Buy Now, Pay Later (BNPL) seems to have taken the market by storm, allowing you to break up your purchases, at checkout, into a series of monthly installments.
Particularly in the Middle East, the projected growth of the BNPL market is exponential and expected to reach an estimated $90 billion by 2030. This will be a huge jump from the $7.18 billion valuation estimated by Precedence Research – a global market research company, in 2021.
This anticipated growth has set off an expansion frenzy among the current BNPL providers in the Middle East, especially in the UAE.
One of the companies at the front of this expansion train is UAE- based BNPL provider, cashew.
“The effects of Covid-19 ignited the BNPL industry, particularly in the MENA region, as many companies profited from being available online and having a payment solution that eased cash flow on consumers,” explained Ammar Afif, CEO and Co-Founder at cashew.
During the pandemic, several players entered the BNPL market simultaneously, creating an increasingly competitive climate for onboarding and partnering with merchants. While this made it highly difficult for the providers, it spurred the market forward and allowed for rapid growth.
With different industries targeted by buy now, pay later in the UAE as compared to developed markets, could also have been a crucial factor aiding its accelerated growth.
“The adoption and rate of growth have been quite significant [in the Middle East]. One of the major drivers for this is that BNPL is offered for necessary services in the region, unlike, for instance, in advanced markets such as the US and Europe where it is seen as high-risk ticketing,” said Ibtissam Ouassif, Co-Founder and CPO at cashew.
Noticeably, in markets with higher credit card adoption, there seems to be increased consumer demand for an alternative to this credit line. Whereas in markets with low credit card penetration, there is high demand for a method of short-term credit.
In both cases, the interest-free BNPL option will be favorable, and plays to the needs of the consumer, while also gaining traction and growing its potential.
Ouassif hinted at the ambitious expansion plans of cashew, explaining that the environment in the GCC and Middle East is favorable for current industry players.
Since cashew partnered with Mashreq bank in 2022, they have been able to offer their customers a vast range of products, including a longer tenure of credit and higher ticket purchases.
Although the adoption of BNPL is quite one-sided – the retail sector seeing the highest adoption, cashew is confident that they can break into the telecom, travel and healthcare industries over time.
The BNPL market is on track for great things, and cashew is at its forefront. So, join them on this journey of expansion and buy now, pay later with cashew.
