Cash transactions are giving way to digital as the mobile payment industry is experiencing major growth in the Middle East. According to a recent survey, cashless payments are becoming more popular in Bahrain as the point of sale (POS) transaction volume has shown substantial growth.

The new data released by the Bahrain Central Bank revealed that the total number of POS transactions across the kingdom increased by 49.8% to 125.5 million in 2021. During the same period, the overall value of these payments increased annually by 34.6% to $8.5 billion.

Out of the total POS transactions, 65.6% were contactless payments. In terms of value, contactless payments accounted for 39.8% of the POS transactions.

The central bank report includes a thorough analysis of the growth of payment and settlement services in the kingdom’s banking industry over the past few years. The Bahraini payment system has seen significant change throughout the years, the central bank observed in the study.

“The growth of digital payments has been steady in recent years. It has been supported by the proliferation of new technologies and changes in consumer behavior,” the report mentioned. 

Meanwhile, by 2023, the Middle East will have almost 7 out of 10 non-cash payment transactions, a report suggested early this year.

According to SHIFT, research by the MENA Fintech Association, the banking industry has historically tended to cling to cash payments and has been slower to modernize.

However, the survey stated that by 2023, 69% of all transactions would be cashless, and digital payments will be more prevalent than cash.

Fast Company’s World Changing Ideas comes to the Middle East on 23 November 2022. Click here to know more.