All you need to know about digital wallets in the UAE

From what they are to how they work and which options are available in the Emirates, read our comprehensive guide

Illustration by Alvaro Sanmarti
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Local banks and telecommunications companies are forging ahead with digital wallets even as, according to the UAE Central Bank, the country remains a 75 per cent cash-based economy. But will they be able to replace the nation’s love for cold, hard cash?

Cashless payments have been identified as a top government priority in the UAE’s Vision 2021 and, last year, 38.6 million cashless transaction were made by e-dirham, the UAE Ministry of Finance says.

But how does this relate to our everyday spending: whether we withdraw another hard-to-break Dh500 note from the ATM or, instead, swipe our phone to pay for that meal out?

Despite the focus on cash, the UAE’s young and “digital-minded” population, deep smartphone penetration and government smart economy drive make it a “perfect storm” for increased mobile wallet adoption, says Paul Clarke, head of product and innovation at regional payment solutions provider Network International.

So how do digital wallets work? Read our guide to find out.

What is a digital wallet?

Also known as an electronic, mobile or e-wallet, this is simply an electronic device that allows an individual to make electronic transactions - usually using a smartphone and normally linking either a bank account or credit card to the wallet.

How does it work?

First, the technology: digital wallets generally use ‘near-field communications’ (NFC), a method of wireless data transfer, to allow contactless payments from phones in extremely close proximity - usually a few centimetres. Samsung also uses a patented Magnetic Secure Transmission (MST) to replicate a card swipe by wirelessly transmitted magnetic waves from a Samsung device to a card reader.

To install and use a digital wallet, you will need to download your app of choice from the iTunes or Google Play stores and link it to your credit or debit card - then it is as simple as unlocking the phone and waving it near a merchant’s terminal to make a purchase. Payments below Dh100 do not require a PIN, says Suvo Sarkar, Emirates NBD’s senior executive vice president and group head for retail banking and wealth management - just unlock of phone using a passcode or biometrics such as your fingerprint or iris scan.

What digital wallets can I use in the UAE?

You can use the Emirates NBD Pay or MashreqPay wallets from the local banks, as well as the Etisalat Wallet and the Beam wallet, used by 350,000 people and offering dirham rewards for making mobile payments. The biggest arrival to date is Samsung Pay, which was rolled out in the UAE earlier this year.

Are any other digital wallets on the way?

Apple Pay is due to enter the market by the end of the year, according to Apple’s third-quarter earnings call - the first country in the region. The imminent game-changer is expected to be the Emirates Digital Wallet, a project led by the UAE Banks Federation and with 16 banks involved. The UBF says it will create “a society-wide cash transformation to digital” as part of the country’s digital economy initiative.

Where can I use digital wallets to pay?

You can pay via phone in-store at over half of the country’s 100,000 terminals, says Mr Sarkar of Emirates NBD. Gaurang Shah, Mastercard’s regional digital payments lead, says most grocery stores, coffee shops and fast food restaurants in the UAE accept mobile payments - as well as anywhere in the world supporting NFC. You can even buy phone airtime, pay school fees or buy a ticket to go to the top of the Burj Khalifa using a digital wallet, he says.

Why should I choose a digital wallet over cash?

Cash payments can take “whole minutes” to complete in-store, says Sirish Kumar, chief executive and co-founder of e-payment solution, whereas mobile wallet payments are “tap and go”. So your e-wallet could really reduce queuing time; a report by UK supermarket app Ubamarket found that three-quarters of shoppers abandoned their shopping and left a store rather than wait to check out. It also makes for a “seamless experience” across loyalty cards, vouchers and delivery from online purchases, he says.

What’s in it for merchants?

There is a reduced cost of handling cash, says Mr Kumar, and improved customer experience and dwell time at check-out - plus it is easier to track the customer experience across all channels. For governments, too, there are tangible benefits: improved financial accessibility and fiscal oversight of the economy.


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How do I choose a digital wallet?

Not all wallets are “created equal”, says Hadi Raad, Visa’s head of digital solutions for central and eastern Europe, Middle East and Africa. “A lot of them are ‘closed loop’, which means they do not interact with other payment systems and thus limit the functionality of the wallet,” he says.

Phone wallets have a “head start”, says Mr Kumar of, as they are directly integrated with the phone’s features such as biometric authentication. But they are not available to customers of all local banks nor accepted universally by retailers, he warns. This means the onus is on the customer to find a wallet that supports their bank account.

What else can a digital wallet do?

Rakbank has just enabled card-less ATM cash withdrawals via Samsung Pay. Mobile wallets like the Apple Wallet app can also hold electronic event tickets, flight boarding passes, electronic gift cards and loyalty cards.

How do I know a digital wallet payment is secure?

Payments ‘tokenise’ transactions in any wallet, meaning the transaction is given a unique digital identifier instead of the card number being passed on, ensuring personal details are never shared and preventing cards from being skimmed. A stolen token cannot be used from another device or in any way except that supported by the digital wallet, says Mr Shah of Mastercard. Only the payment network and your bank will have information about the transaction, adds Mohammad Gharaibeh, head of IT and mobiles (B2B) division at Samsung Gulf Electronics. As well as tokenisation, he says Samsung constantly monitors suspicious activity within the device to prevent malicious attacks.

But is using my phone really safer than cash?

Mr Kumar of says safety and security are “never guaranteed” - but if your wallet is stolen, it’s gone. Mobile wallets offer “considerably more protection” than cash, he says, as your phone can be remotely locked or wiped and linked cards blocked.

Where are the most cashless countries?

The UAE (along with India, Saudi Arabia, Egypt, Kenya and Nigeria) is one of the most cash-based societies in the world, according to 2013 Mastercard research; the most cashless countries were Belgium, France, Canada, the UK and Sweden, making 89 to 93 per cent of their transactions cashless. But Mr Kumar of says that by “not rushing headlong” into mobile wallets, the UAE has learned from the experiences of countries like India, where the initial “rapid explosion” resulted in a “fragmented landscape” and is now going through a consolidation period.

What other digital wallets are available overseas?

Google Wallet is available in the US and UK, while the PayPal app can be used as a mobile wallet in-store by showing a QR code to the merchant, also partnering with Visa, Mastercard, Apple Pay, Samsung Pay and Google’s Android Pay. Android Pay itself is available in select countries, including the US, Canada and UK. Skrill, Square Cash and Venmo are other digital wallets gaining traction, particularly for international money transfers. In-app payments can even be made via Facebook Messenger and China’s WeChat.

Will e-money ever replace cash?

UK supermarket the Co-operative predicts that 65 per cent of all transactions will be made by mobile phone by 2025, making bank cards and cash as obsolete as cheque books. “It’s only a matter of time before customers and retailers recognise the value and convenience of switching to digital payments,” says Mr Clarke of Network International.

Mastercard views “cash displacement” as a mission, says Mr Shah of Mastercard, which has seen a 300 per cent increase in contactless usage in the UAE this year. Mr Kumar of says people are still “wedded” to cash; while it will stay with us in the short term, there is now choice for the consumer, rather than an obligation to use cash, he says. “The next step is to make cashless transactions not just an option, but a preference.”