Visa to support small businesses

June 17, 2020 | By RetailME Bureau

SME

Visa has launched a regional initiative called “Where You Shop Matters’ that aims to support small businesses in the UAE that are severely affected due to the COVID-19 crisis. For this initiative, Visa will be working with small businesses – like Little Majlis and El Grocer, among others – across the country.

Launching this week, ‘Where You Shop Matters’ will help support small businesses through the Visa Small Business Hub, a merchant platform providing tools and information on how to start, run and grow small businesses. The Hub will also feature leading merchants who embody the passion and entrepreneurial spirit of small businesses across the UAE. Visa will host webinars for small business owners in the UAE, sharing useful insights and tips that are critical to helping them optimise and adapt their business models for now and beyond COVID-19.

As part of this initiative, Visa has also published the COVID-19 CEMEA Impact Tracker highlighting the recent impact of the COVID-19 pandemic on commerce for consumers and small merchants in the UAE.

The findings of the report highlight increased anxiety among UAE merchants with 89% of small businesses noticing a decrease in average consumer spending during COVID-19. As consumers stay away from all but essential retail, the impact of the pandemic on merchant revenues has been high with 83% of those surveyed stating revenues have been negatively impacted.

During the pandemic, many consumers in the UAE have started shopping online for the first time, primarily for essentials. Two-thirds of UAE consumers (68%) surveyed said that COVID-19 has led to their first online grocery purchase, while 70% have made their first online purchase from pharmacies.

Overall, the report points to a shift to online commerce, with cash transactions being replaced by digital payments. The study also found that the current conditions have served as a catalyst for online commerce with 10% of merchants reporting that they have introduced online offerings as a direct result of the pandemic, while the vast majority (91%) had an e-commerce presence before the pandemic. As consumers and merchants focus on safety and hygiene, the use of contactless payments has also increased during the crisis with merchants expecting a further 32% growth post-COVID-19.

Commenting on the report’s findings, Shahebaz Khan, Visa’s general manager for the UAE, said, “This report shows how cash-only retailers were most negatively impacted while merchants who moved online and adopted contactless payment systems have been able to better weather the adversity. It is vital that merchants across the globe understand the shift in consumer behaviour and adapt accordingly. E-commerce and digital solutions are here to stay and the way forward for small businesses.”

According to the report, 59% of consumers admit to now spending less while also changing their shopping habits. Consumers are increasingly optimising their trips – 56% reported to now buying in bulk, 50% making lists to avoid impulsive purchases and 37% buying non-perishable items to ensure fewer trips. When shopping in-store, 79% of the consumers are cautious about hygiene, while 70% avoid rush hours.

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