Adding inclusion to innovation

Author: Alain Bejjani — CEO, Majid Al Futtaim — Holding

How do you disrupt a disruption? How do you turn something innovative into something even more so? The answer starts with thinking alloy.

All science students know stronger alloys are created by mixing metals — and knowing which specific ingredient to add can improve toughness, corrosion resistance, ductility and so on.

The same is true for business: Knowing your business and your market thoroughly allows you to add the right ingredient that will strengthen an innovation and increase its traction. At Majid Al Futtaim, we live this ethos — and displayed it most recently in our new fintech venture.

Like ecommerce before it, digitised payments grew exponentially last year with the need for new and accessible payment alternatives. ‘Buy Now, Pay Later’ or BNPL is one of the fastest-growing innovations in the fintech space, for example. It does just what it says on the tin — offers consumers an alternative way to shop online and pay in interest-free instalments, without credit card debt or extra fees and with near instant approval.

For more mature consumers, BNPL affords payment flexibility, particularly at a time when incomes and expenses have been unstable, and contactless safety; it is a powerful and prudent option for the unbanked; and for businesses, it’s a way to stay ahead and meet the needs of their clientele. It is, in short, your standard win-win.

Although BNPL currently accounts for a small fraction of overall payment card spend, it’s estimated to capture nine per cent of the total MENA e-commerce market by 2023, and up to $680 billion in worldwide transaction volume by 2025.

Improving on the current BNPL model required both deep market and consumer knowledge, the willingness and capability to push the boundaries, and an existing like-minded ecosystem. Our team leveraged all three to create another first of its kind in the region: a Gift Now, Pay Later card.

Our offering flips the traditional model. In addition to creating an online marketplace that offers BNPL, our card is BPNL-enabled, allowing consumers to access BNPL across our nine UAE malls to start with. Instead of having the standard access to a single merchant, it offers access to more than 2,200 stores.

Our MAFers also tapped into the felt need of many of our consumers to continue caring for their families and friends even in these challenging times. They, together with tabby, worked hard to launch our Gift Now, Pay Later card during Ramadan, to allow as many people as possible to enjoy the spirit of the season by providing for family members and friends.

What the team has done is create value and experiential differentiation for our customers, while delivering commercial benefits and direct value to our retail partners. This is a different tier of win-win. This is innovation — not only staying abreast of emerging trends but elevating them until they are fit for our purpose.

Crucially, this new embedded finance offering fits perfectly into our existing digital ecosystem. Without a receptive and enabled ecosystem, innovation founders.

I’m proud of our team’s achievements in this space, and their drive for continuous improvement.

To me, this is a reminder. Even as we yearn for business as usual, let’s also make room for business unusual — the innovations we initiated, rolled out and improved on in the last year. Let us not just go back to business, but take what makes us stronger forward.

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