Bank Regulation

MENA Region Holds Regulatory Clues For Merchants

global payments

Confident risk analysis can seem hard to come by when the world goes off its commercial axis, as it has been this year. In regions where open banking and other electronic payments pilots are becoming common, such as the Middle East-North Africa (MENA) region, pandemic-era payments are all about privacy, security and trust, particularly in B2B transactions.

Necessary ingredients of healthy international B2B commerce are dealt with in detail in PYMNTS’ new Merchants Guide To Navigating Global Payments Regulations done in collaboration with Ekata, which surveys the expanding global B2B payments landscape.

“Consumers in the MENA region have been flocking to online channels since the pandemic’s onset and businesses have followed suit by deploying new digital payment capabilities and offerings,” the Guide states. “This digital shift is leading consumers to examine just how private their online activities are, with one recent survey finding that 84 percent of UAE consumers have tried to remove private information from websites or social media. Questions regarding data privacy regulations are expanding in scope and scale as regulators take careful note of consumers’ concerns.”

Consumers’ emerging payment preferences will affect the future of open banking and privacy regulations in the region, and elsewhere around the world.

Privacy Protection In The Spotlight

The regulatory climate is growing increasingly difficult for merchants as variations in banking law and data privacy laws are seen as impediments to unrestrained recovery commerce.

For example, the new Merchants Guide To Navigating Global Payments Regulations notes, “Other regulators are working to keep pace with a pandemic-driven focus on online privacy standards. Officials in Dubai recently revamped their regulations to ease merchants’ payment frustrations and to keep consumers’ transactions seamless and secure. The nation’s rule sets new standards for online entities’ treatment and storage of digital data that largely mirror those in the EU and U.K. under the GDPR. Dubai’s merchants will now be expected to more strictly safeguard much of their customers’ information, and this is likely to occur within many other Middle Eastern countries in the near future.”

With merchants now on the hook for protecting consumer data more than ever before, that requires partners who know the security space, and solutions engineered for unique COVID-era challenges to an assortment of important economies in emerging regions.

“Making sure merchants are well-advised and ready to confront upcoming open banking changes is critical as the pandemic pushes these developments to the next level in numerous global markets. Merchants, their payment providers and their regulators must keep up,” per the new Guide.

Lessons From Abroad

Developments in MENA and other regions are both reflected in and informed by similar maneuvers happening stateside in contactless payments and attendant security issues.

“American shoppers are more frequently tapping contactless and mobile payments during the pandemic, with one payment service provider’s recent card data showing that mobile wallet-enabled debit transactions rose by 76.6 percent year over year during the week of Aug. 9,” according to new Merchants Guide To Navigating Global Payments Regulations.

“This growth is prompting merchants and their payment providers to reexamine the security measures attached to card-not-present (CNP) payments. 3D Secure 2.0 software, which encrypts payment details to provide enhanced fraud protection for consumers and merchants, has sparked increased interest. Retailers must ensure that such security technologies do not add too much friction into the online payment experience as consumers tend to abandon purchases that frustrate them. This concern is becoming especially familiar to merchants in the EU and the U.K. working to craft identity verification tools that can satisfy customers while complying with upcoming strong customer authentication (SCA) mandates,” per the Guide.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.