High Fees Stall Saudi Small Businesses’ Digital Wallet Adoption

Saudi Arabia, known for rapid digital transformation, is embracing digital wallets for international payments. A deep dive into the latest data reveals a striking trend. While consumers, particularly younger generations, are embracing digital wallets at a pace that rivals the U.S., many larger, small to mid-sized businesses (SMBs) have considerable misgivings.

The reasons? Concerns about security, cost and transparency. Meanwhile, the smallest businesses — those typically seen as late adopters — charge ahead, making digital wallets a core part of their cross-border payment strategy. What will it take for digital wallets to close the gap between consumer enthusiasm and business skepticism?

These subjects are explored in depth in “Global Money Movement: Saudi Arabia Edition,” a PYMNTS Intelligence and TerraPay collaboration. For this data brief, we surveyed 3,664 Saudi Arabia-based consumers, including 536 who made cross-border payments in the past year. We also surveyed 63 SMBs with up to $10 million in annual revenue that engage in international transactions. The goal: to understand the shifting dynamics of digital wallet adoption in one of the Middle East’s most tech-forward economies.

Inside the data brief:

• Discover which cross-border payers in Saudi Arabia now use digital wallets — and who is holding back and why.
• Analyze usage patterns among SMBs by digging into how different types of firms are adopting the technology at different rates.
• Uncover the critical barriers to adoption cited by SMBs, including transaction tracking concerns, security doubts and high costs — worries rarely echoed by consumers.
• Explore the factors that could accelerate adoption, from instant transfer speeds to lower transaction fees, and how these drivers differ between businesses and individuals.

Ultimately, this data brief paints a nuanced portrait of a digital shift in progress. Saudi Arabia is a nation where digital wallets are not just catching on; they’re reshaping how consumers and businesses move money across borders. But the divide in adoption between consumers and businesses underscores an important challenge. For digital wallets to reach their full potential, providers must confront the operational realities and reservations of the Kingdom’s broader SMB ecosystem.

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“Global Money Movement: Saudi Arabia Edition” is based on a survey of 3,664 consumers in Saudi Arabia, including 536 who made cross-border payments within the previous 12 months, that was conducted from Sept. 6, 2024, to Oct. 23, 2024. It also draws on a survey conducted between Sept. 4, 2024, and Oct. 14, 2024, of 63 business owners and leaders at small and medium-sized Saudi businesses. These enterprises generated annual revenues of up to $10 million in 2023. The report examines the current digital wallet landscape for cross-border payments in Saudi Arabia.

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