The buy now pay later (BNPL) platform market facilitates merchants and customers to transact through installment payments for online purchases. BNPL platforms provide convenient payment options to customers by dividing the total cost of purchase into interest-free installments, without any advance credit checks. They enable customers to spend more by eliminating the need to pay the entire amount at one go while allowing merchants increased sales by converting more browsers into buyers. The BNPL platforms in the Middle East and North Africa (MENA) and Commonwealth of Independent States (CIS) regions are gaining traction owing to rise in digital lending and e-commerce adoption.
The Global MENA And CIS BNPL Platform Market Size regions have seen rapid urbanization and rising internet penetration in recent years, fueling the growth of e-commerce. According to estimates, the e-commerce market in MENA is expected to reach $48 billion by 2022. Meanwhile, the online retail sales in CIS countries have risen at about 15% annually in the last few years. BNPL platforms address the lack of alternative payment options and bridge the gap between online shopping and cash-based societies prevalent in these regions. They enhance both customer and merchant experience by facilitating flexible payment plans and driving impulse spending. Some of the major players operating in the MENA and CIS BNPL platform market include Tabby, Tamara, and Spotii.
The Global MENA and CIS Buy Now Pay Later Platform Market is estimated to be valued at US$ 1554.49 Bn in 2024 and is expected to exhibit a CAGR of 9.8% over the forecast period 2024 to 2030.
Key Takeaways
Key players operating in the MENA and CIS BNPL platform market are Tabby, Tamara, and Spotii. They have partnered with merchants across diverse categories like electronics, fashion, and travel to expand usage of their payment platforms.
There is growing demand for BNPL services among Gen Z and millennial consumers who prefer installment-based payments for budgeting purchases or delayed gratification needs. Easy repayment tenors without interest charges are bolstering the uptake of BNPL platforms.
Technological upgrades like facial recognition, behavioral analytics, and open banking are helping BNPL providers improve risk assessment and fraud detection capabilities. Partnerships with banks also allow platforms to tap alternative data sources to broaden customer access.
Market Trends
Rise of mobile-first BNPL apps - Platforms are focusing on developing lightweight mobile applications with easy sign-up and checkout processes customized for smartphones. This is stimulating demand for on-the-go purchases.
Partnering with merchants across verticals - BNPL providers are collaborating with both online and offline merchants across diverse categories like electronics, furniture, healthcare to strengthen merchant networks.
Open banking and embedded finance - Partnerships with banks allow platforms access to banking transaction data helping improve underwriting. BNPL options are also being integrated at physical points-of-sale.
Market Opportunities
Tapping the underbanked population - Significant proportion of population without credit histories can be prospective customers. Simplified credit processes make BNPL an attractive option.
Integrations with messaging and social commerce - Platforms can leverage popular messaging platforms and social networks for customer acquisition as well as enable BNPL on influencer-driven sales channels.
Bundling ancillary financial services - Successful BNPL players can explore adding services like savings accounts, buy now pay smarter programs for repeat customers and merchant financing.
The MENA and CIS Buy Now Pay Later Platform Market has been significantly impacted by the COVID-19 pandemic. Lockdowns and social distancing measures imposed during the peak of the pandemic saw a surge in online retail sales as consumers shifted their spending online. This benefited the Buy Now Pay Later segment as it provided consumers with a convenient and flexible payment option when making online purchases. However, the economic downturn also negatively impacted consumer spending power leading to a reduction in overall retail sales.
Buy Now Pay Later providers saw much higher adoption rates during the pandemic as more consumers opted for interest-free installment plans over credit cards to manage their payments. This helped drive growth for the Buy Now Pay Later Platform Market during the pandemic period. Looking ahead, factors like rising smartphone and internet penetration along with growing financial inclusion in the region are expected to further boost adoption rates. At the same time, high unemployment rates and uncertainty caused by recurring waves of infections remain key challenges that could impact consumer spending in the near future. Buy Now Pay Later providers will need to focus on financial wellness programs, budgeting tools and flexible repayment options to support struggling consumers in the post-COVID environment.
In terms of regional concentration, the MENA and CIS Buy Now Pay Later Platform Market is currently dominated by the United Arab Emirates, Saudi Arabia and Russia in terms of total transaction value. This is driven by the developed digital payments infrastructure and high smartphone penetration rates in these countries. Meanwhile, Turkey has emerged as the fastest growing regional market owing to initiatives by the government and digital lenders to promote financial inclusion. Other high growth nations include Egypt, Indonesia and Vietnam due to their large, young populations and rapid uptake of online shopping.
The MENA region is a key geographical focus area for Buy Now Pay Later providers given the concentration of high-income spenders in countries like the UAE and Saudi Arabia. In comparison, the CIS region provides higher growth opportunities led by developing markets like Russia, Turkey and others. Overall, Southeast Asia represents the biggest growth opportunity globally for the Buy Now Pay Later space over the coming years supported by favorable demographic trends and a conducive regulatory environment for digital lending.
Get More Insights On This Topic: https://www.pressreleasebulletin.com/mena-and-cis-buy-now-pay-later-platform-market-forecast-outlook-trend-2023-2030/
Sign in to leave a comment.