KUWAIT CITY, Feb 18: Kuwait has experienced a significant surge in electronic purchases and payments by both citizens and residents, marking remarkable progress in financial inclusion and the strength of the country's digital infrastructure. Technological advancements, such as the widespread use of smartphone payment systems, digital wallets, and credit cards linked to e-commerce platforms, have simplified financial transactions, allowing them to be completed with a single touch. This convenience has boosted consumer confidence in online shopping.

This transformation has led to a dramatic shift in consumer behavior, where convenience, speed, and security are now key factors in purchasing decisions. The shift has not only enhanced the consumer experience but also empowered entrepreneurs and start-up owners, providing them with an opportunity to easily launch online stores and reach a wider audience without requiring large investments. Consequently, the digital retail sector and online services have experienced unprecedented growth, contributing to the strengthening of the digital economy and fostering sustainable innovation.

According to data from the Central Bank of Kuwait, the volume of purchases and payments made via websites, both domestically and internationally, has been increasing year after year. These transactions now account for about 40% of total spending via bank cards. In 2024, online spending grew by 7.1%, with total e-purchases reaching a historic high of KWD 18.8 billion, compared to KWD 17.5 billion in 2023, marking an increase of KWD 1.24 billion.

The data further reveals that Kuwait is among the fastest-growing countries in the Gulf region in terms of e-commerce, with a substantial increase in the number of local and international e-stores serving the Kuwaiti market. In 2024, total purchases via websites amounted to KWD 18.78 billion, with KWD 17.3 billion spent on local e-purchases and KWD 1.48 billion spent on international e-purchases.

Looking at quarterly spending in 2024, total e-transactions in the first quarter reached approximately KWD 4.7 billion, distributed as follows: KWD 4.4 billion locally and KWD 326.6 million internationally. In the second quarter, the total rose to KWD 4.8 billion, with KWD 4.49 billion spent locally and KWD 359.1 million internationally. The third quarter saw e-purchases reach KWD 4.7 billion, with KWD 4.33 billion spent locally and KWD 407.8 million spent internationally. Finally, in the fourth quarter, e-transactions totaled KWD 4.4 billion, with KWD 4 billion in local purchases and KWD 387.9 million in international purchases.

These figures highlight the major digital transformation in Kuwait, leading to an increase in the share of local online purchases. Most companies now offer e-shopping options and express delivery services, making online shopping a more convenient choice compared to visiting traditional stores. The growth of e-purchases has also been supported by improvements in e-payment systems, government efforts to regulate e-commerce, the development of logistics infrastructure, and the widespread availability of express delivery services.

E-purchases from abroad have also experienced significant growth, particularly through trusted global websites that offer a wide variety of products at competitive prices.

Looking ahead, the e-commerce sector in Kuwait is expected to continue its growth, driven by digital transformations and rapid technological advancements. E-commerce is becoming an integral part of the modern economy, and with continued government support for the digital environment, Kuwait is expected to emerge as a prominent regional hub for e-commerce, offering vast opportunities for investment and innovation.

On another front, the Ministry of Commerce and Industry is working on drafting a “Digital Commerce Law,” which aims to create a comprehensive regulatory framework for this vital sector. This law will balance the facilitation of commercial activities with the protection of consumer rights, while also enhancing the digital economic environment in Kuwait.

The law aims to ensure transparency, protect consumer rights, and regulate the relationship between merchants and consumers, as well as the relevant government agencies. It will also address technological developments and future challenges.

The Ministry of Commerce recently completed the final draft of the “Digital Trade Enabling Law” after a broad consultative process that involved input from the business community. The Minister of Commerce and Industry, Khalifa Al-Ajeel, called for this consultation on December 4, with the goal of creating a favorable legislative environment for the digital trade sector. The second draft of the law will be submitted to the Fatwa and Legislation Department in the coming days before being presented to the Council of Ministers.

The “Digital Trade Enabling Law” is one of the Ministry’s key priorities, aimed at stimulating the Kuwaiti business environment, regulating various business sectors, and empowering business owners.