The BNPL (buy now, pay later) market in the Middle East is predicted to reach around $90 billion by 2030, a 12-fold jump from the $7.18 billion in 2021.
Precedence Research, a global market research and consulting firm, revealed the huge potential of the BNPL market in the Middle East.
BNPL companies allow shoppers to pay for goods they purchase in instalments over several weeks or months, in this way giving them the opportunity to make big purchases.
The effects of Covid-19 ignited the BNPL industry, particularly in the MENA region, as many companies profited from being available online and having a payment solution that eased cash flow on consumers, many of whom were affected by unemployment and financial uncertainties caused by the pandemic,
Ammar Afif, CEO and co-founder of Cashew, the leading UAE-based BNPL player, told Arabian Business.
Industry experts said factors such as adoption of the newly created BNPL business model by wider demographic sections in GCC and MENA – as against the trend of millennials and Gen Z opting for it – and the high penetration level of credit cards in the region have helped the industry to get a head start in the region.
The adoption and rate of growth have been quite significant [in the Middle East]. One of the major drivers for this is that BNPL is offered for necessary services in the region, unlike, for instance, in advanced markets such as the US and Europe where it is seen as high-risk ticketing,
Favourable market conditions in the GCC and the wider MENA region offer high potentials for faster expansion plans to existing industry players, with Cashew being one of the leaders.
Among other players in the MENA BNPL market one can name Tabby, Tamara, Spotii and Postpay. Currently, they are expanding their operations in the GCC region, with their platforms scaling transaction volumes by several notches month-on-month.