Dubai/Cairo/Riyadh, July 27, 2022: Tribal Credit has highlighted local enterprises’ most significant spending categories based on corporate card spending data from small, medium, and emerging businesses tracked over the last year.
As businesses develop throughout the region, their expenditures are becoming more important to economic growth.
Despite the relaxation of COVID-19 restrictions, 9 out of 10 purchases were made online in recent months, reflecting the shift toward that e-commerce and online shopping.
As shown by Tribal data, online advertising was the category where companies in various stages of development spent the most during this period, further demonstrating the long-term growth of online sales.
For companies and advertising service providers, payments for digital campaigns with cards streamline the payment process, control of expenses and the relationship with platforms.
The second largest expenditure on corporate cards was for freight services and logistics, primarily for imports and exports. Growing e-commerce provides companies in various stages of development with an excellent opportunity to expand to additional markets, which has become increasingly important with the growth of e-commerce.
Lastly, companies spent the third highest amount on technology and computing infrastructure, such as hardware, software, and programming services. Digital infrastructure spending shows that companies continue to adapt their operations to the digital economy.
In MENA, tribal observed that travel spending, including travel agencies, flights, and hotels, showed the most substantial growth between the second half of 2021 and the first half of 2022. The region’s companies in various stages of growth have ranked travel spending among the top ten expenses during the last quarter. A high increase in spending in this sector indicates that companies are expanding their markets and travelling to improve their operations.
The use of services such as Tribal can make managing digital spending more effective by making it simpler to track and manage.
Amira Fadel, Tribal’s Regional Manager, MENA, said: “It is important to take into account that companies continue to adapt to the new times with the revolution in disruptive technologies, and many are accelerating their digitisation processes. In this sense, it is valuable to see that companies are using their capital and corporate credit resources to make payments, especially through electronic commerce, directly related to boosting business growth”.
SMEs in Egypt account for 90% of active enterprises and 80% of GDP, according to the Organisation for Economic Cooperation and Development. In the UAE, SMEs represent 86% of the private sector labour force and 60% of GDP. Furthermore, Saudi Arabian government data indicate that SME contribution to GDP has risen to 28.7% since March 2021.
Fadel added: “We know that MSMEs are the backbone of the global economy and that most of the world’s employment comes from them. Therefore, continuing to bet on the expansion of its businesses is key to continue contributing to economic and social development”.