopping mall.