Are people paying online in the UAE?

Are people paying online in the UAE?

UAE e-commerce seems to be booming as the country's tech-savvy, young population embraces online shopping, but consumer wariness about paying over the internet will constrain growth until retailers find a convincing alternative for cash-on-delivery (COD).

Ostensibly, the signs are encouraging. A Visa survey published in June found that 63 per cent of UAE internet users shop online, with each shopper on average spending $1,648 annually. Average transactions values were $144, nearly six times the emerging market mean of $26.

Yet this high purchase price also indicates that UAE consumers are not so much shopping online for goods they could buy in a store but for intangible services such as government services and education, airline tickets, transport and telecom subscriptions. General retail services and goods only accounted for 6 per cent UAE e-commerce sales value in the 12 months to the end of February 2019, according to Visa.

Such intangible services do not require the physical delivery of a product; convincing shoppers to pay online for goods they will later receive at their home or workplace is proving a tougher sell and that spells trouble for e-commerce retailers, with less than 5 per cent of total UAE retail sales conducted online.

That was a key