Cashless

CASHLESS
FRAMEWORK
REPORT
Smart Dubai
CASHLESS FRAMEWORK REPORT
TABLE OF
CONTENTS
01. The Framework 04. Governance
02. Definition & History 05. Technology
03. Benefits 06. Culture
FRAMEWORK
• What do we mean by cashless?

• How do we measure cashless?
What?
Definition & History • History of the cashless movement
• Measurement and payment experiences
Benefits Why? • Why should we go cashless?
• The role of stakeholders in enabling

cashless societies
Governance
Technology
• Key regulatory and legislative

initiatives fostering the transition to
Culture
digital payments
How? • Integral cashless payment experiences
and systems
• Cash and cashless cultural and
societal practices
• Challenges
Source: Smart Dubai

Analysis
DEFINITION & HISTORY
CASHLESS FRAMEWORK REPORT / DEFINITION & HISTORY
WHAT IS A
CASHLESS
MOVEMENT
A move towards, and implications of, a society where
payments are made with means other than tangible cash -
in other words legal tender (money) exists, is recorded, and
is exchanged in forms other than tangible cash.
Source: Smart Dubai Analysis

CASHLESS QR Code Scans
ATM Transactions
PAYMENTS NFC Mobile

Payments
Direct Debit Authorization
Digital Transfers M&E Payments

Cards at POS
E-Cheque

TIMELINE
1960’s 1990’s
1st move away from Electronic banking became
cash with banks; common, and exponential
banks convincing growth in use of checks. 2000’s
employers to use Rise of non-bank digital
direct deposit. payment platforms such
as Paypal. In 2009, Venmo
and Square were launched
enabling mobile to mobile
money transfer.
2010’s
Cash became actively
disfavored in many
transactions, and often
looked at with suspicion.
2011 2012 2016 / Present

Launch of iZettle for Launch of Swish, Several leading digital wallets
small merchants to smartphone-to-phone Spread of digital payments
accept credit cards. payment system. promoting regulations.

AROUND THE WORLD

What do countries that are ahead in ‘cashless’ have in common?
Sweden
UK
Singapore
Australia
Source: Nam , ipsapitatur sum dust, que el
• High progress in the transition to cashless • High-end and technologically advancedeossit aperum re, ut as ratur sedi dolum qu
• Undertaken regulatory initiatives to facilitate the payment service providers

transition to cashless • Highly developed regulatory landscape
• Movement enabled through regulated, efficient and • Proactive supply side push for digital
seamless technologies payments
• Ready demand side pull for digital payments
Singaore
CASHLESS FRAMEWORK REPORT / UAE
DEFINITION & HISTORY Australia
UK CIC/GDP ATM withdrawls
Sweden
CASH 12.5
(%)
300
(Billion USD)
10 9.8
9.7 225
9.1
8.7
7.5
150
5.9 6.1
5.6
5.0 5.1
4.6 4.7 4.5
4.4
3.7 3.9
3.6 75
2.5
2.1
1.7
1.4 1.3
0 0
2014 2015 2016 2017 2014 2015 2016 2017
Payment Diary Surveys

• Older generation still
(% of people who used cash in their last transaction)
holds more trust in cash
• High unfamiliarity with digital
45 payments
37
• Cash is used both as a means of
payment and a store of value
• Cash printed does not necessarily
20 go back to the system
• Increased global economic
activities (specially tourism
and investment) are still often
done in cash
Australia Sweden UK
CIC = currency in circulation in a country is the value of currency or cash (banknotes and coins) that has ever
been issued by the country’s monetary authority minus the amount that has been removed.
Source: B ank of International Settlements

UA E D ata from UA E Central B ank Reports
CASHLESS FRAMEWORK REPORT /
DEFINITION & HISTORY
CASHLESS Cashless Payments/GDP 2014 & 2017

(Multiples)
44.9 2017
40.1 2014
17.2
9.7 9.7 9.6 9.9 10.2

8.1
7.0
4.1 4.1
2.8 2.7 0.0065
0.0065
Australia Singapore Sweden UK Japan US Spain UAE
Although absolute value and volume of Cashless Payments increased over

the past few years, Cashless Payments as a multiple of GDP varies due to
significant fluctuations in GDP over the same period.
Reasons
• Increased number of cashless payment channels
• More number of transactions are done digitally but of lower value
• Younger generation and digital payment savviness
Source: B ank of International Settlements

UA E D ata from UA E Central B ank Reports
Category-wise penetration of eCommerce
E-COMMERCE MARKETS compared to overall volumes UAE vs.
benchmark markets
March 2018 - February 2019
EMERGING MARKETS MATURE MARKETS UAE MARKET

Dominant segments Dominant segments Dominant segments
• Government • Professional Services • Government
Services/Education • Government Services/Education
• Airlines Services/Education • Airlines
Source: Visa transaction data, Visa e-com m erce report

B enchm ark em erging markets: Brazil, South Africa, Malaysia
B enchm ark m ature markets: USA, Canada, UK, Sw eden,
Australia, Singapore
E&M PAYMENTS
Volume of International e–Payment & m–Payments Retail eCommerce sales Worldwide — 2016/2021
transactions (Trillion Dollars)
76.5
Transactions
e–Payment
(Billion)
Source: Visa transaction data, Visa e-commerce report

% change
% of total retail sales
Online payments continue to grow at a

steady pace across markets and non-bank
Transactions
m–Payment
players are now dominating the payments

space, carving out a niche for themselves
(Billion)
Source: World Payments Report
E-commerce includes retail sales, travel sales, digital dow nloads products or services ordered using the internet via any device, regardless of the
method of payment or fulfillment; excludes travel and event tickets; Mobile payments or m -payments are defined as a form of payment w here the
mobile phone is used as a payment mode – not just as an alternative channel to send the payment instruction – and the payment information flow
takes place in real-time; Chart numbers and quoted percentages may not add up due to rounding
BENEFITS
CASHLESS FRAMEWORK REPORT / BENEFITS
NET BENEFITS
GOVERNMENT
$0.5 billion annually

added for Dubai Government
• Increased government revenue generated

from recapturing the grey economy
• Increased government revenue generated
from additional business revenue
• Ease of monitoring
• Increased sense of trust in government
• Generation of more insightful data
• Government efficiency savings
• Criminal justice cost savings from
reduced crime; and
• Toll road and transit agency cost savings
Source: visa-cashless-cities-report
2017
Calculations are done based on
GDP and Population data of 2015
NET BENEFITS BUSINESSES

added for businesses
• Costs associated with processing

incoming payments
• Labor savings associated with processing
incoming and outgoing payments
• Time savings from consumer point-of-sale
transactions
• Better cash flow management
• Ease of monitoring
• Generation of more insightful data
• Lowering Cost of KYC Process when opening
a bank account
• Increased business revenues; and
• Float costs (time for money to actually be
available in the bank accounts - negative
indicator)
2017
NET BENEFITS
INDIVIDUALS
added for individuals
• Time savings in banking, transit and retail

transactions
• Float savings
• Savings from avoidance of late payment fees
• Savings from reduced crime
• Increased convenience
• Improved budgeting and expense tracking
• Better data to build credit profiles
2017
DIRECT NET BENEFIT
$2.2 billion added to the city

3.1% increase in GDP

added for governments
$1.5 billion annually $0.2 billion annually

added for businesses added for individuals
2017
CATALYTIC BENEFITS As cities increase use of digital payments, the positive

impacts go well beyond the direct net benefit to
individuals, businesses and governments. Below are
(2017 - 2032) * forecasts for four catalytic benefits between 2017 and
2032
Wage Growth Productivity Growth Average Annual GDP Additional Jobs Created
(% increase on top of baseline) (% increase on top of baseline) Growth Rate increase (bps) (Additional jobs on top of baseline)
71400
65.4
66100
0.7 57
0.73
0.6
0.62
0.33
31
28700
0.05 0.11 0.11 0.08 0.12

18900
0.01 0.01 13.1 15300
10.8
-0.01 -0.02 5400
4.7
1.7 1700
Hong KongX
Dubai
Singapore
Singapore
Singapore
London
London
London
London
Dubai
Tokyo
Dubai
Sydney
Singapore
Sydney
Sydney
Sydney
Stockholm
Stockholm
Stockholm
Dubai
Hong Kong
Tokyo
Tokyo
Tokyo
Hong Kong
Hong Kong
Stockholm
2017
*if 100% cashless is achieved
CASHLESS FRAMEWORK REPORT / GOVERNANCE
GOVERNANCE
STAKEHOLDERS
REGULATORY
INITIATIVES
FOCUS
AREAS

Oversight Body
Legislative/ Regulatory Entities
STAKEHOLDERS Sector Associations/ Industry Bodies
Payment Service Issuers &

Providers Acquirers
Government Private Sector

Merchants Merchants
Customers

CASHLESS FRAMEWORK REPORT/
GOVERNANCE
Oversight Body
STAKEHOLDERS • Foster collaboration • Build security and trust
• Develop cashless strategy, policy and • Monitor and incorporate leading edge
future foresight payment developments
• Identify initiatives to promote innovation • Oversee transition to cashless and
measure results
SWEDEN AUSTRALIA UK SINGAPORE

Oversight Body
Swedish Retail Australian Payments European Payments Singapore Payments

Payments Council Council (forum for PSB Council Council
to consult with industry)
European Payments National Payments
Council Strategy Council*
Payments System Board proposed
(PSB)*
UAE
Central Bank of the UAE, Payment

Systems Oversight Unit
Department of Finance in
Dubai Government,
government payments * One of the two boards of Reserve
Bank of Australia
department Future of Finance (June 2019) by
Bank of England

GOVERNANCE
Legislative Entities Regulatory Entities
• Enact and change • Control the money supply in the economy
STAKEHOLDERS laws • Regulate financial institutions

• Issue financial institutions licenses (including Fintech)
• Develop regulations to promote innovation, consumer
protection, security and skills availability
Legislative* Legislative Legislative* Legislative

• Riksdag • Commonwealth • The Parliament of the • The Parliament of the
Parliament United Kingdom Republic of Singapore
Legislative/ Regulatory Entities Regulatory Regulatory Regulatory Regulatory
• Riksbank • Reserve Bank of • Bank of England • Monetary Authority of
• Financial Supervisory Australia • Prudential Regulation Singapore
Authority • Australian Prudential Authority (large firm • Competition and
• Swedish Competition Regulation Authority level- independent Consumer Commission
Authority • Australian Competition & subsidiary of BoE) of Singapore
• Swedish Consumer Consumer Commission • Financial Conduct
Agency Authority (entire finance
sector)
• Payment Systems
Regulator (independent
subsidiary of FCA)
• Competition and Markets
UAE Authority (CMA)
Legislative
• Cabinet
• Federal National Council
Regulatory *Sweden and UK, being EU members,
also have EU Commission (proposing
• Central Bank of the UAE legislation) and European Parliament
and Council of the European Union
jointly enacting EU laws.
• Ministry of Economy (supported by The Higher
Committee on Consumer Protection & UAE Payment Systems Regulator (UK) is
a subsidiary of the FCA but, as an
Competition Committee) independent economic regulator,
has its own statutory objectives and
• Dubai Depts. of Economic Development management structure

• Department of Finance in Dubai Government
(for government payments)
GOVERNANCE
Sector Associations / Industry Bodies
STAKEHOLDERS • Represent the voice of the sector
• Support and promote policies and initiatives that balance both the interest of
financial institutions, and the wider public benefit
• Provide industry code of conduct, research, policy expertise and input, thought
leadership and advocacy
• Conduct activities to promote the sector
Swedish Bankers’ The Australian Banking UK Finance The Association of Banks

Association Association (formerly British Bankers in Singapore
Association
Swedish Consumers’ Australian Payments
Association Network Singapore Fintech
Payments Strategy Forum
Sector Associations/ Industry Bodies Association
Swedish FinTech Open Banking
Association Implementation Entity
(established by CMA)
UAE
UAE Banks Federation

GOVERNANCE
STAKEHOLDERS Payment Service Providers

• Provide services for electronic payments
• Establish relationships and connect to multiple
NON-EXHAUSTIVE
acquiring banks, card and payment networks
• Provide value added services
Payment Service
Providers*
UAE

* Includes payment gateways & netwroks
GOVERNANCE
STAKEHOLDERS Issuers Acquirers

• issue payment instruments • contract with the merchants
• act as the middle-man for the • maintain the merchant’s bank account
customer and the payment • pass the merchant’s transactions to issuers to
network receive payment
Issuers &
Acquirers

* Includes payment gateways & netwroks
GOVERNANCE
Private Sector Merchants

STAKEHOLDERS Government Merchants
• Provide services to other government • provide goods and services that
entities, private sector and individuals require payment (payees)
Customers
• pay for goods and services provided by
merchants (payors)
Government Private Sector UAE

Merchants Merchants
Customers
Private
Sector

GOVERNANCE
REGULATORY Blueprints
& INDUSTRY
INITIATIVES
Legislations
Regulations
Key Regulatory and Industry
Initiatives utilize a set of
levers for change
Policies
Standards
Guidelines and
Frameworks

POLICY & GOVERNANCE

FOCUS AREAS
Consumer Protection Innovation Competition Resilience
To protect consumers To boost innovation To achieve competitive To control and

and to enhance their and level the playing and stable markets alleviate risks
confidence field
Ad-hoc / Formal Traditional Pervasive Monopoly Highly Disruption Proactive

Provider policies and payment Fintech in payment competitive and reactive security and
dependent mechanisms systems in innovation markets payment resilience in resilience
addressing in place place & related initiatives markets payment mechanisms
of consumer
issues

GOVERNANCE
CONSUMER Topics addressed in existing initiatives

PROTECTION • Duties of account holders and users
• Reporting of unauthorized access
• Liabilities of users and providers
• Handling erroneous transactions
• Clarity, transparency and completeness in

information disclosure
• Dispute resolution and redress
• Consumer data rights and data protection
• Addressing wind-down of PSPs (e.g. P2P)
• Marketing restrictions and consumer

awareness for risky payments (e.g. P2P
services, cryptoassets, etc.)
• Financial inclusion (addressing discrimination

against consumers)
• General stipulations of the consumer

protection law

GOVERNANCE Stakeholder Initiative name
Australia
CONSUMER • AusPayNet
• Parliament
• CNP (Card Not Present) Fraud Mitigation Framework
(AusPayNet)
• Austrailian Payments
PROTECTION Council (APC)
• Austrilian
Competition &
• Consumer Data Right* Act (Parliament)
• Competition and Consumer (Consumer Data) Rules (2019)
(ACCC)
Consumer • Payment surcharges (ACCC)
Commission (ACCC) • Financial Crime Prevention & Detection and Consumer
Protection (TBD)
• Guiding principles for financial inclusion (APC) - TBD
• Technology Impact Assessment (TIA) Guidelines (APC) - TBD
Singapore
• Singapore Payments Council
• E-Payments User Protection Guidelines
• MAS
• Consumer Protection (Fair Trading) Act
• Competition and Consumer
Commission of Singapore
European Union
• European • PSD2 (consumer protection, complaints handling, prohibits
Parliament and surcharging, reduce consumers’ liability, unconditional refund
European right for direct debits, etc.)*
Commission • Consumer Rights Directive
United Kingdom
• FCA • Loan-based (‘peer-to-peer’) and investment-based

• Bank of England crowdfunding platforms (2019)
• Customer Experience Guidelines & Checklist (part of Open
Banking initiative)
• Consumer Rights Act
Sweden
• Swedish Retail Payments • A scenario analysis of payments at points of sale and
Council withdrawals from ATMs in the event of disruptions to the card
• Riskdag systems
• Swedish Consumer Agency • EU Directive nationalized
Source: https://www.dentons.com/en/
• Swedish government expected to pass law requiring all banks to
insights/alerts/2019/august/8/australian- handle cash
government-passes-consumer-data-right-
legislation-on-1-august-2019 United Arab Emirates
https://ec.europa.eu/commission/
presscorner/detail/en/qanda_19_5555 • FNC, Cabinet, Ministry of Economy • Federal Law No. 24 of 2006 on Consumer Protection
https://www.cashmatters.org/blog/ • CBUAE and MoE – The Higher • Federal Law No. 14 of 2018 Regarding the Central Bank &
swedish-government-expected-to-pass-
law-requiring-all-banks-to-handle-cash/
Committee for Consumer Protection, Organization of Financial Institutions and Activities
• DED - Commercial Compliance & • DED in each emirate deals with consumer rights
Consumer Protection
GOVERNANCE
INNOVATION Topics addressed in existing initiatives

• Real-time payments (entire payment process in
real time)
• Adoption of new technologies in payment

systems (e-wallets, QR codes, etc.)
• Open Banking (interoperability, account

information and payment initiation services
disrupting incumbent financial institutions)
• Innovative and disruptive Fintech services

(AI/ML) - AI based personal finance
and wealth management and planning,
conversational commerce, invisible payments,.
fraud detection and prevention, etc.
• Central Bank Digital Currencies
• Digital Ledger Technology in payment

(wholesale, retail)
• Cryptocurrencies
• Bank as a Service, Conversational Commerce
• From Open Banking to Open Finance

INNOVATION Australia
• Australian • RITS/ISO20022 (LVPS – RTGS)
Payments Council • New Payments Platform (NPP) (RPS – RTGS)
• PSPs • QR codes and Osko RT P2P payments over NPP
• Principles for data sharing
• Consumer Data Right Law (enables Open Banking for
reading data)
• Interoperability Vision & Roadmap (TBD)
Singapore
• Singapore Payments Council • MEPS (LVPS – RTGS) and FAST (RPS & FPS – MN)
• Monetary Authority of • PayNow (C2C & B2C payments), PayNow Corporate (B2B
Singapore (MAS) payments), SGQR (C2B payments), UPOS (Unified POS),
• PSPs APIX (API Exchange), Project Ubin (CBDC)
European Union
• European Central Bank • TARGET – TIPS

• European Parliament • SEPA Schemes (credit transfer, direct debit, cards, cash,
and European mobile, proxy lookup mechanism)
Commission • PSD2 (account information initiation and payment
• PSPs initiation services)
United Kingdom
• FCA, Bank of England • CHAPS (LVPS – RTGS), FPS (RPS – MN)
• Open Banking • Open Banking (initiated by CMA)
Implementation Entity • Guidance on cryptoassets (2019)
• Competition and Markets • A blueprint for a new RTGS service for the United Kingdom
Authority (CMA) (BoE)
• PSPs
Source: https://ec.europa.eu/info/business- Sweden
economy-euro/banking-and-finance/consumer-
finance-and-payments/payment-services/single-
euro-payments-area-sepa_en • Riksbank • RIX (LVPS - RTGS) and Bankgirot (ACH & Settlement services
https://australianpaymentscouncil.com.au/
• PSPs for retail payments, BIR - Payments in Real Time)
announcements/
https://apixplatform.com/marketplace/la • Swish (C2B and C2C mobile payments – consortium of banks)

https://www.mas.gov.sg/schemes-and-initiatives/
Project-Ubin
• Klarna (online payments)
The Reserve Bank Information and Transfer
System (RITS) is Australia’s high-value settlement
• iZettle (Retail SME payments)
system based on RTGS • E-Krona (CBDC)
https://www.dentons.com/en/insights/
alerts/2019/august/8/australian-government-
passes-consumer-data-right-legislation-on-1-
United Arab Emirates
august-2019
• Central Bank of • UAEFTS (LVPS – RTGS)
Note: LVPS denotes Large Value Payments
System, RTGS denotes Real Time Gross
the UAE • UAE Saudi digital currency project (Aber)
Settlement, RPS denotes Retail Payment
System, FPS denotes Fast Payment System,
• PSPs • Regulatory Framework for Stored Values and Electronic
MN denotes Multi-netted, SEPA denotes Payment Systems
Single European Payment Area, PSD denotes
Payment Services Directive • eWallet
GOVERNANCE
COMPETITION
Topics addressed in existing initiatives
• Payment services providers authorization
(licensing) requirements (governance,
ownership and management, business plan,
internal control, risk management, capital, etc.)
• Payment systems oversight (designation of

payment systems, imposition / cessation /
revocation of access regime, shareholding
conditions, auditing, inspection, authority
notifications, reports submission, etc.)
• Open Banking
• Interchange fees, fees among financial

institutions, PSPs, etc.
• Competition and regulatory authority

payment markets reviews and
recommendations
• General stipulations of the competition law

COMPETITION
Australia
• Australian Parliament • Payment Systems (Regulation) Act 1998
• Payment Systems and Netting Act 1998
• Competition and Consumer Act 2010
• Productivity Commission Report on Competition in the
Australian Financial System
Singapore
• Singapore Parliament • Payment Services Act (2019)
• Monetary Authority • Payment Systems Oversight Act
of Singapore • Competition Act and Guidelines
• Competition and • PayNow Corporate (B2B payments)
Consumer • SGQR (C2B payments)
Commission of • UPOS (Unified POS)
Singapore • APIX (API Exchange)
• Project Ubin (CBDC)
European
EuropeanUnion
Union
• European Parliament • PSD2 (translated to national laws)
and European • EU Competition Commission (anti-trust laws)
Commission • Interchange Fee Regulation
UnitedKingdom
United Kingdom
• FCA • Financial Services (Banking Reform) Act 2013
• CMA • Loan-based (‘peer-to-peer’) and investment-based
crowdfunding platforms (2019)
• The Payment Services Regulations (FCA)
• Payment Card Interchange Fee Regulations (2015).
• Open Banking initiated by CMA (via the report Retail Banking
market investigation)
• UK Payment Systems Regulator Market Review of Card-
Acquiring Services
Sweden
• Swedish Competition • Terms of Access to Payment Systems (SCA)
Authority (SCA) • Swedish Banking and Financing Business Act (BFBA)
• Riskdag
United Arab Emirates
Source: https://europa.eu/rapid/press-release_IP-
• Central Bank of the UAE • Regulatory Framework for Stored Values and Electronic
19-582_en.htm
• Ministry of Economy Payment Systems
https://eur-lex.europa.eu/legal-content/EN/TXT/
PDF/?uri=OJ:JOL_2015_123_R_0001&rid=1
• Federal Law No. 14 of 2018 Regarding the Central Bank &
Organization of Financial Institutions and Activities
GOVERNANCE
RESILIENCE
Topics addressed in existing initiatives
• Cybersecurity and resilience
• Electronic identification and trust services
• Distributed ledger regulations
• Financial crime detection and prevention

• Prevent illicit activity by cryptoassets
• AML / CFT regulations
• KYC regulations
• Fraud regulations
• Other financial stability and risk regulations

RESILIENCE Australia
• Australian Payments • Resilience Policy Recommendations (TBD)
Council • Principles and guidelines for secure innovation (TBD)
• Financial Crime Prevention & Detection and Consumer
Protection (TBD)
Singapore
• Singaporean Parliament • Payment and settlement systems (Finality and Netting) act
• MAS • Supervision of Financial Market Infrastructures in Singapore
• Singapore Payments (MAS)
Council • MAS’ Framework for Impact and Risk Assesment of Financial
Insitiutions (MAS)
• New Rules to Strengthen Cyber Resilience of Financial Industry
(MAS)
• Guidelines on Risk Management Practices – Technology Risk
Management (MAS)
• Stored Value Facility Guidelines
• Notice on Cyberhygiene
European Union
• European • GDPR
Parliament and • PSD2 (stronger authentication, security incidents reporting, etc.)
European • EC EU Cybersecurity Act
Commission • Country specific resilience and cyber-security regulations
United Kingdom
• The Parliament of the United • Data Protection Act (replaced by GDPR now)
Kingdom • UK Minimum Cyber Security Standard
• UK Cabinet Office • UK National Cyber Security Strategy 2016-2021
Sweden
• Riksdag • GDPR (EU level)
• Swedish Act on Information Security Regarding Providers of
Critical Infrastructure and Digital Services (Parliament)
Source: https://ec.europa.eu/info/business-
economy-euro/banking-and-finance/consumer- United Arab Emirates
finance-and-payments/payment-services/single-
euro-payments-area-sepa_en
• Central Bank • Principles for Financial Market Infrastructure (PFMI)
https://australianpaymentscouncil.com.au/
announcements/ Assessment Methodology (2014)
https://apixplatform.com/marketplace/landing • Risk Management Framework Regulation and Standards
https://www.mas.gov.sg/schemes-and-initiatives/
Project-Ubin (2018) for banks
TECHNOLOGY
Payment
Experiences
Payment
Systems

CASHLESS FRAMEWORK REPORT/ TECHNOLOGY
ATM TRANSACTIONS DEFINITION

An automated teller machine (ATM) is an
electronic telecommunications device
that enables customers of financial
institutions to perform financial
transactions, such as cash withdrawals,
ATMS per 100,000 Adults (2017)
deposits, transfer funds, or obtaining
account information, at any time and
162.0
without the need for direct
interaction with bank staff.
128.13
HISTORY
ATMs were first operational in 1966 and
developed from bankers’ needs in Japan,
65.16 65.51 Sweden, the United Kingdom, and the
United States. The first version of the
31.98
ATMs was a Japanese device called the
“Computer Loan Machine” supplied cash
as a three-month loan at 5% p.a. after
inserting a credit card.
Australia Sweden UK Singapore UAE
Despite their cash dispensing facility,
ATMs, in the short-term, are considered
Digital Transactions enablers of Cashless Societies due to the
• Pay Utility Bills facility of performing several other digital
transactions. However, in the long term,
• Bank Transfers
and with the increase of digital savviness
• Pay Insurance Premium and mobile digital transaction channels, it
• Recharge Mobile is expected that spread and availability of
• Top-up Toll Gate Accounts ATMs will decrease.
Source: Bank of International

Settlements
UAE Data from UAE Central Bank

Reports
E&M PAYMENTS DEFINITION

E-payments are defined as digital
payments that are made over the internet
Volume of International E–Payment & M–Payments Transactions for e-commerce activities. The largest
segment of e-payments is the consumer-
to-business (C2B) payments, which are
E–Payment Transactions M–Payment Transactions used mainly for goods purchased in online
(Billion) (Billion) store.
Mobile payments or m-payments are

76.5
defined as a form of payment where the
mobile phone is used as a payment mode,
not just as an alternative channel to send
the payment instruction, and the payment
information flow takes place in real-time.
Source: World Payments Report
The number of electronic payment

transactions is expected to decrease due
to the growing acceptance and adoption
of mobile payments.
DIRECT DEBIT AUTHORIZATION

DEFINITION
Direct Debit is the collection of an agreed
amount from a bank/building society
Value of Direct Debit as ratio of GDP account by a service user, on request and/
(multiples) 2014 & 2017 or authorization. Direct debits are typically
3.5 used for recurring payments, such as
3.4
2017 credit card and utility bills, where the
2014 payment amounts vary from one payment
to another.
The utilization of Direct Debit

Authorization varies from one country
to another, mostly based on financial
habits, easy of setting up and canceling
the authorization and the strength of the
0.6 0.6 regulatory frameworks around it.
0.4
0.2 0.2 0.1 0.1
The UAE Direct Debit System was
established in 2017, and has processed
Australia Sweden UK Singapore UAE 13.4 million presented claims during 2018
valued at AED 57 billion. This was an
increase of 45.4% in volume and 45.1% in
value from the year 2017.
It is expected that Direct Debit will remain

an integral part of cashless payment
systems, specially with the expected
development of technological and
regulatory infrastructure enhancing the
process.
Settlements
UAE Data from UAE Central Bank
Reports
CARDS AT POS
POS Terminals 2017 Total Number of Cards
(thousands) (thousands) 2014-2017
178,869
180,219
DEFINITION
175,630
174,25
2417 2017
A point of sale terminal (POS terminal)
2016
is an electronic device used to process
2015
2014
card payments at retail locations. A POS
terminal generally does the following:
66,602
69,624
69,453
64,800
64,699
59,688
54,526
49,834
960 Reads the information off a customer’s
20,905
credit or debit card.
24,932
21,329
22,100
256 219
UK Australia Singapore Sweden UK Australia Singapore Sweden

HISTORY
The first electronic cash registers goes
back to 1973, developed by IBM.
UAE Number of cards in circulation
(millions)
Credit
Debit
11.8
11.2
Steady growth in POS terminals and cards
10.5
Prepaid
9.4
9.6
8.9
8.9
issuance in the UAE to support both the
8.4
8.0
8.1
7.7
7.7
7.3
6.6
demand and the supply sides. However,
6.3
6.0
5.7
5.4
with the rise of other digital payment

channels (e.g NFC Payments and QR
Codes), POS terminals may not exist at all,
2012 2013 2014 2015 2016 2017 QR code or other future alternatives may
become widely adopted
UAE Number of POS Terminals
(thousands) 179.8
162
141
105.3
80.1 91.8
Settlements
UAE Data from UAE Central
Bank Reports
2012 2013 2014 2015 2016 2017

DIGITAL TRANSFERS
DEFINITION
Wire transfer, bank transfer or credit
transfer, is a method of electronic funds
Values of Credit Transfer as ratio of GDP transfer from one person or entity to
(Multiples) 2014 & 2017 another. A wire transfer can be made from
one bank account to another bank account
43.6
or, recently, through Digital Wallets.
2017 Different wire transfer systems, in different
2014
38.8 countries, and operators provide a variety
of options relative to the immediacy and
finality of settlement and the cost, value,
and volume of transactions.
HISTORY
The first widely used service
for wire transfers was launched
by Western Union in 1872 on its
existing telegraph network.
5.9 7.0
4.9 5.0
3.7 3.8
0.6 0.8
Constant increase of credit transfer over
Australia Singapore Sweden UK UAE the years, specially with a rise in demand
and supply for real-time transfers.
Source: Bank of International Settlements

UAE Data from UAE Central Bank Reports
E-CHEQUES
DEFINITION
Values of Cheques as Ratio of GDP An electronic check or e check, is a form of
(Multiple) 2015-2017
payment made via the Internet, or another
1.61 2017 data network, designed to perform the
1.49 1.47 2016 same function as a conventional paper
2015 check.
0.75 0.68
0.62
0.33 0.32
HISTORY
0.0009
0.0007
There is early evidence of
0.001
0.24
using cheques. In India, during
the Maurya Empire (from 321
Australia Singapore Sweden UK to 185 BC), a commercial
instrument called the adesha
was in use, which was an order
Total Value of Presented Cheques on a banker desiring him to
(AED Trillion) pay the money of the note to a
third person.
1.65
1.60
1.55
1.50
1.45 Traditional cheque usage continues to
1.40 drop globally due to rise of
1.35 alternative acceptable guarantees,
1.30 such as e-cheques and Direct Debit
1.25 Authorities.
1.20
2013 2016 2017

History was deducted from Reserve Bank of
Endia
DEFINITION
QR SCANS QR code payments are performed by
scanning a QR code from a mobile app.
Funds are either “pushed” from the
consumer to the merchant or “pulled” by
the merchant from the consumer.
FACTS
Scanning a QR code is considered to be
• Providers determine how to very convenient and easy for
customers. QR codes also eliminate the
execute, clear and settle the
need for PoS terminals, which can be a
payment without disrupting cost burden for merchants.
customer experience
• Initiate payment for card and non-
card transactions
• Enable acceptance across variety Alipay is collaborating with Finland’s
of payment rails ePassi and Pivo, Norway-based Vipps,
Spain’s MOMO, Portugal’s Pagaqui, and
• Push payments into the bank’s
Austria’s Bluecode to adopt a unified
back office environment QR code in a bid to bridge the region’s
• Standardize payment information fragmented mobile payment landscape.
for acceptance and processing All the six digital wallets have five million
users combined and around 190,000
merchants in their payment networks in
Europe.
Fifteen million small and micro-merchants

in China use Alipay QR code payments
NFC MOBILE PAYMENTS
FACTS
DEFINITION
• Accepting NFC payments is NFC payments are contactless payments
easy and convenient that use near-field communication (NFC)
technology to exchange data between
• Mobile payment technology readers and payment devices like Apple
is designed to be stable, Pay and Android Pay eWallets or EMV
safe, and secure chip cards.
• Paying by smartphone is the

new consumer normal Mobil was one of the most notable early
• Accepting mobile payments often adopters of a similar technology, and
deepens customer engagement offered their "Speedpass" contactless
payment system for participating Mobil gas
• The future is commerce-on-the-
stations as early as 1997.
go, and the future is now
• Payments under an “honor-all-
wallets” scenario
• NFC equipment is priced right for
small merchants
Source: European Payments Council - Mobile

proximity payments
WorldPay – 7 things to know about NFC Payments
PAYMENT SYSTEMS
Countries, including the UAE, have different architectures and breakdowns Country Fast Payment Inter-PSP Settlement
of Cashless Payments, with necessary functionalities in common. System Model
EXAMPLES Australia
• ATM Networks NPP Real-Time
• Cheque Clearing Systems

Singapore
• Fast Payment Systems
FAST Deferred-Net
• Fund Transfer Systems (LVPS-RTGS)
Sweden
Bit/Swish Real-Time
However, the biggest distinction propelling transition
UK
to cashless payments, is the existence of a Fast
Payments System. The same does not yet exist in the FPS Deferred-Net
UAE.
Mexico
SPEI Real-Time
PSP Switzerland
Payment Service Providers
Twint Deferred-Net
DEFERRED NET
A net settlement system where final settlements occur between participating
banks at the end of a predefined settlement cycle when the net obligations UAE
between participants are calculated and presented to the settlement agent
for settlement. Not Yet Not Yet
Available Available
Source: BIS Country Red Books
UAE analysis from discussion with central
bank and synthesis from UAECB Reports
CASHLESS FRAMEWORK REPORT/CULTURE
CULTURE
DEMOGRAPHICS
TRUST
HABITS
OTHERS

CASHLESS FRAMEWORK REPORT/ CULTURE
The younger the population is the more it tends to
DEMOGRAPHICS be technologically savvy and adaptable to change in
payment systems
Breakdown of UAE population

Average Age Around The World
(Demographics)
Age Group Women Men

0-14y 0.69 million 1.36 million
65y+ 0.11 million 0.14 million
Source: W AM, January 11, 2018
45+
40-45
35-40
% of Population Using Internet by Age &
30-35 Country (Both sexes, Users of internet over 3
25-30
months period, 2017)
20-25
14-20
120 16-24
110
Source: CIA W orld Factbook 2018 est. 100 26-64
90 66-74
80
70
Average Ages 60
50
40
UAE 30.3 Australia 38.7 30
20
UK 40.5 Singapore 34.6
10
0
US
Australia
38.1 Hong Kong 44.4
Kingdom
Sweden
Spain
United
Sweden 41.2 Japan 47.3
Source: UNECE Statistical Database.
Source: UNECE Statistical Database.
HABITS & OPENNESS

New categories of transactions are
getting digitized, for example
urban logistics services: cabs and
% of Population Made Digital Transactions taxis, food and grocery delivery,
household
98.3
95.6 95.9
90.1
84.0 95.6 95.9 98.3
90.
1
84.
UAE
UAE Singapore UK Australia Sweden
Source: W orld Bank Global Findex Databasse

TRUST IN
GOVERNMENT Predictable Enforcement
(Scaled from range 0 (lowest Score) to 1 (highest score))
The more people trust governments,

the more likely they are to transition
to digital payments.
Source: Govdata360.worldbank.org
Year
PERCEPTION OF CORRUPTION
Global non-cash transactions per capita VS. corruption perception index , 2016
• Some countries score high

in corruption perception
index, yet they have low
non-cash transaction per
capita
Number of non cash transactions
• More non-cash transaction

per capita (2016)
leads to higher score in

corruption perception index
• Higher score on the

corruption perception index
leads to more non-cash
transactions
Corruption Perception Index, 2016

(Decreasing level of Corruption)
Source: World Payment Report 2018
UNBANKED % of Population Unbanked
16.
16
3.6
3.6
2.1
2.1
The increased use of 0.5
0.5 0.3
0.3
digital payments could UAE

UAE Singapore UK Australia Sweden
likely require many of Source: World Bank Gobal Findex Database
the unbanked
individuals in each city
to open a bank
account. For some
individuals this may
lead to banking fees
that they otherwise
avoid.
0-20
21-40
41-60
61-80
81-100
No Data
Source: World Bank
Adults with an Account at a Formal Financial institution (%)

HABITS & TRADITIONS
Panama Germany Muslim World Kenya Muslim World

Caja de ahorrs Geld stinkt nicht Zakat Harambee Dowry
Participants deposit a set Meaning “cash doesn’t stink,” One of the five pillars of Swahili for “pull together,” this is a transfer of parental
amount of momen every it encourages the use of cash islamic faith, Zakat sees the sees communities pool thier property, gifts, or money at
month and then recieve the full instead of cards for day to day compulsory giving of at recources to invest in projects the marriage of a daughter
sum at Christmas. living expenses. least 2.5% of one’s income to for their mutual benefit. (bride)
charity.
USA
Greece Jamaica Muslim World India
Allowance
Harisma Susu Eidya Kuri Kalyanam
Giving a small amount of cash
to children weekly, to teach Wedding guests pin money to Each memeber contrivutes a is a gift that is usually given to To pay for big events such as
them about responsibility and the clothes of the bride and set amount on a monthly or children by elder relatives and wedding orhouse buuilding, a
how to make good financial groom to give them a fund for weekly basis. At each susu, family friends as part of the family will host a party where
choices. their future together. one member takes the money celebration of the two Muslim guests donate a cash sum.
to invest intheir needs, and it holidays: Eid al-Fitr and Eid al-
continues until everyone has Adha. The most common type
received a lump sum. of eidi is cash money
Source: Tem identur, que vollab ipicipi

The percentage of travel and
TOURISM tourism from the total economy for
Which countries are most dependent on the tourism industry? the selected countries is between
2.0%-5.0%
$12.2B
Sweden
$448B $106.7B
USA
$103.7B Japan
UK
$224B
$76.3B China
Italy
$17.7B
UAE $13.9B
Singapore
$14.5B
Egypt $34.6B
Australia

FINANCIAL INCLUSION Countries with populations comprised of

high percentages of these nationalities
have very high outgoing remittance
flow, and remittance is usually heavily
cash-based.
Countries with highest incoming

UAE Population by Nationality
remittance (US Billion Dollars)
Nationality Population
Country 2015 2016 2017
India 2.62 million
India 72.20 62.7 69
Pakistan 1.21 milllion
China 61.0 61.0 64
Bangladesh 0.71 million
Philippines 29.80 29.9 33
Philippines 0.53 million
Mexico 25.70 28.5 31
Iran 0.45 million
Nigeria 20.89 19.0 22
Egypt 0.40 million
Pakistan 20.10 19.8 20
Nepal 0.30 million
Egypt 20.40 16.6 20
Sri Lanka 0.30 million
Vietnam 12.30 13.4 14
China 0.20 million
Bangladesh 15.80 13.7 13
All Other Countries 1.71 million
Nepal 5.8 6.4 6.68
Total Expat Population 8.45 million

SOURCES
LETS GO
CASHLESS!
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• What do we mean by cashless?

Benefits Why? • Why should we go cashless?

• The role of stakeholders in enabling

• Key regulatory and legislative

Source: Smart Dubai

Source: Smart Dubai Analysis

CASHLESS QR Code Scans

PAYMENTS NFC Mobile

Direct Debit Authorization

Digital Transfers M&E Payments

Source: Smart Dubai Analysis

2011 2012 2016 / Present

Source: Smart Dubai Analysis

AROUND THE WORLD

Source: Nam , ipsapitatur sum dust, que el

• Undertaken regulatory initiatives to facilitate the payment service providers

2014 2015 2016 2017 2014 2015 2016 2017

Payment Diary Surveys

Source: B ank of International Settlements

CASHLESS Cashless Payments/GDP 2014 & 2017

9.7 9.7 9.6 9.9 10.2

Australia Singapore Sweden UK Japan US Spain UAE

Although absolute value and volume of Cashless Payments increased over

Source: B ank of International Settlements

EMERGING MARKETS MATURE MARKETS UAE MARKET

Source: Visa transaction data, Visa e-com m erce report

Source: Visa transaction data, Visa e-commerce report

Online payments continue to grow at a

players are now dominating the payments

Source: World Payments Report

$0.5 billion annually

• Increased government revenue generated

NET BENEFITS BUSINESSES

• Costs associated with processing

• Time savings in banking, transit and retail

DIRECT NET BENEFIT

$2.2 billion added to the city

$0.5 billion annually

$1.5 billion annually $0.2 billion annually

CATALYTIC BENEFITS As cities increase use of digital payments, the positive

0.05 0.11 0.11 0.08 0.12

Source: Smart Dubai Analysis

Legislative/ Regulatory Entities

STAKEHOLDERS Sector Associations/ Industry Bodies

Payment Service Issuers &

Government Private Sector

Source: Smart Dubai Analysis

SWEDEN AUSTRALIA UK SINGAPORE

Swedish Retail Australian Payments European Payments Singapore Payments

Central Bank of the UAE, Payment

Source: Smart Dubai Analysis

STAKEHOLDERS laws • Regulate financial institutions

SWEDEN AUSTRALIA UK SINGAPORE

Legislative* Legislative Legislative* Legislative

Source: Smart Dubai Analysis

Swedish Bankers’ The Australian Banking UK Finance The Association of Banks

UAE Banks Federation

Source: Smart Dubai Analysis

STAKEHOLDERS Payment Service Providers

SWEDEN AUSTRALIA UK SINGAPORE

Source: Smart Dubai Analysis

STAKEHOLDERS Issuers Acquirers