International card schemes tap into MEA boom, RBR

Middle East and Africa is the world’s fastest growing payment cards region, according to RBR research which forecasts continued strong growth and highlights significant opportunities for the international card schemes.

The number of cards in issue in the Middle East and Africa (MEA) increased by 13% to 611 million in 2015, making it the world’s fastest growing region. Large unbanked populations mean that many people do not yet have a payment card. RBR forecasts that the number of cards in the region will rise to 910 million by the end of 2021.

By far the largest market in the region is Iran, where all payment cards are domestic-only, as a result of the ongoing imposition of international sanctions. Domestic schemes are also present in Israel, Morocco, Nigeria and Saudi Arabia. Domestic scheme cards are sometimes favoured because of their lower issuing costs – in Morocco, for example, Centre Monétique Interbancaire (CMI) cards are frequently issued as entry-level products.

Mastercard and Visa make up a large and growing share of the remaining cards in the region outside of Iran and they have made notable gains in Nigeria and Saudi Arabia. This is through both organic growth and agreements for their brands to be added to domestic scheme cards to enable cardholders to use them outside the country of issuance. Cards featuring both a domestic and international brand were most recently launched in Saudi Arabia, where “mada” debit cards were introduced by the Saudi Payment Network (SPAN) in 2015.

RBR’s Chris Herbert says: “International schemes are using various strategies to take advantage of the fast growth in the Middle East and Africa and they will continue to increase their share in most markets. Nevertheless, ongoing sanctions against Iran mean that domestic schemes are likely to be the only cards present in that country for the short-term at least.”