Saudi consumers splashing the cash once more, says Mastercard boss

RIYADH: Saudi Arabian consumers are increasingly spending cash — and using their credit cards online — after a period of relative parsimony, the head of one of the biggest providers of consumer payment systems told Arab News.
J.K. Khalil, the general manager of Mastercard in Saudi Arabia and Bahrain, said that there has been an appreciable pickup in consumer spending in the first quarter of 2019, in contrast to the slump that followed the introduction of value-added tax last year.
Speaking on the sidelines of the Financial Sector Conference in Riyadh, Khalil said: “There are positive signals that last year’s situation is being reversed. We have seen an overall relaxation in the economy. It’s not yet back to previous levels, but there has been a positive trend reversal.”
Khalil described the upturn as a “positive single-digit increase.”
The Mastercard regional boss said that the trend would continue. “We are expecting the second quarter to be better than the first, and we are confident that will happen,” he said.
A lot of the upturn has been in the form of online transactions, he said. “We are seeing an increase not just in the physical retail space, but also online. Consumers see increasingly that cards can be used online and offline,” Khalil added.
Some 30 million debit cards are now used for e-commerce transactions in the Kingdom, Khalil said.
Mastercard’s optimistic view was echoed by several participants at the Financial Sector Conference. Finance Minister Mohammed Al-Jadaan opened the first day of the event with the surprise announcement that the Kingdom’s budget had recorded its first quarterly surplus in five years.
Mohammed Al-Tuwaijri, the minister for economy and planning, said on Thursday that unemployment was down in the Kingdom, even though there were a large number of new entrants to the jobs market.
Elsewhere at the event, which closed on Thursday, there were expressions that the Kingdom had “turned the corner” from the downturn that hit after the collapse in oil prices in 2014. One operator of a major retail chain, who asked not to be identified, said that footfall in the capital’s malls was ahead of last year, and the trend was expected to continue this year.