Digital Payments Gain Traction Among Small and Medium Enterprises in Egypt, According to Visa Report
In a significant development for Egypt's business landscape, Visa has released a comprehensive report titled "Value of Acceptance: Understanding the Digital Payment Landscape in Egypt." The findings shed light on the current state of digital payment acceptance, exploring both opportunities and challenges.
Key Findings
The report reveals a rapid growth in digital payment adoption among Egyptian merchants. Over half (53%) of merchants have implemented digital payments in the last two years, and 55% of cash-only merchants plan to transition to digital payment methods soon. This shift towards digital payments is driven by numerous benefits, including boosted revenue, improved customer satisfaction, and reduced operational risks.
Moreover, over 80% of merchants using digital payments are satisfied with the card acceptance process, and more than 75% report increased revenue. Beyond basic payment acceptance, merchants seek features like loyalty programs, enhanced security, and data-driven insights to support business growth, improve customer experience, and raise operational efficiency.
The rise of e-commerce is also evident, with 59% of SMEs now accepting online payments, and 53% utilizing social media platforms as payment channels. The report suggests a digital commerce expansion, indicating a growing trend towards cashless transactions.
Challenges
Despite the promising growth, the report also identifies several challenges that must be addressed to unlock the full potential of Egypt's digital payments landscape. Many cash-only businesses require user-friendly and simple digital payment solutions that replicate the convenience of cash transactions. There is a strong need for educational programs to correct misconceptions and provide incentives to facilitate this transition.
SMEs are also looking for integrated digital payment solutions that offer more than just transaction processing. Current offerings may not fully meet their needs for integrated business tools. Regulatory and formalization hurdles also pose challenges, as aligning digital payment adoption with government efforts towards SME formalization and tax incentives requires careful consideration.
Collaborative Efforts
To facilitate financial transactions for business owners, Visa has partnered with Egypt's Micro, Small and Medium Enterprise Development Agency (MSMEDA). This collaboration aims to provide advanced electronic payment solutions and introduce electronic invoices, contributing to easier project management, enhancing opportunities for funding and technical support, and positively impacting the ability of SMEs to operate, sustain, and grow.
In summary, Visa's report highlights a robust and growing digital payments adoption among Egyptian SMEs, driven by enhanced revenue and customer engagement, but facing challenges in converting all cash-based businesses and fulfilling SMEs’ broader needs for integrated, simple, and value-added digital solutions. The partnership between MSMEDA and Visa is a significant step towards addressing these challenges and empowering SMEs, which is a main pillar of economic growth in Egypt.
- To improve and support the growth of small and medium businesses in Egypt, Visa is collaborating with the Micro, Small and Medium Enterprise Development Agency (MSMEDA) to provide advanced electronic payment solutions, promote the use of electronic invoices, and offer integrated business tools.
- As digital payment adoption in Egypt grows, there is a need for technology and educational efforts to make digital payments more user-friendly for cash-only businesses, correct misconceptions about security, and offer loyalty programs, enhanced security, and data-driven insights to meet the growing needs of merchants.
