A recent IMF report titled “Financial Technology, Inclusive Growth and Cyber Risk: Focus on the Middle East” had some interesting points about Kuwait and the increase in digital spending among residents. According to the study, Kuwaitis are the best in the Gulf region in financial culture, with about 44 percent of adults in Kuwait having financial knowledge. Financial knowledge is the ability to use knowledge and skills to effectively manage financial resources and make sound financial decisions for the sake of well-being.
On the other hand, the report pointed out that the presence of ATM machines is important in financial coverage. According to the data, Kuwait occupies the first place in the region in the number of ATMs per 100,000 adults. I think it’s great to have ATMs in nearly every corner because people do not have to carry a lot of cash and avoid theft.
Indeed, digitization can facilitate efficiency and transparency in government processes, and support humanitarian efforts and initiatives to tackle corruption, the report said. Digital payments make government transactions transparent and subject to review and scrutiny, which can help reduce corruption and fraud. The study confirms that in terms of subsidies and social transfers such as aid and grants, Kuwait ranked first in the region. I believe that this report confirms general observations of all residents of Kuwait, both citizens and expatriates.
In June 2018, a report was issued by the Joint Automated Banking Company (KNET) on spending by Kuwaitis and residents in 10 days of over $1.6 billion, where spending varied between cash withdrawals and purchases through point-of-sale machines in various shops across Kuwait and via KNET. The total amount withdrawn from ATMs in 10 days amounted to KD 190 million through 1.8 million transactions.
With regards to traveling, official statistics showed that Kuwaitis’ expenditure on travel in 2015 reached KD 3.7 billion, including items such as expenditure on university scholarships and treatment abroad, which made up 18 percent of the total. VISA released results in April relating to GCC countries as part of its comprehensive study of global trends in tourism and travel. It found travelers from the UAE, Saudi Arabia and Kuwait rely on cards and electronic devices at every stage of their travel, and connect to the Internet when they are abroad.
I agree that this huge spending is justified when traveling to distant places, especially for travelers from Kuwait, for example, who prefer cold European destinations in summer, with expensive flight tickets and accommodation. Also, members of Gulf families are relatively larger, and thus the withdrawals of money and the use of ATM cards will be greater, along with the use of the phone and Internet. Technology helps GCC travelers to use mobile devices to connect to the Internet during their journeys.
In terms of passenger spending, including booking and expenses, the study said the top five passengers are from Saudi Arabia, China, Australia, the United States and Kuwait. I trust this confirms that digital transactions and technology are better and safer. Some studies have shown that spending in Kuwait’s IT sector grew rapidly from a record $939 million in 2012 to $1.87 billion in 2017. I believe that technology is not a luxury, but the basis of human development with safer and faster transactions.
By Muna Al-Fuzai