Overall cards spending in UAE increased 14 per cent this Ramadan

Business

Overall cards spending in UAE increased 14 per cent this Ramadan

Overall spending in the UAE has increased by 14 per cent as compared to last Ramadan, according to a new report by Network International, the leading payment solutions provider in the MENA region. The report, based on credit or debit card transactions by country during the period of Ramadan 2015*, found that the major surge came from stronger domestic market spends with a 17 per cent growth in spending, while international spends also witnessed overall growth of seven per cent. During Ramadan, domestic spend spend on UAE issued credit and debit cards was 75 per cent of total spending.

David Mountain, Chief Commercial Officer, Network International, commented: The coinciding of the Islamic calendar with the traditionally quieter summer months in the UAE has given rise to interesting variations in spends, with the market still registering a strong overall increase. Domestic spend of locals and expatriates based in the UAE becomes particularly important during these months. Network Internationals data provides retailers and businesses useful insight and guidance while formulating marketing and sell strategies as it indicates which nationalities affect spending and influence overall sales.

Who were the biggest spenders?
North Americans were 7 per cent of total spend and GCC were 3 per cent, and their spend increases grew in line with domestic spend. The rest of world spend, which is 15 per cent of total spend was flat, driven by significant shrinking from the Russians (down 30 per cent), the Chinese (down 22 per cent) and the Germans (down 8 per cent). This seems to reflect recent economic turmoil in all three countries. The UK and Saudis had the largest growth amongst the foreign spend. Nigerians represented 3 per cent of foreign spend (1 per cent of total) breaking into the top 10 nationalities for the first time.

Where did they spend?
In the hotel sector, spending growth was a modest 5 per cent, and almost half of this spend came from UAE residents taking advantage of Ramadan packages for domestic travel. This domestic tendency was even more pronounced in restaurants, who saw domestic spend accounting for 83 per cent of the total spend. Driven by this spend, restaurants enjoyed an increase of 27 per cent spending as compared to last year. The malls found things more challenging - spending was flat for jewelry and high-end watches, but fashion witnessed a growth of 12 per cent in terms of absolute spend, driven in part by a surge in Nigerian spending. In addition supermarkets saw an increase of 12 per cent indicating an increase in household consumption during Ramadan.

Services generally performed well versus 2014, with professional services and government services up well over 25 per cent versus last year. These sectors, as is typical, are largely domestic spending.