Firms show 'incredible willingness to evolve in the face of change': Visa study
Most small and medium businesses (SMBs) in the UAE are beginning to feel optimistic about the future of their business but estimate it will be about six months before their businesses are back to full operation, a study has revealed.
While 94 per cent of SMBs in the UAE - who took part in a study conducted by Visa - are upbeat of a rebound in business compared to 67 per cent globally, they have also shown "an incredible willingness to evolve in the face of change", despite the unpredictable nature of the pandemic.
In fact, most SMBs in the UAE have pivoted to keep their businesses on track since the outbreak. Over two in five (44 per cent compared to 20 per cent globally) have allowed contactless payments for the first time since the start of Covid-19. Additionally, nearly three in five (59 per cent, versus 33 per cent) reported their business has accepted less or stopped accepting cash during the pandemic, the study said.
The Back to Business study by Visa found out that nine out of 10 consumers in the UAE have changed how they pay for purchases due to Covid-19, including shopping online using contactless payments and not using cash as much.
The study, designed to assess the dramatic shift to digital commerce in response to the pandemic, driven largely by changing consumer expectations for a safe and touchless payment moment, also found that 94 per cent per cent of small business owners are beginning "to feel optimistic about the future of business, amidst differing levels of consumers who are "supporting small businesses," the digital payments major said in a report.
"As small and micro businesses continue to endure the financial impact of Covid-19, one thing is clear: Rethinking the checkout or point-of-sale experience is essential for survival," it said.
"Consumers are putting Covid-19 safety measures at the top of their shopping agenda and favouring businesses that do the same," said Shahebaz Khan, Visa's general manager for the UAE.
"Historically, we have seen behaviour change at the point of sale as a gradual shift over time. But Covid-19 has created an immediate need for safer, more efficient shopping experiences both online and offline as consumers rapidly migrate to digital commerce," said Khan.
A recent similar study by UBS said Covid-19 remains the top concern for the majority of UAE investors. The UBS study found out 67 per cent of UAE investors are anxious about the pandemic, while 58 per cent are concerned about the rising healthcare costs. In the longer term, 80 per cent of UAE investors said they were optimistic about this region's economy for the next 10 years.
"Naturally, UAE investors remain concerned about the risks of Covid-19," said Ali Janoudi, head of wealth management for MEA at UBS.
In another survey of 8,804 people on business and employment prospects conducted by Abu Dhabi's Department of Community Development and Statistics Centre in July, 76 per cent of respondents believe the aftermath of Covid-19 will continue to be felt, although 59 per cent are confident that their employers will be back on a solid footing before the end of this year.
The Visa study said contactless payments have become a driving differentiator for consumers. Nearly all (90 per cent, compared to 63 per cent globally) UAE consumers would switch to buying from a store that installed contactless payment systems. In fact, almost three in four (72 per cent versus 48 per cent) UAE consumers wouldn't shop at a store that only offers payment methods that require contact with a cashier or other shared devices.
"Despite their willingness to adapt to new trends, 92 per cent of merchants in the UAE still have concerns about shifting their business online or increasing online presence [compared to 74 per cent globally], highlighting the need for additional support to help SMBs transition to digital," said the study.
According to the study, in terms of business operations, SMBs in the UAE are most concerned about data privacy and security (48 per cent, compared to 32 per cent), as well as keeping their employees safe and healthy (48 per cent versus 27 per cent). An overwhelming majority (89 per cent) of UAE consumers, compared to two-thirds (67 per cent) of consumers globally, are taking measures to keep their payment cards clean.
0 comments