Host: In the UAE, more than half of domestic Visa payment volume now happens online or in an app. It is the biggest jump since 2019 of any market in Visa’s new couch economy study. From food delivery to streaming, it tracks how convenience is reshaping spending. Joining me is Mohamed Bardastani, Visa’s CEMEA Economist and Director of Business and Economics Insights. Thank you for joining us today.
Mohamed Bardastani: Thank you for having me. It’s a pleasure to be here.
Host: The study found that 55% of domestic Visa payment volume in the UAE is now online or in app. Is that new spending, or the same money just moving online?
Mohamed Bardastani: It is actually both. In 2019, 35% of total domestic spending was online or in app. Today it is 55%, so more money is being spent online and in app than when you go to a shop. If you separate in-person spending from online and in-app spending, we see a significantly faster rate of growth online, which is why I say it is both. I also don’t think this is just about how consumers spend. It is broadly about how consumers allocate their time, their attention and their spending.
Host: Frequent online shoppers went from under 5% of UAE cards to about 1 in 4. Why such a leap, and how much runway is left?
Mohamed Bardastani: There are a lot of reasons. The parallel I think about is 2020, when Covid hit and we saw a significant shift to contactless cards, where you tap and move on rather than inserting your card and entering your PIN. Here we have seen a shift to online spending because people find it convenient. You save your card credentials on an app, and the payment recurs in the background without you thinking about it. So it went from 1 in 20 cards in 2019 with ten or more online purchases to more than 1 in 4. Convenience is one reason. Then there are macro factors: a strong digital economy in the UAE with services you can access easily online, very high smartphone penetration, and a young demographic with a high concentration of Gen Z and millennials.
Host: Food delivery went from about 2% of UAE cards in 2018 to nearly 30% today, well ahead of the UK and US. What does that say about how UAE households live?
Mohamed Bardastani: Again, it is not a single factor. You have the busy lifestyle of young professionals, the convenience and availability of multiple food delivery apps, and a competitive price point, especially compared with other advanced markets. Affordability and accessibility together drove higher penetration. We are talking about roughly 1 in 3 cards that regularly transact on food delivery apps.
Host: This growth came mostly from everyday spenders, not high earners. Why has convenience become a mass market habit rather than a luxury?
Mohamed Bardastani: In the past, when we were talking about the 2%, the people using food delivery apps were well off, and it might be a weekend indulgence. When we analysed what is driving spend and segmented consumers, the main engine of growth is now everyday consumers. It is affordable, it is becoming embedded in daily habits rather than something occasional, and there are promotions and relatively cheap price points. All of that drove much faster penetration.
Host: Streaming still beats cinemas and concerts in the UAE, but the share of cards with subscriptions has eased from its peak. Are consumers starting to trim?
Mohamed Bardastani: I wouldn’t say trim. It is more of a maturation. This year 4% of cards transact on cinemas, concerts or in-person entertainment, while for subscriptions it is 8%, and that is plateauing. There are many reasons. There are multiple subscription options, and some consumers are prioritising which ones to keep and which to cancel. In the past you had a couple of options, but now there are more specialised services catering to certain demographics, languages or TV styles, so consumers are becoming more selective.
Host: Convenience seems to be the default expectation now. What does that mean for retailers, restaurants and banks?
Mohamed Bardastani: Convenience is the name of the game. Businesses need to interact with the consumer ideally on a digital platform, otherwise they become irrelevant. The experience has to be seamless, with no friction, a standard quality, reliable delivery times, and payment happening in the background without the consumer thinking about it. That is how you reach consumers where they are.
Host: Among the six markets in the study, the UAE’s online share jumped the most since 2019, and now matches the UK. What is different about UAE consumers?
Mohamed Bardastani: Multiple factors. You have an advanced digital economy where many services are digitised and easy to access online or in an app. You have a young demographic with a significant concentration of Gen Z and millennials, smartphone penetration among the highest in the world, and fast internet. Together these are driving digitalisation here.
Host: What one signal should businesses and investors watch to know whether the couch economy has peaked in this region?
Mohamed Bardastani: My personal view is that there is still plenty of runway. The most important signal is the frequency of online purchases. It went from 1 in 20 cards in 2019 to more than 1 in 4 today, which shows that this convenience is becoming embedded in everyday life. 1 in 4 is good, but it could be 1 in 3 or 1 in 2, and we are going to see a much faster rate.
Host: Thank you very much for these valuable insights into how the market is changing.
Mohamed Bardastani: Thank you for having me.
