UAE consumers turn to plastic when abroad
The number of UAE consumers turning to plastic while travelling is increasing, making the country now one of the rapidly growing markets in the world for payment card usage, Visa Middle East told Gulf News.
Recent figures gathered by the global payments technology company showed that card usage among UAE residents visiting other countries both for leisure and business registered a 12.2 per cent increase to $2.5 billion in 2012.
"The UAE, and indeed the wider Middle East and North Africa region, is now one of the fastest growing regions in the world for card usage and we believe that in the coming decade will increasingly catch up with the usage levels experienced in more mature and developed markets around the world," said Marcello Baricordi, general manager for Visa in the UAE and Global Accounts lead.
Baricordi said consumers are now warming up to the benefits and convenience of credit and debit cards when making transactions abroad. Cards eliminate the need of carrying cash and foreign currency while travelling. They allow users to conveniently access their funds from ATM machines abroad and make digital payments at millions of merchant locations in various countries.
It wasn't too long ago when many cardholders started ditching their plastic money in favour of cash for fear of racking up enormous amounts of interest charges and debt. Visa's latest figures suggest a changing consumer mindset.
"Part of that growth is thanks to the education that Visa and its partner banks provide to cardhodlers about the products that work best for them and give them a clear understanding of how they can take full advantage of the benefits and features of [payment card products]," said Baricordi.
Financial experts have warned that the use of cards abroad can lead to enormous bank charges, such as transaction and withdrawal fees.
Consumers don't just use their credit or debit cards more often, they are more likely to spend more during their trips abroad.
Visa's latest Global Travel Intentions Study 2013 showed that consumers worldwide intend to increase their spending while on holiday abroad, with the average global travel budget of $2,390 per trip forecast to increase to $2,501 this year.
The highest spenders last year were people from Saudi Arabia, spending an average of $6,666 per trip, followed by Australians ($4,118) and Chinese holidaymakers ($3,824).
"Global economic woes have been well-documented over the past few years, but our [study] hints at a change in both the financial landscape and consumer mindset, suggesting either economic recovery or a growing appetite for larger travel budgets," said Ross Jackson, head of cross-border in Asia Pacific, Central Europe, Middle East and Africa at Visa.