Cash is Key to E-commerce in the Middle East and North Africa
New research shows cash remains a key economic driver in the Middle East and North Africa (MENA), especially with regards to e-commerce payments.
A study by international fintech company checkout.com finds that while cash on delivery has decreased in popularity, MENA remains ‘relatively cash-friendly’ and physical currency continues to play a significant role in the digital economy, especially among consumers aged below 25 and above 45.
This is a region which has long been associated with the primacy of cash. Cultural, historical and socio-economic forces have all been powerful drivers of the regional attachment to cash, and, even in the e-commerce era, to cash on delivery.
15,500 consumers were surveyed between 2020 and 2022 to inform the report, which also shows a sustained rise in the adoption of digital wallets, especially in Egypt, Qatar and Saudi Arabia. Despite noted efforts from the Saudi government to promote digital payments, ‘in the youngest demographic, we see cash “consuming” card usage’, though cash sits below digital wallets in terms of overall e-commerce payment preference.
While the use of cash on delivery has declined in most nations—though notably not in Bahrain, which continues to use it for around 20 percent of transactions—it remains popular across MENA, most especially in Pakistan, Egypt and Jordan.
The findings of this report align with research by Shopify published earlier this year, which suggests there is significant demand for cash-on-delivery payments when people are shopping online.
Popular retailers are embracing cash on delivery as a way to make online shopping more convenient and less financially risky for consumers.