Nuvei, a Canadian-based payments company with APAC headquarters in Singapore, recently launched a report called “Global Expansion Guide to High-Growth Markets”, which provides a data-driven roadmap for businesses to expand into some of the world’s fastest-growing markets. Released quarterly, each edition delves into two key regions, spotlighting market opportunities, emerging trends, and the strategies needed for successful market entry.
The first segment zooms in on Colombia and the UAE, two dynamic markets with significant growth potential, and explores the key drivers of eCommerce growth, including the proliferation of mobile payments, digital wallets, and real-time payment systems. The report also examines the distinct payment trends and challenges in these regions—from Colombia’s mobile-first payment landscape to the UAE’s high-income, luxury-oriented consumer base.
High-growth markets like these are pivotal engines of global economic expansion. Powered by advancements in digital infrastructure, rising middle-class populations, and widespread mobile penetration, these regions are projected to host nine out of ten Gen Z and Millennial consumers within the next three years. However, expanding an online business into these areas comes with its own set of challenges. For instance, without establishing a local entity, online merchants may face steep foreign exchange fees and lower authorization rates. On the other hand, partnering with a Merchant of Record can enable businesses to operate locally without the need for a physical presence.
We caught up with Willy Kwa, Regional Director of APAC, Nuvei to dig deeper into some of the report’s findings, particularly in the UAE region after its recent tourism sector developments.
Q: As a payments company operating globally, how does Nuvei view the evolution of payment landscapes in high-growth markets like the UAE?
With a population of 9.5 million and a 2023 GDP of $504 billion, the UAE has solidified its position as a high-income market with world-class infrastructure and a rapidly growing eCommerce sector. In the report, we highlighted that several payment trends are shaping the UAE’s eCommerce ecosystem:
- Dominance of International Credit Cards
International credit cards remain the cornerstone of online payments, accounting for 60% of eCommerce transactions in 2023, with projections suggesting growth to 63% by 2027. - Thriving Buy Now, Pay Later (BNPL) Industry
The UAE is leading the Middle East in BNPL adoption, with domestic players like Cashew, PostPay, Spotii, Rise, and Tabby driving innovation. BNPL accounted for 8% of eCommerce sales in 2023, the highest share among high-growth markets analyzed in this report. - Rise of Digital Wallets
Digital wallets currently account for 6% of eCommerce payments and are expected to grow to 8% by 2027. This category includes a mix of local providers, such as Careem Pay and Payit, alongside global players like Apple Pay, Google Pay, Samsung Pay, and Chinese wallets WeChat Pay and Alipay. - Emerging Real-Time Payment Systems
While real-time payments have yet to gain significant traction, initiatives like Immediate Payment Instruction (IPI) and Aani are poised to disrupt the market and accelerate adoption in the near future.
Q: How important is local expertise in adapting payment solutions to meet the unique demands of markets like UAE’s luxury-focused consumer base?
It’s critical for tailoring payment solutions to the unique needs of the UAE’s luxury-focused consumers, who expect seamless, localized experiences. For instance, cross-border eCommerce is projected to grow at a 14% CAGR, reaching $10.1 billion by 2027. Businesses need to localize websites with multi-language support, partner with regional logistics providers, and integrate preferred payment methods, such as Islamic credit cards. These adaptations build trust and accessibility while meeting the high expectations of the UAE’s affluent consumers.
Willy Kwa, Regional Director of APAC, Nuvei
Q: What roles do payment innovations such as real-time payments and digital wallets play in accelerating eCommerce growth in these regions?
In regions like Colombia, digital wallets provide a seamless entry point for millions of unbanked and underbanked consumers to participate in eCommerce. This increases the customer base for merchants while enabling faster, more secure transactions.
In the UAE, where eCommerce is booming and cross-border transactions are significant, digital wallets cater to a tech-savvy population that demands fast, flexible, and secure payment options. The integration of real-time payments aligns with the UAE’s vision for a cashless economy, reducing friction in the purchase journey and enabling faster checkout processes, which are essential for mobile commerce growth.
Together, these payment innovations not only improve user experience but also build trust and foster loyalty, creating a fertile ground for merchants to scale and for the overall ecosystem to thrive. For businesses entering these markets, understanding and integrating these technologies into their strategies is pivotal for success.
Q:How does Nuvei navigate complex regulatory environments in emerging markets, and what advice would you give businesses looking to do the same?
It requires a strategic and informed approach. We focus on providing payment solutions tailored to align with consumer behavior in each market. By leveraging local expertise and smart routing technology, we ensure seamless transactions while helping businesses manage regulatory compliance effectively, without sacrificing revenue.
For businesses entering such markets, our advice is to prioritize understanding local regulations and consumer expectations. Partnering with a payment provider experienced in navigating these environments can make a significant difference. Building trust through secure, transparent payment options and adhering to compliance requirements is key to unlocking the potential of high-growth markets.
Q: In terms of payments and value, what is a completely signature or unique trait in the UAE market, and why do you think that trait exists in the region?
In the UAE, one signature trait is the high prevalence of cross-border transactions driven by its globalized economy and expatriate-dominated population. Over 85% of the UAE’s population consists of expatriates who regularly send money back to their home countries. This has created a strong demand for fast, secure, and cost-effective cross-border payment solutions.
Q: What are some surprising findings from the Global Expansion Guide to High-Growth Markets report that you did not expect to see from the UAE market?
Some surprising findings are UAE’s high-income population and large expatriate community, comprising 88% of the population, influence eCommerce trends. This demographic creates strong demand for luxury, premium, and sustainable products.
Also, the rapid adoption of digital wallets along with the rising popularity of Buy Now, Pay Later (BNPL) services, account for 8% of eCommerce sales in 2023. The rise of local players like Tabby underscores how embedded finance solutions are resonating with younger, budget-conscious shoppers, opening new avenues for businesses to drive conversions.
Q: As mobile payments continue to rise, how is Nuvei leveraging technology to enhance the payment experience in high-growth markets?
We leverage AI-driven fraud prevention and dynamic payment routing. By integrating with popular mobile wallets and offering localized solutions tailored to each market, Nuvei empowers businesses to meet consumers where they are on their devices while ensuring reliability and scalability.
One success story is our work with a luxury retailer in the UAE. Using Nuvei’s intelligent payment optimization technology, including our smart routing engine and 3DS solution, we improved their transaction approval rates. The smart routing engine enabled the retailer to dynamically route transactions to different banks. This led to a 30% increase in acceptance rates.
Q: Looking ahead and based on the report, what payment trends or innovations do you foresee shaping the eCommerce landscape in the UAE, and other emerging markets in APAC?
Looking ahead, several key payment trends and innovations will shape the eCommerce landscape in the UAE and other high-growth markets.
- AI-Driven Fraud Prevention and Enhanced Security: AI and machine learning are becoming essential in fraud prevention. There’s also ‘optimized customer experience’, meaning AI helps balance fraud detection with a seamless customer experience by minimizing false declines and customizing fraud controls based on local risk profiles.
- Blockchain and Cryptocurrency Adoption – Cryptocurrencies, particularly stablecoins, are gaining traction as faster, lower-cost solutions for cross-border payments, making transactions more efficient.
These trends reflect a consumer-centric shift driven by convenience, security, and tech advancement. Businesses looking to expand into the UAE and APAC markets must adopt payment technologies, focus on localization, and align with regulatory frameworks to capture the immense potential in these dynamic regions.
