Credit cards are becoming safer, greener, and community-centric while increasing their user base. We swipe key trends for this year and the next.
Mobile payments: Experts say that mobile payments will get bigger and better. Research firm Gartner expects mobile payment transactions worldwide to catapult to nearly 4.5 billion next year.
Recently Etisalat and MasterCard joined forces, along with Research in Motion, to launch payments empowered by Near Field Communication (NFC) technology. Essa Al Haddad, Etisalat Group Chief Marketing Officer, says, "The NFC technology used in this application allows a tremendous shift in how we will start to make payments, something that has been talked about for years will soon become a reality. Your mobile could buy you lunch, a cinema ticket, transport, and much more."
Consumers can link their PayPass-enabled credit, debit or prepaid MasterCard accounts to their mobile phones to fund mobile-initiated payments.
Ram Chari, CEO of Network International, a card solutions provider, says, "Contactless payments represent a new generation in payment technology. Driven by NFC-enabled mobile phones, this technology will witness increasing penetration in the next couple of years."
Commercial cards: Commercial cards have been among the fastest-growing card products in the world. The region is seeing more of these combined with value-added partnerships.
November saw Visa and Bank Al Etihad of Jordan join forces to offer the new Visa Business Card for small and medium enterprises to assist them in meeting their working capital needs and monitoring and tracking their business expenses such as travel, entertainment and stationery. These cards reduce the costs incurred by businesses and government for cheque production and reconciliation, travel advances to employees, purchase order processing, and other expensive paper-based practices.
Partnerships in general were on a high this year and will pave the way for better shopping next year. Following a tie-up with Joyalukkas, customers using RAK Bank's debit, credit or prepaid cards are offered a complimentary pearl necklace and earring set with their diamond jewellery purchases.
Prepaid cards: Last year saw an explosion in prepaid credit cards in the US and Western Europe. The fee-based offering provides the functionality and flexibility of a globally accepted credit card. Plus, these are interest-free and Sharia-compliant.
Statistics say such cards already account for 10 per cent of all credit card expenditure in countries such as the US.
Companies introducing prepaid cards in the region say that they are uniquely suited to the needs of expatriates who may be excluded from traditional cards.
In November, the world's first airport prepaid card was launched in Dubai by Dubai Airports, Dubai Duty Free and MasterCard Worldwide. DXB Connect, issued by the Abu Dhabi Commercial Bank in conjunction with Jade Payments and Global Processing Services, provides discounts at the duty-free retail outlets as well as hotels, spas, F&B outlets and entertainment venues across Dubai.
The prepaid card comes loaded with an Etisalat SIM card as well. "Our goal is to continually find innovative ways to create a uniquely positive and memorable service experience for our passengers," says Paul Griffiths, CEO, Dubai Airports.
Online solutions: Online solutions are the future of credit cards. In November, eNett International's vNett virtual card solution became dirham-friendly. A Travelport joint venture, eNett International provides travel agencies with a 16-digit MasterCard virtual account number for a specific transaction or set of transactions. Managing Director and CEO of eNett International Anthony Hynes says, "The addition of the UAE dirham to the growing number of currencies available in the virtual card platform is an important development for the travel industry in the Middle East."
The online world is becoming increasingly competitive. Square, a credit card reader app, has added loyalty rewards and cash payments to its portfolio.Started by Twitter co-founder Jack Dorsey in 2010, Square has announced that it transacts $11 million (Dh40.3 million) per day in mobile payments.Square allows merchants to reward its regulars by allowing them to define what makes a Card Case (its companion wireless payment app) customer a regular. It charges a 2.75 per cent fee per swipe for all credit cards.
Biodegradable cards: As environment becomes a key concern, credit cards companies are looking at options other than plastic.
Loyal customers are safer and more predictable, which allows credit card companies to present focused marketing campaigns. GEMS Education, National Bank of Abu Dhabi and MasterCard recently got together to offer parents discounts and benefits, extendable to children above a certain age under the discretion of parents.
Eyad Al Kourdi, Vice-President and UAE Country Manager, MasterCard Worldwide, said that the card would "complement the lifestyle needs of parents while creating further awareness of financial products and services."
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Prepaid card in honour of the UAE
Prepaid cards are on the rise in the UAE as they safely allow card companies to expand their consumer base. In a shining example, encapsulating key trends this year is the Sharjah Islamic Bank's new card celebrating the 40th UAE National Day. The prepaid card issued in collaboration with MasterCard features a special design commemorating the occasion.
Eyad Al Kourdi, Vice-President and UAE Country Manager, MasterCard Worldwide, says, "The card offers financial access even to people who do not have a bank account, allowing them to track their spending and manage their finances with security and convenience."
The cards are available to all UAE nationals and expats starting from 14 years of age, and can also be shared as gifts to anyone.
— S.S.
