Dubai: The average monthly amount spend online by UAE residents in March increased to Dh1,479 compared, up from Dh1,375 a year ago, according to a report by Visa and the Department of Economic Development (DED) in Dubai.
The study found that majority (56 per cent) of the UAE consumers are now frequent online shoppers, making purchases at least once a week, compared with 39 per cent a year ago while one fifth (21 per cent) of respondents say they spend more than Dh2,000.
Neil Fernandes, head of risk at Visa Middle East and North Africa, said that the UAE’s e-commerce sector is seeing significant growth across nearly all categories and people are shopping significantly more frequently online.
Travel and entertainment, and utilities remain key categories while movie tickets (up 18 per cent), restaurant orders (up 17 per cent) and groceries (up 16 per cent) saw major growth over the last year. Government payments increased by 12 per cent pointing to the success of the UAE’s smart city initiatives.
Moreover, he said that cards continue to gain popularity over cash. About 68 per cent of respondents say they prefer using cards to make online payments, up 5 per cent from the 2016 study. Conversely, cash-on-delivery fell in popularity to 22 per cent (down 7 per cent).
Fernandes said that the high important for shoppers is to be secure when shopping online but the study found the more consumers use their cards, the more secure they feel.
Low payment card fraud
The study shows that 79 per cent of payment card users say they feel secure when paying online, compared to 37 per cent of non-users. While consumers are right to be alert when shopping online, the survey found the reported incidence of payment card fraud is actually relatively low at 14 per cent, broadly in the line with last year (15 per cent).
With consumers spending more online than ever before, he said that ensuring trust in the system is of paramount importance.
To overcome consumer concerns and to unlock the UAE’s full e-commerce potential, he said that Visa advocates a multi-layered security approach to tackling fraud, with the cardholder an integral part of the solution. Equally, there are a number of relatively simple steps merchants can take to build further confidence in the online shopping experience.
The study found that the number of infrequent shoppers, namely those making online purchases every two to three months or less, has halved in a year, from 20 per cent to 10 per cent in 2017. Approximately, a third of respondents (32 per cent) say a barrier to them paying by card online is that they want to see the product first-hand before making payment, while a 42 per cent choose cash on delivery because it assures product delivery.