Kuwaitis, expats spend $1.7bln in 17 days

KUWAIT CITY: The CEO of Joint Automated Banking Services Company (KNET) Abdullah Al-Ajmi revealed that the volume of spending by citizens and residents from May 1-17 reached 537.180 million dinar.

Al-Ajmi disclosed that the total withdrawals exceeded 1.123 billion dinars in April, compared to 1.672 billion in April 2019, while the expenses in March reached about 1.385 billion, all of which indicate successive declines in the volume of spending in general.

He pointed out that the total daily withdrawals of citizens and residents declined during the ban period to about 16 million dinars, compared to the size of last Saturday’s withdrawals reaching 15.6 million dinars, compared to the average withdrawals of approximately 50 million dinars that were disbursed before the Corona crisis.

In details, Al-Ajmi indicated that KNET prepared a study to measure the rates of local spending during the partial ban period, specifically since the first of April. It was discovered that the exchange aspects during this period and within the total ban period focus on purchases in the cooperative societies and markets, which accounted for about 80 percent of the total exchange in this period.

Withdrawals

He explained that the rate of daily withdrawals executed through POS devices reached 10 million dinars during the period between April 1 and before the total ban scheduled for May 9, indicating the rate fell by 65 percent since the beginning of the total ban.

He pointed out that the highest daily withdrawal rate implemented through point of sale devices since the beginning of April and until 9 May this year amounted to 16 million dinars, which reached the lowest daily rate of 6 million dinars. This reflects a wide gap in the curve of withdrawals whose strength is determined according to various considerations. He explained that the average withdrawals implemented through POS devices have declined significantly since the approval of total ban on the 10th of this month, registering a decline of about 3.5 million dinars out of 10 million dinars withdrawn during the partial ban period, noting the largest withdrawals made through the points of sale in the past 8 days amounted to 4 million dinars.

It is worth mentioning the points of sale operations during the month of March amounted to 547 million dinars compared to 784 million dinars withdrawn through devices last February, and 832 million dinars were withdrawn in March 2019, which means the value of operations declined by about 160 million dinars last April compared to March.

The highest number

With regard to automated “cash” withdrawals, Al-Ajmi said the highest number of cash withdrawals in the previous 50 days was recorded prior to announcing the date of the total ban, noting that cash withdrawals on Friday, May 8, amounted to 28 million dinars and the average of cash withdrawals up to the day of implementing the total ban reached 13 million dinars. The highest rate of withdrawals “other than the day of the attack on cash” reached an average of 20 million dinars, and the lowest rate of withdrawals amounted to 8 million dinars.

Of course, electronic payment has been most prevalent after the total ban, as Al-Ajmi indicated the average daily rate of electronic withdrawals reached 10 million dinars in the first phase of the ban, then rose to 15 million dinars after instituting home delivery service. Last March, the value of online withdrawals amounted to 354 million dinars, compared to 307 million dinars in February and 205 million dinars in March 2019. As for the number of operations, Internet withdrawals increased from 5.3 million transactions in February to 6 million in March, compared to 4.4 million in March 2019.

Cash decline

Al-Ajmi noted that after the total ban, cash withdrawals decreased at extremely large rates, with an estimated average of about 2.5 million dinars per day, while withdrawals from the ATM in cooperative societies that are within the residential areas were concentrated.

A day in the ban

Regarding the nature of withdrawals that took place during the past few days, Al-Ajmi clarified that KNET officials prepared a study entitled (Day of Ban Withdrawals) to show the sources of daily withdrawals and aspects of exchange, and concluded that withdrawals of this day included 2.6 million dinars cash, and 4 million point-of-cash withdrawals compared to 9 million implemented via electronic payment channels. Al-Ajmi said the “Day in Ban” statistics showed that 77.8 percent of the total withdrawals of last Saturday were spent in cooperative societies and markets, while pharmacies covered 5.5 percent, followed by other withdrawals with an estimated share of 6.4 percent. In the fourth place was public purchases covering 4.4 percent, while the small supermarket withdrawals were appended by 4 percent.

1,400 new sale points in cooperatives and pharmacies

Al-Ajmi reported that KNET provided its customers in the month of April with 1,400 additional point of sale devices, explaining those devices were distributed to cooperative societies, central markets and others due to an increase in demand for them in the recent period.

He stated that many cooperative societies, including catering, family supplies and the library, recently stopped trading with cash and only receive payments through points of sale, as part of the preventive measures.

Al-Ajmi reiterated that this trend, in addition to the delivery of orders from cooperative societies and pharmacies, further strengthened the need to order more POS devices, especially as they’re relied upon and transferred to the customer to pay from his home