This is the second year in a row that Visa and DED are running the campaign in the UAE.

The week’s theme is staying safe when shopping online, with Visa and DED surveying consumers across the UAE to understand their experiences, attitudes and behaviors regarding e-commerce.

Mohammad Ali Rashed Lootah, CEO Commercial Compliance & Consumer Protection, DED, said: “With the country’s e-commerce sector growing rapidly, UAE Card Security Week is an important and timely opportunity to educate shoppers about staying safe online. This study highlights the many opportunities that have been realized, while also identifying a number of challenges that still lie ahead. In particular, the sector’s continued growth now depends on the quality of the customer experience and the security of their transactions being maintained despite ever-increasing volumes of activity.”

UAE’s e-commerce sector surges
The study found that the majority (56 per cent) of UAE consumers are now frequent online shoppers, making purchases at least once a week, compared with 39 per cent in the same study from last year.
Meanwhile, the number of infrequent shoppers, namely those making online purchases every two to three months or less, has halved in a year, from 20 per cent to 10 per cent in 2017. The average monthly amount spent online is also slightly on the rise, from AED1,375 to AED1,479, while one fifth (21 per cent) of respondents say they spend more than AED2,000.
The UAE’s e-commerce sector is seeing significant growth across nearly all categories, according to survey respondents. Travel and entertainment and utilities remain key categories, while movie tickets (up 18 per cent) and restaurant orders (up 17 per cent) and groceries (up 16 per cent) all saw major growth over the last year. Government payments increased by 12 per cent pointing to the success of the UAE’s smart city initiatives.

Security concerns and quality issues could be holding back e-commerce
The survey identified reluctance among some consumers to pay electronically for certain goods and services they buy online. For all product categories surveyed there is 4-12 per cent difference between consumers buying and paying for goods and services online, with the trend particularly pronounced with clothes/apparels, electronic goods, restaurant orders and food items, suggesting people want to see the goods first before making payment. This discrepancy creates unnecessary friction in the system, such as the inconvenience to consumers of having to take out money, and the cost to merchants of handling cash and checks.

Overall, however, cards continue to gain popularity over cash. 68 per cent of respondents say they prefer using cards to make online payments, up 5 per cent on the 2016 study. Conversely, cash-on-delivery fell in popularity to 22 per cent (down 7 per cent).

Being secure when shopping online continues to be highly important to UAE shoppers, but the study found the more consumers use their cards, the more secure they feel. 79 per cent of payment card users say they feel secure when paying online, compared to 37 per cent of non-users.

While consumers are right to be alert when shopping online, the survey found the reported incidence of payment card fraud is actually relatively low at 14 per cent, broadly in the line with last year (15 per cent).

Maintaining momentum in the UAE’s e-commerce sector and cashless economy drive
Approximately a third of respondents (32 per cent) say a barrier to them paying by card online is that they want to see the product first-hand before making payment, while 42 per cent choose cash on delivery because it assures product delivery.

Consumer anxiety about shopping online is exacerbated by concerns about unfamiliar websites, with only 12 per cent reporting they would shop from sites they do not know. Security concerns and a lack of trust towards product quality are cited as the biggest barriers.

The study suggests that one of the keys to expanding the e-commerce sector and increasing the use of digital payments is for merchants to offer a clear refund or replacement policy. More discounts and rewards would also influence 85 per cent of respondents to pay electronically when shopping online.

A safe and secure online shopping environment
Visa encourages online shoppers to take measures to protect their card when shopping online, for instance by not sending their card number and CVV by email or phone, by avoiding unfamiliar websites, by not entering card details on suspicious promotions that seem too good to be true, and by activating tools like Verified by Visa (VbV), an authentication tool that ensures payments are made by the rightful owner of the Visa account.

Neil Fernandes, Head of Risk at Visa Middle East and North Africa, commented: “With consumers in the UAE shopping and spending more online than ever before, ensuring trust in the system is of paramount importance. To overcome consumer concerns and to unlock the UAE’s full e-commerce potential, Visa advocates a multi-layered security approach to tackling fraud, with the cardholder an integral part of the solution. Equally, there are a number of relatively simple steps merchants can take to build further confidence in the online shopping experience.”

An important part of Visa’s multi-layered approach is Visa Token Service, which replaces the traditional 16-digit primary account number (PAN) with a digital “token” for online purchases and transactions initiated with mobile devices. Visa is working to bring tokenization to eCommerce, which will provide added security to online transactions by removing cardholder information from the merchant environment.

“UAE Card Security Week is a key component of Visa’s ongoing efforts to support governments across the world move to cashless societies and achieve their visions of creating smart cities, and builds on similar initiatives around the world. This year, Visa will launch similar initiatives in three other countries in the Middle East and North Africa as part of its work to develop the region’s electronic payments landscape,” added Fernandes.