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Network sees boom in digital payments

Company seeks to cash in on spur in cashless solutions

Industry reports suggest that the digital payments market in the UAE is around $140 billion to $150 billon annually.

Network International, one of the biggest players in the sector, holds around 40 per cent of the market, and expects to see a strong double digit growth.

“Network International’s revenue grew by 15 per cent in constant currency to $490 million in 2023, underscoring the resilience of our business and strong growth in the UAE. Merchant payments value in the Middle East surged, driven by a 24 per cent increase from domestic consumers and a 55 per cent rise from international visitors,” Nandan Mer, Chief Executive Officer, Network International, told Khaleej Times in an interview.

The UAE has made tremendous progress and is the vanguard of digital payments in the region in every perspective, more importantly from the share of volumes as a proportion of total consumer spend, Mer stressed. “Business to business payments tend to be digital and advancing rapidly in most cases. In terms of consumer payments, cash is quite entrenched globally and in the region, and the UAE and Saudi Arabia are really at the forefront of digital payments. Saudi Arabia has made substantial investments into technology infrastructure, especially at the government level,” he added.

The UAE has progressed very well and now has advanced more than many geographies including Asian markets by putting in place infrastructure for a domestic card programme like Jaywan and for domestic P2P payments like Aani. “Very soon we will all be able to use the Central Bank Digital Currency,” Mer said.

Digital payments is not just about digitising payment flows and currencies but extending it to the entire infrastructure. “In this regard, the UAE has made substantive investments in digitisation, such as e-services for business licences, Know Your Customer (KYC) and Anti Money Laundering verifications, and more. When you connect the dots of the financial infrastructure investments that the UAE has made, the country is well-positioned to continue to be the vanguard of that shift of cash to digital payments. The volume growth in the UAE leads the region,” Mer said.

While cards provide the bridge in an e-commerce world as well as the physical realm to connect buyers and sellers, a wallet, subsumes cards and physical commerce into a digital world. And wallets have different layers for payment, financial services, and lifestyle, which would include hospitality, mobility, arts and more.

Network International recently partnered with Ant International on the wallet is because of the potential that Ant has delivered in China, India, Japan, South Africa, and Brazil. “They have demonstrated convenience with a wallet from making P2P payments, daily commerce, banking, investments and more. They have basically created a super-app that serves 600 million consumers in China and through their partnerships, another half billion people outside of China. The purpose of our partnership with Ant International is bring that capability to the region – the UAE, extending to the Middle East and Africa. Network will provision the technology that is already present in the other markets in which Ant International operates,” Mer said.

Further plans for wallet development and the go-to-market strategy will be decided with our partners, namely banks, retailers, telecom companies and fintechs. “Within each we will build technical innovations and additional capabilities, adding to the number of super-apps in the market,” Mer said.

Network International will not be looking to launch a super app. “But what you could see is super apps out there that are powered by Network in collaboration with Ant International. Ant International is building the software, which we will repurpose for our region. We are also enabling that software to interface with all our partners that provide the Super app capabilities and then the distribution, branding, and the servicing of the customers that are part of that super app will be done by banks, telecom companies, and fintechs,” Mer said.

The company uses AI for operational efficiency internally in the company for its back office operations including straight through processing, fraud risk scoring, credit risk scoring, and more. “Network is already using many other AI applications for its own purpose, and to secure customers which are banks, financial institutions, and telecom companies, which they use to service their customers better,” Mer said.

The core of any super app is machine learning and AI engine. “To give you an example: If you are booking a ticket from Dubai to some European city, the super app will give you personalized information based on your profile, such as recommendations of activities to engage in when travelling, offer restaurant choices, and more to give you a sense of familiarity and help you navigate through the city,” Mer said.

Cybersecurity is another area where the company uses AI substantively, to predict attacks. “As you can imagine, as a payment company, we get a lot of attention from people who are looking to penetrate, our cyber security. Like any other cybersecurity architecture, we take the utmost precautions and build multiple layers of defense to thwart attackers,” Mer said.