Jatin Gupta laughs at the memory of transferring money to India just a few years ago. He remembers how he would first withdraw cash from an ATM, then join a queue at an exchange house at a mall in Doha, where he worked at the time.
There, he would fill out a form, present his identification documents, discuss exchange rates with the cashier and hand over his precious riyals, plus an extra transfer fee. A couple of stressful days followed until the money was credited to his account in India.
“Now, I just use my bank’s app and the money is credited at the other end within a few seconds,” Mr Gupta says.
Mr Gupta now lives in Dubai and works within the financial services industry. In his experience, exchange houses often have better rates than banks – and these are often negotiable, depending on the amount being transferred.
“With the bank app, I may receive a slightly lower exchange rate and have to accept the price offered, but the convenience is worth the difference.”
Speed and accessibility may be behind the expanding market for payment apps – although, as with all things digital, coronavirus-related movement restrictions and safety concerns have accelerated the trend.
In total, finance apps have been downloaded a 4.7 billion times between the first quarter of 2019 and the first quarter of 2021, according to a June report by marketing analytics platform AppsFlyer.
Finance app downloads in the UAE increased 55 per cent over the first three months of 2021, compared with same period in 2020, while downloads in Saudi Arabia rose 73 per cent. Payment, banking and investment apps have led the trend.
“There has been an overwhelming response to financial applications since the pandemic,” says Sagar Chandiramani, chief growth officer at WorkerAppz, an international remittance and payments platform aimed at businesses and individual customers around the world.
The Canada-licensed start-up, founded by long-time remittance professionals from the UAE, has a network covering more than 100 countries. The platform is currently available to business customers in Bahrain, Jordan, Europe and the Far East, and is expected to be available to consumers in the UAE by the end of the year, Mr Chandiramani says.
“Activity within the sector has been driven by the high valuations that FinTechs command, so you have a wide range of entrepreneurs entering the market, from industry veterans such as ourselves to people looking to take advantage of the wave,” he says.
“Regulators in the UAE have, rightly, been very careful to issue licences.”
Across the region, whether it is remittances or investments, new apps are appearing in online marketplaces on a regular basis – each with a specific value proposition. Some, such as Rise, YAP and NOW Money, partner with existing banks to offer specific services. Others aim to build all-digital banks, such as the UAE's Zand, which was launched this year and caters to retail and corporate clients.
While banking apps may offer the safety of an established brand, consumers must stay alert to security and privacy features before sending any money via an app.
“Whether financial or other consumer apps are running on a mobile smartphone or on your laptop computer, there are inherent privacy and security risks when conducting online transactions,” says Mark Pelkoski, vice president of sales engineering at Virsec, a software security company protecting enterprise applications from cyber attacks.
Credentials theft is one of the most common cyber crimes, where an attacker steals usernames and passwords and sells them on to scammers. Clicking a malicious link within an app or website can infect your system and capture everything you have been doing, from email to financial transactions, he says.
Users can protect their privacy and security with basic steps such as using complex passwords, enabling two-factor authentication, only downloading apps from verified app stores, and making use of antivirus software.
Although the UAE FinTech market is still maturing, here are some of best payment apps available in the UAE app stores to help you make transfers, split bills or pay for government services.
Apps for local money transfers
The UAE does not yet have a widely used peer-to-peer, or P2P, payment app, such as Venmo in the US or Tikkie in the Netherlands. Several start-ups have been launched within the country, with varying levels of operations – partly as they wait to comply with local regulations.
One of the furthest along is Mamo, which was granted an Innovation Testing Licence to operate under specific conditions from the Dubai International Financial Centre in July.
However, the best app for local money transfers remains your bank. Most local banks in the UAE – and across the region – offer transfers within the country, although there are a few late adopters.
Fees are generally Dh1 per transaction, depending on the type of account. It is worth evaluating the pros and cons before picking a bank.
Emirates NBD’s mePay service, for instance, has enabled customers to make local transfers to anyone in the UAE using only the recipient’s mobile number since 2016. Mashreq, Abu Dhabi Islamic Bank and First Abu Dhabi Bank offer similar services, but not all UAE banks have the same level of online banking amenities.
Apps for international money transfers
Opinions were split when The National asked UAE residents which apps they prefer to use when sending money abroad. Several residents use their bank’s mobile app because of corresponding banking relationships in other countries, particularly India, and for the sheer convenience of having everything in one place.
UAE banks generally charge from Dh25 a transfer but the exchange rate offered to you in the app could differ from live market rates by Dh10 or more.
However, when sending money to India, for example, exchange rate differences can result in beneficiaries losing up to Rs200 ($2.74) or more, one Dubai resident told The National.
In terms of privacy and security, banks are considered to be the safest option – but a well-known brand is also a target for cyber criminals.
One of the most popular third-party apps is Wise, formerly known as TransferWise. Launched in 2010, the UK-based FinTech offers 1,600 currency rates to a user base of more than 7 million and processes more than $5 billion in customer payments each month.
The app has a digital wallet feature that allows you to hold different currencies and convert them when it is convenient or when rates are low. The app usually aligns with live exchange rates.
However, as of December last year, UAE residents can only make Wise transfers from debit or credit cards, adding an extra 2.5 per cent to 4 per cent in transaction fees.
Apps from exchange houses form a third category of transfer solutions. Several UAE brands, such as Al Ansari Exchange and MoneyGram, offer instant money transfers across the globe using wire operators such as Western Union.
When we considered sending Dh1,000 to France on a few different apps, the total amount payable differed from the live exchange rate by up to Dh8.66. Fees range from Dh15 to Dh20, but factor in the exchange rate difference and you could see a difference of Dh70 on a ticket size of Dh1,000.
Apps for splitting the bill
Payments can become awkward when other people are involved. The solution is to download Splitwise, a free app that tracks shared expenses so that everyone is reimbursed – whether brunch bills, holiday costs or rent. A UAE-grown app is Wally, which also doubles up as a budgeting app, allowing you to – literally – save the receipts by photographing them. Both apps are free of charge. Sadly, neither has an inbuilt money transfer option, so you will need to settle those bills in other ways.
Apps for purchases
The UAE was one of the first countries in the region to set up contactless payments when Apple Pay debuted in 2017. Together with Samsung Pay and Google Pay, it is one of the most popular wallets with UAE residents, data from the comparison platform SimilarWeb shows. The wallets are free to use and run off a personal debit or credit card. All offer built-in security features to help protect your transactions.
When it comes to online purchases, PayPal is a viable option because many smaller merchants in overseas markets prefer it. Again, it is usually linked to your credit or debit card.
Klip, which was developed by Emirates Digital Wallet, was launched last year and aims to process instant cashless digital payments directly from their bank account or from value stored in the digital wallet. A mobile app has been announced that will allow residents and visitors to the UAE to make digital payments regardless of whether they have a bank account or not.
Apps for government services
You can pay for utilities using your bank app but several platforms process payments across UAE public sector entities. As the UAE aims to align itself with the smart government trend, government apps are increasingly becoming the single point of contact for residents.
The DubaiNow app offers access to more than 120 city services from more than 30 government and private sector entities in Dubai. You can use it to pay telephone and utility bills, recharge Salik and Nol accounts, settle traffic fines, apply for residency permits and donate money to charity, in addition to paying for health care, education and other civic services.
For those living in Abu Dhabi, the Tamm app functions in similar fashion, connecting residents to the police, municipality, water and electricity services, port authorities and the emirate’s economic, education and health departments. As of March, the government integrated the PayBy payment service into the app, enabling contactless payments without the need for a credit or debit card.
Both apps offer the same level of safety and privacy as other government departments.