Saudi POS Spending Falls to SR14.2 Billion as Consumer Transactions Ease Across All Sectors

During the week that ended July 11, Saudi Arabia’s point-of-sale (POS) spending still surpassed SR14.2 billion ($3.8 billion), as consumer spending slowed generally with transaction values falling in all sectors tracked by Saudi Central Bank (SAMA).

The total value of POS transactions decreased 15.9 percent from last week, according to the most recent weekly information posted on SAMA. The volume of transactions also dropped by 6.8 percent to 250.5 million from 268.8 million in the previous week.

The latest figures also indicated declines in all categories, unlike recent weeks where some sectors saw positive growth, which indicated softer consumer spending.

Hotels was the most resilient segment, with transaction value declining by a mere 0.3 per cent to SR306.2 million. There was however no significant decline in the number of transactions in the sector, indicating that demand was fairly constant despite the overall slowdown.

Spending on construction and building materials also held up reasonably, declining 7 percent to SR411 million. Gas stations saw a 9.4 percent drop, while the value of transactions amounted to SR1.01 billion.

Education had the biggest weekly declines with spending down 42.1 percent to SR122.3 million. The transport of goods and postal and telecommunications courier activities also dropped considerably by 34.1 percent to SR46.4 million.

There were significant declines in other industries. Jewellery (-26.5 percent) and telecommunications (-26.3 percent) saw a decline in spending. Books and stationery fell 22.6 percent to SR105.8 million, while the cost of laundry services dropped 22.4 percent to SR57.5 million.

In turn, food and beverages continued to be the category with the largest spending even after a decrease of 19.8 percent, causing SR2.21 billion to be spent on the food and beverage category in the week. Restaurants and cafés were in the second place with SR1.85 billion, which experienced a comparatively smaller decline of 8.5 percent. Apparel, clothing and accessories was the third largest expenditure, decreasing 19.1 percent to SR1.2 billion.

Riyadh remained the top city for consumer spending in Saudi Arabia. In the capital, POS transaction values dropped 14.2 percent to SR4.72 billion and transaction volumes fell six percent to 78.7 million.

In Jeddah, spending decreased by 13.4 per cent to SR2 billion. Dammam was the biggest loser of the major cities in the Kingdom, as it saw transaction values decline by 14.6 percent to SR677.7 million. Spending in Makkah fell 12.1 percent to SR585.9 million, while Madinah saw a 14.4 percent drop to SR569.7 million.

SAMA’s weekly POS data is a significant indicator of Saudi consumer spending trends and confirms the growth of digital payment methods in Saudi Arabia. The development of e-payment facilities is in line with the Kingdom’s Vision 2030 to boost the digital economy and the use of cashless transactions in businesses and consumers.