Discover how GlobalData predicts a 14% growth in the Saudi Arabian card payments market to SAR 532.1 billion ($141.9 billion) in 2023, driven by the government’s cashless society initiatives and consumer preference for electronic and contactless payments.
GlobalData, an analytics company, anticipates that the Saudi Arabia card payments market will experience growth in 2023. This development is due to consumer preference for electronic currency payments and the Kingdom’s cashless society efforts.
GlobalData expects the Saudi card payments industry to expand 14% to SAR 532.1 billion ($141.9 billion) in 2023. The government’s push for a cashless society, customers’ preference for electronic payments, and contactless payments will boost growth.
Saudi Arabia’s use of card payments is growing rapidly
In 2021 and 2022, respectively, Saudi Arabia’s card payment value climbed by 30% and 17%, according to a report from GlobaData, as a result of strengthening economic conditions and a rise in consumer expenditure.
Although cash has traditionally been the most popular form of payment in Saudi Arabia, usage is dwindling. According to GlobalData, this tendency was primarily noticeable during the Covid-19 pandemic period, when banks and retailers urged customers to switch to electronic payments to slow the transmission of the virus.
In accordance with the nation’s Vision 2030, the Kingdom also wants to limit the use of cash payments. The primary payments infrastructure provider for Saudi Arabia, Saudi Payments, announced that 95% of all POS transactions were cashless in 2021.
According to GlobalData’s Lead Banking and Payments Analyst Ravi Sharma, the trend might persist. The Saudi Arabian card payments sector is predicted to expand by 10% between 2023 and 2027 to SAR785 billion ($209 billion).
The Kingdom Prefers Debit Cards Most
Notably, Saudi Arabians favor debit cards over other bank cards since they want to avoid debt. Debit card payments made up roughly 90% of all card payments in the nation in 2022, according to Saudi Payments.
Saudi Arabia is one of the nations looking into the feasibility of a central bank digital currency (CBDC) in addition to card payments. According to reports, the Kingdom is concentrating on domestic CBDC use cases, prospective partnerships with regional banks, and fintech companies.
In order to evaluate the advantages of decentralized payments technology, Saudi Arabia worked with the Central Bank of the UAE on an exercise named “Project Aber” in 2019. The project specifically attempts to use distributed ledger technology for bond settlements.