BNPL payments in the UAE are expected to grow by 22 per cent on an annual basis and reach $2,531.1 million this year, according to a new Research & Market report on the BNPL market.
The medium to long-term growth story of the BNPL industry in the country remains strong. This trend is here to stay as BNPL payment adoption is forecast to grow steadily till 2028, recording a compound annual growth rate of 12.3 per cent.
Equally important, the BNPL gross merchandise value in the country is bound to increase from $2,075.2 million recorded last year to $4,525.2 million by 2028.
The BNPL payment industry in the UAE has been going from strength to strength over the last four quarters, supported by increased e-commerce penetration. This, coupled with the surging e-commerce market and digital payment ecosystems has buoyed the success of the buy BNPL segment across the UAE. With more consumers shopping online in 2022, compared to 2021, the trend has translated into a higher adoption of BNPL schemes across the country.
According to the publisher estimates, more than 37 per cent of consumers claimed to have used the BNPL payment schemes in the UAE last year. This is a significant increase compared to the 24 per cent a year before.
Noteworthy, UAE consumers are also resorting to BNPL schemes across a broader set of product categories.
With credit card rates rising in the UAE, consumers are flocking in droves towards the zero-interest BNPL schemes offered by fintech firms like Tabby and Tamara in the country.
Amid the rapid adoption, the BNPL schemes are exploring new paths to broaden their product scope. These innovations will keep bolstering the industry growth and the adoption among consumers from the short to medium-term perspective.
In addition, domestic BNPL firms are expanding their regional operations to accelerate growth rate in response to enthusiastic demand.
Amid rising competition in the domestic market, UAE-based BNPL providers are now targeting growth in other regional countries to drive the next growth phase of their deferred payment service.
