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Qatar Country Report

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  • Published Date: October 2017

A comprehensive overview of payment cards, retail banking and merchant acquiring in Qatar. Qatar's population grew by almost 59 percent between 2010 and 2016 to reach 2.6 million, with the majority living in urban centres such as Doha, Al Rayyan and Al Wakrah.
The top five banks – Qatar National Bank (QNB), Qatar Islamic Bank (QIB), Commercial Bank of Qatar (CBQ), Masraf Al Rayan and Doha Bank – held around 69 per cent of total banking assets and 56 percent of the total branch network at the end of 2016.
In Qatar, credit card spending at the POS is growing both in absolute terms and as a proportion of total credit card billed volume. There are three key acquirers operating in Qatar. QNB and CBQ dominate the market with a combined market share of 86 percent in terms of payment card acquired billed volume (includes both credit and debit cards).
There were about one million Visa-branded debit cards in circulation at the end of 2016, representing a market share of about 61 percent.
E-commerce in Qatar is in its infancy and continues to suffer from low levels of consumer confidence in electronic purchasing and from a lack of regulation of the online payments infrastructure. B2C e-commerce is estimated to make up around 52 percent of the total e-commerce market in Qatar.

QATAR CARDS AND PAYMENTS REPORT | KEY FACTS

  • Qatar has the third-largest natural gas reserves in the world. The oil and gas sector contributes around 50 per cent to the country's GDP and accounts for about 85 per cent of export revenues.
  • Qatar National Bank is the largest bank in terms of assets, holding nearly one-third of total banking assets in Qatar, followed by Qatar Islamic Bank, with a market share of 11 per cent.
  • Consumer lending in Qatar has grown at a robust pace since 2010. Total outstandings per household surpassed $70,000 at the end of 2016.
  • At the end of 2016, there were over 2.5 million payment cards in circulation in the country, of which two-thirds were debit cards.
  • In 2016, the debit card POS billed volume was 2.4 times that of credit cards. Debit cards spending exceeded that on credit cards for the first time in 2009.
  • Due to a greater focus on credit quality during the post-financial crisis period, credit card issuers have been targeting affluent and high net worth customers.
  • Net interest revenue on credit cards is low due to a declining rollover rate and low APRs; 95 per cent of credit card revenue is fee-based.
  • All credit and debit cards carry international branding. Visa is the leading network in both credit and debit cards segments.
  • Banks in Qatar have been actively promoting the use of credit cards through rewards schemes and promotional campaigns.
  • Major hypermarkets and large five-star hotels owned by the government holding company, Q-Hotel, account for a major share of the total acquiring business.

Qatar Payments Research | Report Contents

TABLE OF CONTENTS

Demographics and Economy
Outlines the key metrics and trends which influence the development of retail banking and payments in the country:

  • Population structure
  • Income
  • Mobile and internet use
  • Economic data

Retail Banking
Explores the structure of the local banking system, its infrastructure and the leading players. Data includes:

  • Aggregate retail banking indicators
  • Bank branch, ATMs and POS terminals
  • The profitability of top banks

Consumer Finance
Overview of consumer finance in the country. Categories analysed include:

  • Mortgage loans
  • Personal loans
  • Credit card loans
  • Vehicle loans

Credit Cards
Industry-leading credit card coverage. We detail the past present and future of the industry through our data and commentary, including:

  • Market size split by consumer and commercial credit cards: number of cards, transaction volume, billed volume
  • Profit pool analysis
  • Competitive landscape: networks, issuers

Debit Cards

  • Market size: number of cards, transaction volume, billed volume
  • Competitive landscape: networks, issuers

Prepaid Cards

  • Market size: number of cards, transaction volume, billed volume

Qatar Country Report | Selected Extracts

Demographics and Economy
Qatar's population grew by almost 59 percent between 2010 and 2016 to reach 2.6 million, with the majority living in urban centres such as Doha, Al Rayyan and Al Wakrah.

Payments Environment
The internet-enabled population in Qatar was around 2.4 million at the end of 2016, and is expected to reach 2.7 million by 2019. The rise in smartphone and internet penetration is expected to create huge opportunities in the e-commerce sector in the country.

Consumer Finance
Consumer lending in Qatar has grown at a robust pace – at a CAGR of 115 percent between 2010 and 2016. Total consumer credit outstandings reached $39 billion at the end of 2016, an increase of 13 percent for the year.

Cards market
Qatar is still a cash-based society with cash often used for payments at small businesses, including food courts, and supermarkets. However, the payment cards market is also developing significantly, with the number of payment cards in circulation growing by about 179 percent.

Mobile Payments
Mobile-phone and smartphone penetration is rapidly increasing in Qatar with an estimated 147 mobile phones and 95 smartphones per 100 inhabitants in 2016, which indicates that there are ample opportunities for mobile-money services in the country.

Profit Pool
The Qatari credit card industry's pre-tax profit was around $63 million in 2016, an increase of 31 percent when compared with 2015. It is estimated to reach $89 million in 2017.

Card Networks:
Visa is the dominant network in the market both in terms of the number of credit cards in issue, with a 66 percent share, and billed volume, with a 60 percent share at the end of 2016, followed by Mastercard. Debit cards are the most popular form of payment cards in Qatar, representing 67 percent of total payment cards in circulation and 90 percent of total card spend in 2016.

Key Retail Banks and Issuers
The payment cards market in Qatar is concentrated among three key players: CBQ, QNB and Doha Bank. At the end of 2016, these three banks collectively held a market share of 34 percent and 73 percent in terms of credit cards in issue and credit card outstandings respectively.

Acquiring and Processing
There are three key acquirers operating in Qatar. QNB and CBQ dominate the market with a combined market share of 86 percent in terms of payment card acquired billed volume (includes both credit and debit cards). None of the major credit card issuers and acquirers in Qatar outsource their credit card issuing or credit card acquiring processing. However, smaller players have outsourced their card issuing processing.

Online Acquiring
The top three banks providing online merchant acquiring services in Qatar are QNB, CBQ and Doha Bank. QNB is the largest online acquirer and is estimated to have had a market share of 45 percent in terms of total online acquired billed volume in 2016.

Regulatory and Markets Information
The Qatari Government has taken this initiative to move the country towards a cashless society and also to monitor companies' salary payments to employees. The Wage Protection System (WPS) is governed by the QCB and the Ministry of Labour and Social Affairs.

MORE MIDDLE EAST PAYMENTS REPORTS

Verisk reports deliver invaluable market and competitor intelligence on payments cards, e-money, acquiring/processing, retail banking, and consumer credit throughout the Middle East. Analysts and researchers use both primary and secondary source data and conduct in-depth interviews with senior industry executives and Middle East experts.

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