DUBLIN--(BUSINESS WIRE)--The "Middle East and Africa Gift Card and Incentive Card Market Intelligence and Future Growth Dynamics (Databook) - Market Size and Forecast (2016-2025) - Q2 2021 Update" report has been added to ResearchAndMarkets.com's offering.

The socio-economic environment in Africa is expected to rebound which could have a positive impact on the gift card market. The Kenyan economy is expected to recover in 2021 with increase in real GDP by 6.9% YoY. While South Africa, Africa's second-largest economy recorded GDP expansion of 13.5% quarter-on-quarter in July-September 2020, recovering from the pandemic crash.

The strong growth in the e-commerce sector primarily supported the overall gift card industry during 2020, a trend expected to continue over the forecast period. Increasing smartphone penetration and consumer's inclination towards online shopping has positively impacted e-commerce sector. In South Africa, for instance, the growth in e-commerce market is one of the factors driving gift card market growth in the country. With growing online sales the spending on gift cards is also likely to increase in the country.

The gift card market in Kenya recorded substantial growth in the last few years. As one of East Africa's largest economies, technological advancements in the payment industry widened the scope of gift card market in Kenya. The market growth has been primarily backed by the rising adoption of gift cards by the millennials and Gen Z consumers, expansion of the retail sector, and growing inclination towards cryptocurrencies.

Nigeria's e-commerce sector is dominated by domestic e-commerce companies such as Jumia and Konga. Therefore, gift cards from these online retailers are also gaining popularity among the Nigerians. Additionally, international grocery retailers such as Spar have a strong presence in the Nigerian gift card market.

Consumers are widely accepting alternative payment options such as mobile wallets and electronic money transfer, instead of cash. The presence of the international brands in the Nigerian mobile payment system such as Visa with mVisa platform makes the mobile payment system more competitive. Moreover, it is expected that the global economic slowdown is unlikely to affect Africa's economy and the gift card market in the coming years.

The demand for gift cards is also increasing in line with the demand for cryptocurrencies. The trend of converting gift cards into bitcoins and then into cash is gaining popularity among the Nigerians and Kenyans. Cryptocurrencies and gift cards are driving the remittance market in Africa, and more specifically in Nigeria.

Key players such as Paxful allow Nigerians to trade gift cards offered by domestic players such as Konga or Blessing Computer for bitcoins. Other notable players offering this service in the country are Cardnosh and Cardtonic. Also, the demand for cryptocurrencies is increasing in Kenya which is alternatively driving the growth of gift cards. This is due to the ease of buying gift cards with cash and trading them for cryptocurrencies, without revealing the user's identity.

The gift card market in the Middle East region has witnessed strong growth over the last few years. Adoption of gift card has increased across retail and corporate segments with a range of use cases which go beyond "gifting". One of the factors driving growth of gift cards is e-commerce market. Merchants are incentivizing customers for shopping online and offering gift cards to increase sales and drive customer loyalty. The growth of e-commerce is expected to drive adoption of digital gift cards.

In the UAE, in particular, the e-commerce market grew in 2020 as more consumers shopped online due movement restrictions because of the fear of spread of COVID-19. Also, the need for greater online presence has supported e-commerce growth. Consequently, the adoption of digital gift cards has increased rapidly.

Due to the pandemic there has been a change in consumer behavior. There has been shift from physical gifts and gift cards to e-gift cards, driven by restricted movements due to Covid-19. Consequently, penetration of e-gift cards has increased significantly in 2020. Over the forecast period, the publisher expects e-gift cards to continue to gain market share.

Entertainment based gift cards are gaining popularity in the region especially in the UAE backed by increasing smartphone penetration as well as the rising popularity of over-the-top (OTT) media or internet streaming services. The OTT traffic has further accelerated in COVID times as individuals are confined to their houses and are spending more time on leisure activities.

In October 2020, Mastercard partnered with Amazon to offer Amazon Prime members in UAE 20% cash back in form of a gift card during prime day, when paid with Mastercard. Also, customers registering for Mastercard Platinum, World and World Elite Mastercard debit and credit cards issued by banks in the UAE, were provided an annual Amazon Prime membership.

The changing socio-economic condition primarily due to the coronavirus pandemic is changing the overall retail ecosystem. Sustainability has become the prime importance for manufacturers and retailers during the ongoing pandemic. Therefore, retailers are focusing on expanding their reach and building long term relationships with manufacturers and consumers. Importantly, the new trend in the retail ecosystem is creating substantial growth opportunities for hyperlocal retailing and co-branding gift cards.

Moreover, given the current situation, corporates have been focusing on motivating and incentivize their employees via digital gift cards. Also, multi-purpose cards help corporates to offer employees flexible gifting option.

The rising consumer interest in cryptocurrencies is also driving the gift card market growth. In Israel, for instance, consumers can buy bitcoins and other altcoins through gift cards or vice-versa. This has also created scope for third party players such as paxful.com and bitrefill.com to allow consumers to trade with bitcoins for gift cards.

This report details the impact of economic slowdown along with change in business and consumer sentiment due to disruption caused by Covid-19 outbreak on gift card industry.

Though growth of gift card industry has been impacted due to pandemic, there are certain segments which will gain market share. There are interesting trends emerging across various segments, which are expected to fundamentally reshape gift card industry dynamics. Despite near-term challenges, medium to long term growth story of gift cards remains strong.

This offering is a bundled offering, combining 8 country reports (Egypt, Israel, Kenya, Nigeria, Saudi Arabia, South Africa, Turkey, United Arab Emirates).

Closed Loop Gift Card Market Share by Key Retailers. Key Retailers Covered Include:

• Shufersal Ltd
• Super-Pharm (Israel) Ltd
• Rami Levi Shivuk Hashikma
• Yeynot Bitan Ltd
• Hamashbir 365 Holdings Ltd
• Dor Alon Israel Ltd
• Inter Ikea Systems BV
• Shoprite Holdings Ltd
• Pick 'n' Pay Stores Ltd
• Internationale Spar Centrale BV
• Wal-Mart Stores Inc
• Woolworths Holdings Ltd (South Africa)
• BIM Birlesik Magazacilik AS
• Migros Tic AS
• LC Waikiki Magazacilik Hizemetleri Tic AS
• Koc Holding AS
• Teknosa Ic ve Dis Ticaret AS
• Carrefour SA
• A101 Yeni Magazacilik AS
• Yildiz Holding AS
• Consumer Co-operative Union (CCU)
• Landmark Group
• Emke Group
• Damas International Ltd
• T Choithram & Sons
• Sharaf DG LLC
• Savola Group
• Saudi Co For Hardware (SACO)
• Jarir Marketing Co
• United Electronics Co
• Inditex, Industria de Diseno Textil SA

For more information about this report visit https://www.researchandmarkets.com/r/gx7gna

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