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Points-of-sale spending comprised 52.5% of Q1 2024’s total credit card expenditure, with a 7.8% increase to 552.1 million dinars from the previous year’s 511.9 million dinars.
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Direct purchases with credit cards in Kuwait rise 12.98%, totaling 45.8 million dinars, reaching 398.5 million dinars by the end of the first quarter of 2024.
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Cash withdrawals made up 13.7% of total credit card spending in Q1 this year, rising by 12.26% to reach 144.6 million dinars. Card-based fund withdrawals within Kuwait rise 13.19% to 134.7 million dinars in Q1 2024.
Data released by the Central Bank of Kuwait indicates that spending through credit cards by citizens and residents increased by 11.24% during the first quarter of 2024, reaching 1.051 billion dinars. This represents a rise from 945.2 million dinars spent in the same period in 2023, as reported in Al Anba newspaper.
Spending via credit cards is distributed as follows: 552.1 million dinars in point-of-sale device transactions (direct purchases), 144.6 million dinars in transactions at automated debit machines (cash withdrawals), and 354.8 million dinars in transactions made via websites (purchasing and paying for online services).
The 11.24% increase in credit card spending reflects economic growth and heightened individual consumption, indicating an overall improvement in the economy and consumer confidence.
Specifically, data reveals that spending at points of sale accounted for 52.5% of total credit card spending in Q1 2024. Comparing annually, total spending in Q1 2024 saw a 7.8% increase of 40 million dinars, reaching 552.1 million dinars, compared to 511.9 million dinars in the same period in 2023.
The figures show that direct purchases with credit cards in Kuwait increased by 12.98%, totaling 45.8 million dinars, reaching 398.5 million dinars by the end of the first quarter of this year, compared to 352.7 million dinars for the same period in 2023. The 12.98% increase in direct purchases within Kuwait suggests it may be due to various factors like rising salaries, local market promotions, or inflation effects.
Direct purchases with credit cards outside Kuwait decreased by 3.5%, totaling 5.6 million dinars, reaching 153.6 million dinars by the end of the first quarter of 2024, compared to 159.2 million dinars at the end of the first quarter of 2023.
Cash withdrawals
Cash withdrawals accounted for the value of transactions made by citizens and residents with credit cards at ATMs, comprising 13.7% of total spending through these cards in the first quarter of the current year. It rose by 12.26% annually, amounting to 15.8 million dinars, reaching 144.6 million dinars compared to 128.8 million dinars in the first three months of 2023.
Card-based fund withdrawals increased within Kuwait by 13.19%, totaling 15.7 million dinars, reaching 134.7 million dinars during the first quarter of 2024, compared to 119 million dinars in the same period in 2023.
Cash withdrawals abroad using the same cards saw a slight increase of 1.02%, totaling 100 thousand dinars, reaching 9.9 million dinars by the end of the first quarter of 2024, compared to 9.8 million dinars for the same period in 2023.
Website transactions comprised 33.7% of credit card spending
The value of transactions made through websites accounted for 33.7% of credit card spending, experiencing an annual increase of 16.5%. This amounted to 50.3 million dinars, reaching 354.8 million dinars, compared to 304.5 million dinars at the end of the first quarter of 2023.
Online spending with credit cards within Kuwait in Q1 2024 increased by 22.5%, totaling 28.8 million dinars, reaching 156.8 million dinars compared to 128 million dinars for the same period in 2023.
Spending via websites abroad rise 12.18%, totaling 21.5 million dinars, reaching 198 million dinars during the first quarter of 2024, compared to 176.5 million dinars for the same period in 2023.
Online spending sees 16.5% increase
The data shows that the 16.5% rise in online spending indicates an increasing trend towards e-commerce and digital services. This could be the result of changes in purchasing habits and consumers’ preference for online shopping, especially after the COVID-19 pandemic. Additionally, the significant increase of 32.7% in spending via foreign bank cards indicates an increase in the number of visitors or tourists in Kuwait, which strengthens the local economy.
170.1 million dinars spent via foreign bank cards
The Central Bank of Kuwait data shows that spending via foreign bank cards reached 170.1 million dinars in the first three months of this year, marking a 32.7% increase of 42 million dinars compared to 128.1 million dinars in Q1 2023.
Spending through POS hit 139 million dinars
From January to March 2024, spending through points of sale (POS) hit around 139 million dinars, all within Kuwait, witnessing a 39.2% annual growth of 39.2 million dinars compared to 100 million dinars in 2023.
Cash withdrawals from foreign bank cards inside Kuwait saw a 9.96% increase, reaching 30.9 million dinars in Q1 2024 compared to 28.1 million dinars in the same period in 2023.
Growth in credit card spending to continue
Based on the data from the Central Bank of Kuwait for the first quarter of 2024, it is expected that growth in credit card spending will continue, with an increased reliance on e-commerce.
Financial institutions may need to strengthen their digital infrastructure to support this trend, and local banks can develop strategies to motivate customers to use their credit cards more by offering rewards, loyalty programs, and special offers.
Individuals should also be encouraged to monitor their expenses and use credit cards wisely to avoid unnecessary debt.
