Middle East & Africa Credit Card Transactions Market Outlook, 2029

Market Dynamic

Market Drivers • Changing Consumer Preferences: Convenient, safe, and adaptable payment methods are becoming more and more in demand in the MEA area as customer tastes change. Credit cards are an appealing option for customers looking to properly manage their money since they provide advantages including cashback incentives, travel privileges, and purchase protection. Furthermore, the acceptance of technological advancements and digital payment solutions, including contactless payments and mobile banking applications, is in line with the desires of contemporary customers, who are becoming more and more dependent on digital channels for transactions. The MEA region's credit card transaction industry is expanding as a result of consumers' shifting tastes, which are driving the use of credit cards as the preferred payment method both online and offline. • Economic Growth and Rising Affluence: Economic growth in the MEA region, coupled with rising affluence among consumers, fuels the demand for credit card transactions. As disposable incomes increase and standards of living improve, consumers have more purchasing power and a greater appetite for discretionary spending. Credit cards provide consumers with access to credit facilities, allowing them to make purchases beyond their immediate means and spread payments over time. Moreover, rising affluence leads to lifestyle changes and aspirations for higher-quality goods and services, driving demand for credit card transactions for a wide range of purchases, including retail shopping, dining, travel, and entertainment. Market Challenges • Currency Fluctuations: The market for credit card transactions in the Middle East and Africa (MEA) is severely hampered by currency volatility. The MEA area is distinguished by a variety of economies, each with a currency that is prone to volatility because of a range of causes, including shifts in global financial markets, commodity price movements, and geopolitical unpredictability. Credit card transactions can be impacted by currency changes in a number of ways. First off, swings in exchange rates can impact the cost of goods and create confusion over the total amount paid in local currency for customers conducting business internationally or visiting other countries. Second, changes in exchange rates can have an effect on pricing policies, profit margins, and financial planning for retailers and companies that take credit card payments. • Low Card Acceptance: Low card acceptance is another significant challenge facing the Middle East and Africa credit card transaction market. Despite the increasing adoption of credit cards by consumers, particularly in urban areas and among affluent segments of the population, card acceptance remains relatively low in many parts of the MEA region. Merchants, especially small businesses and vendors in rural or underserved areas, may be hesitant to accept credit cards due to factors such as high transaction fees, limited access to payment infrastructure, and concerns about security and fraud. Additionally, cultural norms, religious beliefs, and regulatory barriers may also influence merchant attitudes towards card acceptance. Low card acceptance limits the utility and convenience of credit cards for consumers, forcing them to rely on cash or alternative payment methods for transactions. This lack of acceptance hampers the growth of the credit card transaction market in the MEA region, constraining opportunities for businesses to expand their customer base and driving financial exclusion for consumers who prefer or rely on credit card payments.