As banks rush to increase payment methods, such as mobile wallet programmes, the majority of UAE residents are choosing paper over plastic.
In a survey of more than 1,000 residents conducted over the second quarter by the Dubai payment solutions provider Network International, cash was the top payment method for UAE residents in 10 out of 12 purchase categories from retail to education.
“Cash is clearly still king for UAE residents,” said Bhairav Trivedi, the chief executive of Network International.
“This is not a new trend, but it is certainly at odds with the UAE’s adoption of new technologies and drive to be a leader in innovation.”
Credit cards were the next most common form of payment followed by debit cards and other methods such as prepaid cards and cheques.
Over a fifth of those surveyed said they did not have a debit card and nearly 30 per cent were without a credit card.
Some businesses do not find it economical to implement a credit card facility.
Antonio Neto, the owner and managing partner of Abu Dhabi’s Captain Tony’s tour boats, said that establishing a system to accept bank cards would cost the company, which could later translate to higher prices for the customer.
He pointed to the increase in fuel prices that began at the beginning of the month.
“Despite this, we haven’t increased our prices and the way we can do that is to avoid paying commissions [for money transferred via cards],” Mr Neto said.
Nearly all of the company’s tours are booked with cash, and for large groups payment is made by a bank transfer.
“We aren’t a huge company doing thousands of transactions a day so it’s still pretty easy to take cases on an individual basis,” Mr Neto said. Yet this could be an opportunity for third parties offering the credit facilities instead. Mr Neto said his company had just closed a deal with Viator, a TripAdvisor unit operating online tour bookings. The deal helps Captain Tony’s reach customers from abroad who want to book in advance of their holiday.
While the prices to book a tour through Viator remain the same as directly booking through the Abu Dhabi company, Viator takes a 25 per cent commission while Captain Tony’s receives the remaining amount of money from the online booking.
And Mr Neto does not anticipate any change in the company’s payment system in the near future.
“We don’t have remote credit card facilities because it’s expensive, and we’d rather use that money for other things,” he said.
lgraves@thenational.ae
Follow The National's Business section on Twitter
