Latest news with #cashless
Khaleej Times
16 hours ago
- Business
- Khaleej Times
Dubai to allow residents, businesses to pay government fees using cryptocurrency
Dubai is preparing to use and enable crypto payments for government services, after an agreement was signed between Dubai Finance and a world-renowned cryptocurrency trading platform. This paves the way for the government to use financial technology to provide a new digital payment channel on Dubai's digital portals, enabling payment for government services using stable cryptocurrencies in a safe and innovative manner. The MoU was signed on the sidelines of the Dubai Finance and participation in the Dubai FinTech Summit, which kicked off on Monday at the Dubai International Financial Centre (DIFC). The summit marks a pivotal step in driving Dubai's digital financial landscape towards the future. Once the necessary technical arrangements for activating the agreement are completed, customers of various government entities, both individuals and institutions, are expected to be able to pay government service fees using digital wallets on the platform, which will transfer these fees to Dubai Finance accounts in Emirati dirhams, within a secure and innovative pay. The memorandum aims to support the implementation of Dubai's cashless strategy and the transition to a cashless digital society.
Times of Oman
4 days ago
- Business
- Times of Oman
Govt prioritising lower denomination notes and digital transactions: Sitharaman
New Delhi: Indian Union Finance Minister Nirmala Sitharaman said on Saturday that the priority of the government is to "make sure" that currency in circulation will be in "lower denominations" and spreading more awareness for "doing digital transfers." Answering a question on the future of Rs 500 currency, Sitharaman said, "We are making every effort to make sure that currency will be in the lower denominations, used much more than the higher, as the Rs 2000 is almost completely out of circulation, except for possibly 0.02, which is still lying outside. Others have given it to the banks." "We need to have more digital awareness built so that people see a benefit in doing digital transfers," the Union Finance Minister said at the 'National Commemorative Seminar on 60 Years of Pt Deendayal Upadhyaya Integral Humanism Lectures' in the national capital. In recent years, India has witnessed an unparalleled rise in digital transactions, marking a significant milestone in its journey towards becoming a cashless society. At the forefront of India's digital payment revolution is UPI with a record hit of 16.73 billion transactions in December 2024. In addition to this, Immediate Payment Service (IMPS) and FASTag have emerged as pivotal players, making financial transactions faster, more accessible, and secure. As of recent data from the National Payments Corporation of India (NPCI), UPI has set a new record by processing over 16.73 billion transactions, with a staggering transaction value of Rs 23.25 lakh crore. This is a notable jump from Rs 21.55 lakh crore in November. In 2024, UPI processed around 172 billion transactions, marking a 46 per cent increase from 117.64 billion in 2023. This rise underscores a broader cultural shift toward financial inclusivity, with UPI being a central pillar.
Khaleej Times
5 days ago
- Business
- Khaleej Times
Still carrying cash? Over 90% of small businesses in UAE accept digital payments
Before most of the city is awake, Deira is already moving — loud, fast, and still dealing mostly in cash. At the fish market just off Palm Deira Metro Station, the floor is slick with ice water and fish scales. Crates rattle open to reveal hammour and kingfish, striped yellow-like brush strokes. Prawns are stacked like glass, still twitching. The air smells like diesel and salt. Vendors shout in Malayalam, Arabic, and Hindi. Restaurant buyers haggle in half-sentences. A five-dirham note flutters from a pocket. No one's tapping. No one's scanning. And yet, just 20 minutes away, the future is already here. Inside a DIFC café lined with concrete and chrome, a woman in a tailored blazer taps her Apple Watch to pay for a flat white. A sign by the register reads: Contactless only. This is the UAE in 2025: one of the most digitally connected economies in the world, and yet still tethered, in many ways, to the physical currency it's preparing to leave behind. With the goal of becoming 90 per cent cashless by 2026, the country is racing towards a financial future few others have come close to reaching. In many ways, it's already there. Digital wallets are everywhere — Apple Pay, Samsung Pay, Google Pay, Careem Pay, PayBy. Contactless transactions are now so embedded in daily life that younger residents joke they haven't touched an ATM in years. Whether for groceries in Sharjah or a mani-pedi in Jumeirah, tap-to-pay is the new normal. The scale of adoption is massive. Mastercard's latest SME Confidence Index shows that 92 per cent of small- and medium-sized businesses in the UAE now accept digital payments, and many have dropped cash altogether. Eighty-three per cent of businesses say they're upgrading payment systems to keep up with customer expectations. Even in areas traditionally slower to adopt tech — tailoring shops, barbers, mom-and-pop groceries — cashless tools are creeping in. In Karama, several businesses that once only took cash now have QR codes on the counter or card machines behind them. It's less about pressure and more about practicality; once enough customers stop carrying bills, there's not much choice but to adapt. Visa's Value of Acceptance study backs that up — more than 70 per cent of the UAE merchants surveyed said they saw increased revenue and higher customer footfall after accepting digital payments. Salima Gutieva, Visa's vice president and country manager for the UAE, said small businesses often stick to cash because of 'perceived customer preference and limited payment infrastructure.' But she points to tools like Visa Direct, Tap to Phone, and Click to Pay as helping merchants overcome those hurdles. 'Education on the security and efficiency of these methods is helping more businesses see digital payments as a critical investment in growth.' The UAE Central Bank introduced a regulatory framework that allowed non-bank payment service providers to operate alongside traditional banks — a pivotal move that formally brought fintech firms into the country's financial system. It enabled services like mobile wallets, QR-code payments, and peer-to-peer transfers to scale legally. To keep pace, the Central Bank also launched sandbox environments — controlled settings where fintechs can test new products with regulatory oversight before going to market. Together, these steps have helped create a safer, more open digital payment ecosystem. It wasn't just organic growth — it was engineered. Dubai's digital authority, Smart Dubai, laid out a formal Cashless Framework, mapping the steps to a fully digitised economy. The plan starts with government services —making everything from utility bills to traffic fines payable only through digital channels. Need to renew a driver's licence or pay a parking ticket? You do it through an app or online portal. From there, the framework builds out secure 'rails' connecting banks, telecom providers, and private payment platforms. The goal is a system that's not just faster, but traceable, standardised, and built for scale. Hamad Obaid Al Mansoori, director-general of Digital Dubai, in a public statement, put it simply: 'Cashless payments are integral to daily life. We aim to establish Dubai as a global digital capital and an attractive investment destination.' And it's already paying off. According to the Emirates News Agency, the UAE's payments revenue pool is projected to hit Dh27.3 billion by 2028, fuelled by fintech growth and digital adoption across the public and private sectors. Government estimates also suggest the cashless transition could unlock more than Dh8 billion in additional economic growth annually. Still, for all the sleek infrastructure and tap-to-pay ease, cash hasn't exactly vanished. Not yet. According to Visa's Where Cash Hides report, 23 per cent of transactions in the UAE are still made in cash — mostly peer-to-peer moments like tipping valets, splitting bills, or paying for informal services. But even that number comes with nuance: 61 per cent of respondents said only one or two of their last 10 purchases were in cash. Just 3 per cent said all 10 were. Where notes are needed According to Gutieva, the cash that remains in circulation is mostly used in specific settings — like open-air markets, taxis, and informal exchanges between friends. She says it often comes down to habit or the belief that cash is quicker and more widely accepted, especially in places where digital options aren't yet the norm. 'While the UAE is advancing towards a cashless society, we still see cash usage in certain segments. This is often due to habit, the belief that cash is quicker, or retailers still only accept cash,' Gutieva said. At the same time, Gutieva points to several forces pushing adoption forward. 'Positive factors driving digital adoption include the UAE government's progressive vision, widespread smartphone use, and the popularity of ecommerce,' she said. 'Younger, tech-savvy consumers are also contributing to a shift, supported by digital platforms offering rewards, security, and convenience.' Younger, tech-savvy consumers are also contributing to a shift, supported by digital platforms offering rewards, security, and convenience" Salima Gutieva, Visa Still, that lingering reliance on cash — and what it reveals about behaviour, access, and trust — is something economist Jeremy Srouji has spent years studying. A PhD candidate in international economics at Université Côte d'Azur and the International Institute of Social Studies at Erasmus University, his work focuses on how digital payment ecosystems emerge and evolve in cash-reliant economies like the UAE. 'The move to a cashless economy is a global trend,' Srouji said. In the UAE, it's been accelerated by deliberate policy shifts — especially when the Central Bank opened the market to non-bank payment service providers, breaking open what had long been a bank-dominated space. 'This was a catalyst for diversifying the sector with mobile payments, peer-to-peer transfers, but also the lucrative online payment space.' But Srouji cautions that we shouldn't rush to call this a 'cashless' society. 'It is probably a misnomer to speak of a 'cashless economy',' he said. 'An advanced digital payments ecosystem is probably the better term, but unfortunately the marketers won that battle.' While digital payments have surged, cash hasn't exactly disappeared. He argues that cash levels have been consistently on the rise in the UAE, even as cash transactions have declined in favour of digital payments. Why? 'In a modern financial economy, there is essentially no scenario in which cash, which is central bank money, can be eliminated,' he explained. 'This is because central bank money is the ultimate guarantor of the commercial bank money — the loans, deposits, and credit instruments managed by the private banking system.' He continued: 'In a healthy, diversified, and growing economy such as the UAE, cash-in-circulation, that is cash outside of the banking system, will tend to increase alongside digital payments, in parallel with the expansion of credit, investment, and consumption.' And while policymakers often cite the shadow economy as a reason to eliminate cash, Srouji says the link isn't so simple. 'The argument is often made that eliminating cash will help to reduce the footprint of the shadow or grey economy,' he said. 'While I would agree, the matter is not as clear cut as it first appears.' He referenced a 2020 study by Cohen, Rubinchik & Shami, which 'showed that such initiatives may backfire, pushing actors in the shadow economy — particularly well-organised criminal networks — to go to more extreme lengths to launder money into the formal economy, with potentially more dangerous outcomes.' Instead of phasing out cash to crack down on crime, Srouji suggests it's more effective to focus on strengthening the UAE's existing anti-money laundering and financial crime regulations. The country has already made progress in that area, he said, and allowing cash and digital payments to exist side by side — with strong oversight — is likely a more balanced and secure approach. When it comes to financial inclusion, Srouji's stance is clear. 'If not enshrined in a comprehensive financial inclusion strategy, it can be argued that going cashless is a catalyst for financial exclusion,' he wrote. 'Truly cashless economies — such as Sweden, and South Korea — are a rarity, with low levels of inequality, where all adults have access to a basic bank account and digital payment instrument, and where the right to hold an account is often enshrined in law.' He added: 'The UAE context is different, with a rich diversity of cultures that have distinct spending and technology habits.' One key distinction, he noted, is the sheer volume of outgoing remittances by migrant workers — many of whom still rely on cash due to gaps in digital infrastructure at the receiving end. 'Some remittance corridors will always be cash-reliant, as long as digital financial services are not available at both ends of these corridors.' In simpler terms: even if a foreign worker in Dubai can send money digitally, it doesn't help if their family back home can't receive it the same way. Until both sides of the transaction are online, cash will still have a role to play. Srouji sees the UAE's digital currency experiments as a key part of making the shift to a cashless economy more inclusive. 'The question of financial inclusion is a critical one, and is the reason why, faced with the decline in cash transactions, central banks around the world are exploring central bank digital currency (CBDC) as a new form of central bank money,' he said. 'The UAE has participated in some major global CBDC initiatives, including Project Aber and Project mBridge,' he added. Aber — a joint pilot with Saudi Arabia — tested how digital currencies could be used for cross-border settlements. mBridge expands that vision, bringing together central banks from Asia and the Middle East to build a shared platform for real-time international payments. 'Depending on the model adopted, a CBDC ecosystem can provide for end-users to hold accounts directly at the central bank, which would help promote financial inclusion.' But while CBDCs aim to rebuild the architecture of the financial system, companies like Visa are focused on immediate impact. That means expanding digital payment tools into sectors where cash still dominates — and making them accessible, reliable, and secure. 'SMEs are the backbone of the UAE's economy,' said Gutieva. 'The fact that 92 per cent of these businesses are cash-free indicates a strong readiness for a digital economy… that's where the shift happens — and that's how we help the UAE meet its cashless goals.' Getting to a cashless economy isn't about one breakthrough. It requires coordination across policy, infrastructure, and user behaviour — at every level of the system. And maybe, one morning in Deira, the fish will still be fresh, the shouting still loud, the scales still wet — but the payment? That might just be a tap.
Bloomberg
27-05-2025
- Business
- Bloomberg
Bitcoin Hacks Are Replacing Bank Robberies
Opinion Digital heists are rising as we move toward a cashless world, explains Bloomberg Opinion columnist Lionel Laurent. (Source: Bloomberg)
Finextra
26-05-2025
- Business
- Finextra
Why Fintech Growth Still Depends on Physical Infrastructure: By Denys Boiko
Over the past decade, digital financial services have expanded rapidly across emerging markets. From mobile wallets to embedded finance and open banking, the technical possibilities have matured. Yet even as apps grow more sophisticated, real-world constraints persist. Fintech development has, in many cases, outpaced the environments it seeks to transform. Product roadmaps accelerate, but user uptake remains uneven. In high-growth developing regions, platforms often encounter limits because physical infrastructure and behavioural habits lag behind digital ambition. According to a recent Bank for International Settlements report, cashless payments per capita in emerging markets rose by 29% in 2023, while cash withdrawals remained stable, underscoring cash's enduring role in everyday transactions. This gap is most visible where innovation meets inclusion. While KYC automation, digital credit evaluation, and real-time payment define today's fintech landscape, large segments of the population continue to rely on cash and remain only partially connected to digital networks. Bridging this divide isn't just a product challenge — it's a question of rethinking business models and understanding behaviours that define how financial systems are used in practice. The next wave of fintech growth will likely come not from entirely new products, but from seamless integration with existing environments. Aligning Innovation with Access There's a tendency in fintech to view progress as linear: build a better interface, streamline a process, then scale. But scale does not occur in a vacuum. It depends on systems — economic, social, and physical — that enable people to adopt new services. While technology providers focus on scalability, user experience, and automation, many target users remain disconnected from digital platforms—by choice, by necessity, or by lack of access. Smartphone penetration, mobile data costs, trust in digital services and even basic identification systems vary drastically from one market to another. The result is a fundamental mismatch between how fintech solutions are perceived and how users can realistically access them. This doesn't mean fintech has failed. It means the next phase of growth will require a deeper understanding of what stands between product and participation. True scale will come not from adding yet another feature, but from integrating digital services into existing ecosystems, habits and touchpoints that people already trust. Rethinking Integration Future fintech success in emerging markets hinges on how well digital services integrate within hybrid ecosystems — part online, part cash-based. Self-service kiosks. Once dismissed as transitional, kiosks are re-emerging as cost-efficient conduits in low-connectivity environments. By reducing dependency on smartphones, they allow users to deposit or withdraw funds, pay bills and access digital platforms without owning a device or enduring high data costs. In regions where trust in apps remains low, a visible, physical kiosk lends credibility that purely digital interfaces cannot match. Agent networks. Leveraging local agents — such as corner shops, post offices or telecom retailers — enables assisted onboarding and cash-in/cash-out services. These networks bridge the trust gap through face-to-face interactions, helping users navigate KYC procedures and building confidence. In several markets, well-incentivised agents have been shown to increase onboarding rates by up to 50%, while reducing customer acquisition costs significantly. In each case, the goal is to reduce friction between cash and code — making digital finance an extension of, not a total replacement for, everyday routines. A Broader View of Infrastructure The core challenge is not to digitise everything immediately, but to design for coexistence — to accept that cash economies and physical touchpoints will remain part of the financial ecosystem for years to come. This calls for more adaptable systems: infrastructure that respects existing behaviours; interfaces that support low-data and low-trust environments; and products that don't assume continuous connectivity or seamless onboarding, but instead offer alternate routes into formal finance. To succeed, fintech must embrace a hybrid model that harmonises digital innovation with established physical pathways. Each market demands its own balance. Too often, solutions are imported wholesale, ignoring local dynamics. By designing systems that respect existing behaviours and environments, fintech can transform promise into participation. Building for Context Fintech is often described as the convergence of finance and technology. Today, the critical convergence is between digital ambition and physical execution. A superior product means little if it cannot reach the right users, in the right context, at the right time. As fintech matures, the focus shifts from invention to integration.
