The Road Ahead: Visa Webinar Discusses How A Shift To Digital Can Help In The Recovery Of SMEs In The UAE With Entrepreneur Middle East Editor in Chief Aby Sam Thomas as the moderator, the discussion was led by Saeed Al Marri, Deputy CEO, Dubai SME, Madhur Mehra, MENA Head of Merchant Sales and Acquiring at Visa, and Raed Hafez, CEO of elGrocer.

As part of its #WhereYouShopMatters initiative in the UAE, digital payments leader Visa held a webinar in late June to discuss the role of digitization in helping SMEs navigate through the COVID-19 crisis. With Entrepreneur Middle East Editor in Chief Aby Sam Thomas as the moderator, the discussion was led by Saeed Al Marri, Deputy CEO, Dubai SME, Madhur Mehra, MENA Head of Merchant Sales and Acquiring at Visa, and Raed Hafez, CEO of elGrocer.

Thomas kicked off the conversation by noting how Visa's COVID-19 CEMEA Impact Tracker had found that 89% of small businesses in the UAE had noticed a decrease in average consumer spending amid the coronavirus pandemic. Citing the COVID-19 crisis as a catalyst in consumers changing "how they spend, how they shop, and where they shop," Mehra said that the Visa report had identified a three-stage process of "respond, recover, thrive" in how this behavioral change manifested itself. Mehra explained that the first few weeks of the crisis saw people reacting to, assessing, and accepting the crisis; the next stage will have them trying to figure out how they can overcome the new hurdles in their paths, and then, when normalization ensues, the last phase will be when people (and businesses) that have accommodated these changes can expect to thrive.

"Business transformation is now getting accelerated," Mehra said. "There are compelling reasons for businesses to look at alternate (digital) ways of reaching their customer segments, allowing them the same experience (of physical shopping) in selecting what they want (digitally), and completing their purchase transaction with a digital payment method." He also highlighted how businesses need to appreciate changed consumer behaviors thanks to the COVID-19 crisis. "We need to focus on online businesses enabling the buyers and sellers to transact. For instance, 80% of UAE consumers have faced a change in consumer behavior when it comes to groceries- two-thirds of them have shifted to online grocery purchases."

It is to ensure that SMEs in the UAE are informed of insights like these and give their businesses the digital edge they need to survive in the long-term that Visa launched the #WhereYouShopMatters initiative, Mehra noted. "This is a commitment from Visa to the SME community, wherein across different markets, globally, Visa has undertaken and started this journey, as a platform for making available information, education, on how a merchant can benefit and add on to their business by adopting digital tools. Through #WhereYouShopMatters we're touching multiple elements in the merchant/seller community, and this will only become stronger and evolve as we progress."

When talking about the impact the COVID-19 crisis has had on the UAE, Al Marri noted that Dubai especially was hit hard given that it's a hub for trade and a center for logistics, services, and retail. "But the government was very fast in responding to the impact, and the response was impressive," Al Marri noted. "We, at Dubai SME, were doing some groundwork with the SMEs directly, to help and guide them in navigating through this crisis. We reached out, summarized their needs, proposed a few policies to the government, and the response was positive- some of the policies were implemented immediately."

Al Marri also noted that how businesses that adopted digital had an advantage as the crisis happened, with the movement restrictions and social distancing guidelines that ensued allowing these enterprises to especially thrive. One startup that tapped into this opportunity was grocery marketplace elGrocer, and while it had primarily catered to the large retailers previously, the crisis made Hafez and his team make a conscious effort to add some of the more vulnerable, smaller retail chains and shops onto the platform. "Traditionally, ElGrocer has been known to connect the consumer to the large hypermarkets," Hafez explained. "However, we felt that it was a part of our mission to also be able to enable bringing some of the smaller chains and smaller stores; people who have specialties such as butchery or organic stores. It was about enabling online access to every small business, and getting that service to every consumer around the UAE."

A slide shared by Madhur Mehra during the webinar. Source: VISA

Speaking of market trends amid the crisis, Hafez noted how contactless payments peaked during this period. "We saw a very quick shift," he said. "Traditionally, our payment is 50% cash-on-delivery and 50% cashless; now, we're almost 80% cashless. There's a shift in our retailers too– they wanted their invoices in hard copy and payments in checks, but now electronic [modes of] communication, invoicing, and payment is the acceptable norm." At this point, Mehra noted that going digital didn't mean that people were forgetting about safety and security of their transactions. "58% of consumers, when they went online and didn't feel safe while purchasing, abandoned their shopping carts," Mehra pointed out. "We still have a lot of ground to cover as an ecosystem. 35% of this 58% who abandoned their shopping carts did actually complete the transaction, but on somebody else's website."

Stats like these underline the fact that a complete shift to digital transactions will come with its fair share of hurdles, but Al Marri, Hafez, and Mehra all agreed that this future is set to be realized sooner than later. "We're in a country of technology natives– they will now demand that every business has enabled digital payments and access," Hafez said. "Businesses will be smart to heed that call." AlMarri remained fairly optimistic and confident about the growing trend, saying, "I can say very comfortably, that most businesses are in the stage of this digital transformation. It is no longer just for the new generation." As a closing note on what businesses must do to continue the shift towards digitization, Mehra replied: "First, think about your purchase experience and payment experience together. Second, do not underestimate safety and security. Visa has got an innovation centre in Dubai where we can help merchants who want to create a unique safe experience we can co-create and develop solutions. Third, keep it simple– our parents, elders in the family, and even the youth should be able to use it."

Related: Where You Shop Matters: How Thinking Local Can Help Kickstart The COVID-19 Recovery