BNPL E-Commerce to Overtake Cash Payments on Black Friday
BNPL is expected to be the top payment method in the UAE and Saudi Arabia on Black Friday this year.
E-commerce payments via buy now, pay later (BNPL) are expected to overtake cash payments on Black Friday in both volume and value for the first time, predicts online retail management platform Uplo. In an emailed press release, Uplo said that it expects BNPL to account for 26% of purchases, while cash will drop to 23%, and credit/debit cards will account for 51% of purchases in the UAE.
In Saudi, Uplo forecasts an even bigger surge, with BNPL rising to become the top payment method this Black Friday, accounting for 37% of sales. Credit/debit cards are expected to account for 34% of payments and cash-on-delivery for 29% of payments.
According to Uplo’s data, cash-on-delivery usually accounts for 35% of e-commerce purchases, while credit and debit cards account for 42% of payments in the GCC. BNPL has traditionally lagged, accounting for 23% of e-commerce transactions.
Uplo attributes the surge of BNPL to increased online integrations and the rise of BNPL across the region. With Black Friday coming before payday for many employees, it is expecting more people to leverage the payment method, making 2023 a record year for BNPL providers.
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Buy now, pay later (BNPL) -- a payment method that allows customers to purchase items and pay over installments of several weeks or months -- is surging as a fintech solution in MENA. BNPL providers like Saudi and the UAE’s Tabby, which became the GCC’s first fintech unicorn earlier this month, have made BNPL payments more accessible to e-commerce users and providers. On Thursday, Saudi Arabia’s PayTabs and Tabby signed a partnership agreement to make Tabby’s postpaid services available to PayTabs customers in Saudi Arabia and the UAE.
Uplo (formerly CNNB Solutions) is an online retail solutions platform that has managed brand centers in the UAE, Saudi Arabia, and Egypt.
A report published earlier this year by EZDubai estimates that the e-commerce market, which hit $37 billion in 2022, will grow at an estimated CAGR of 11% between 2022 and 2026. [1]