KARACHI: From ride-hailing services to grocery delivery, and financial services to microfinancing, super-apps development in Pakistan, Middle East, and Africa is emerging fast as the region proves to be a potentially fertile ground for its growth, a study finds.
Commissioned by Mastercard and carried out by Economist Impact, the study titled ‘From online bazaar to one stop shop: The rise of super-apps in the Middle East and Africa’ examines how population growth, digital access, connectivity, diverse demographic, increasing trust, and affordability is contributing to the rapid progress of super-apps in the region.
“The region is home to a young, digitally savvy population with an appetite for new technologies and innovation. This dynamism is evidenced across the region, including through the emergence of super apps,” said the report.
“..With the Middle East and Africa region projected to become the most populous area in the world, with a forecast population of 3.4 billion by 2050, this expanded market presents a wealth of customer data, which regional players could leverage to add value for all stakeholders.”
While multi-function apps have been popular in Asia for some time, cut-through elsewhere in the world has been slower. Consumers in western and MEA including Pakistan markets have largely messaged, hailed taxis, summoned food, and paid for things with different apps. But more recently firms including Spotify, Uber, and Revolut have raced to bundle ever more features into their apps.
Firms such as Dubai-based Careem have emerged as local champions, expanding from ride hailing to grocery delivery and payments. Other businesses have sought partnerships to expand their capabilities, such as Vodacom in South Africa, which joined forces with Alibaba’s AliPay.
The report highlights that super-apps can be drivers for financial inclusion in the MEA. In remote areas of the region a lack of traditional bank branches has contributed to scant financial service provision. By bundling together a wider array of financial services in an all-in-one platform that requires little data or storage to operate, and can leverage users’ data to assess credit-worthiness or support payments, super-apps are enabling previously unbanked citizens access to a wider financial ecosystem, it continued.
The study also states that a lack of vast data pools in the MEA weakens one of the market advantages that the super-app model offers. Analysing data collected from customers gives digital services invaluable information on consumer preferences. Super-apps multiply this by collecting data across a series of connected services.
As per the findings, although the African Union and Gulf Cooperation Council are fostering the harmonisation of industrial and data policies, for super-apps seeking to further their reach, the current fragmentation presents a significant operational, legal, and financial burden. The harmonisation of national policies remains the biggest challenge to the scaling up of super-app presence in the MEA region that consists of more than 60 countries with over 1,000 languages and divergent economic, policy, and cultural environments.