Why Gulf eSIM adoption needs more than advanced networks
Deepak Gusain, COO of fintech marketplace Cartex, explains why eSIM adoption depends less on network readiness and more on regulation, digital distribution and embedding connectivity into existing financial and travel journeys
21 July, 2026
TT
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eSIM technology may be mature, widely supported and available across most modern smartphones, but its path to mainstream adoption remains uneven.
For Deepak Gusain, COO of new-generation fintech marketplace Cartex, the issue is not a failure of the technology itself. Instead, adoption is being held back by fragmented customer journeys, limited awareness and regulatory processes that can undermine the central benefit of eSIM: instant digital connectivity.
“I would not say eSIM has failed. Rather, its adoption has been highly uneven. The technology is mature, device compatibility is expanding and operator support is widespread. The real constraint is the surrounding ecosystem: how easily consumers can discover, purchase, activate and manage an eSIM, and whether regulation supports a fully digital journey.”
Gusain has more than 20 years of experience across telecoms and fintech, including senior leadership positions at Tata Communications. He believes the next phase of eSIM growth will be shaped by collaboration between telecom operators, fintechs, travel platforms and digital wallets rather than by network operators acting alone.
Infrastructure does not guarantee adoption
Global eSIM adoption illustrates the gap between technical capability and consumer uptake.
“The Global eSIM Index illustrates this clearly. China and India, two of the world’s largest telecom markets, rank 36th and 49th respectively, while the much smaller South Korea ranks ahead, partly due to regulatory support for digital activation. Market size alone guarantees nothing.”
Consumer awareness remains another challenge. Operators may offer eSIM services, but users often do not know that the option exists or understand how it differs from a physical SIM, Gusain reveals.
For Gusain, this reflects a wider problem facing digital infrastructure providers: the availability of a technology does not automatically translate into demand. “That gap between technical availability and consumer understanding is not unique to eSIM. It is a recurring challenge in digital infrastructure: launching a capability does not automatically create adoption.”
Fintech companies are gaining ground in travel eSIM distribution because they can offer connectivity as part of an existing customer journey.
A telecom operator typically markets connectivity as a standalone service, requiring customers to actively search for, compare and purchase a plan. Fintech platforms, by contrast, can introduce an eSIM while a customer is already preparing for international travel.
“Fintechs are not necessarily offering a different eSIM, but they are offering it in a different context.”
A customer exchanging currency, activating a travel card, arranging insurance or booking accommodation can be offered connectivity without leaving the platform they already use.
“The customer does not actively decide, ‘I need an eSIM,’ but simply continues a familiar journey in which connectivity is already embedded. This reduces friction significantly.”
According to Gusain, users activating an eSIM through their primary financial application have stronger retention than those purchasing connectivity through a separate app.
“Users who activate eSIM directly in their main financial application show a 22 per cent higher retention over the year compared to those who purchase a connection through a separate application. The product itself is the same, but the friction between the desire and the result is much lower in apps where everything is gathered together.”
This ability to place connectivity at the point of need could allow fintechs, travel companies and digital wallets to become the most influential distribution channels for eSIM services.
The UAE adoption gap
The UAE combines advanced mobile infrastructure, high smartphone penetration and globally competitive telecom operators. Yet the country ranked 41st in the Holafly Global eSIM Index 2026.
Gusain argues that the ranking should not be viewed as a reflection of the UAE’s telecom capabilities.
“The UAE’s ranking should not be interpreted as a weakness in its telecom infrastructure. The country has highly advanced mobile networks, strong smartphone penetration and sophisticated operators. In fact, the same index ranks e& third among the 171 operators evaluated globally, while du ranks 24th. It also estimates that approximately 65 per cent of devices in the UAE market are eSIM-capable.”
The more significant issue, he says, is the impact of regulation and activation requirements on the customer journey.
He adds: “The answer is that the very methodology of the index contains a kind of penalty for regulatory heaviness. This means that even if the infrastructure itself is perfect, if the activation process is bureaucratically complicated, it still drags the final ranking down.”
Restrictions affecting some international travel eSIM providers can also reduce consumer choice after travellers enter the country.
“In the UAE, access to or initial activation through certain international travel eSIM providers may be restricted once the traveller is already inside the country. This can reduce consumer choice and create additional friction, even though domestic operators have strong eSIM capabilities.”
The market therefore highlights the difference between advanced network infrastructure and an open digital marketplace for travel connectivity.
“The UAE therefore demonstrates an important point: world-class connectivity infrastructure and an open travel-connectivity marketplace are not necessarily the same thing,” Gusain says.
Saudi Arabia offers a regional contrast
Saudi Arabia’s ranking offers a contrasting example of how regulatory support can accelerate adoption even in markets with broadly comparable infrastructure.
Gusain says: “For contrast, it is worth looking at Saudi Arabia — it ranks 10th in the world with a score of almost 80, thanks to Vision 2030 and targeted regulatory support. Turns out that in a region with a similar infrastructure, a more user-friendly regulatory policy can make a difference of more than thirty positions.”
Across the Gulf, the commercial opportunity is significant. The region combines high smartphone penetration, substantial inbound and outbound travel and a population accustomed to digital onboarding, mobile wallets and super apps.
However, Gusain says technical readiness must be matched by regulation that preserves the convenience of digital provisioning.
“If purchasing and activation require multiple identity checks, physical presence, restricted distribution channels or an operator-specific process, the central advantage of eSIM which is instant digital provisioning is weakened.”
This explains why countries with similar network quality can record very different adoption levels.
“The Gulf has the underlying conditions to become one of the world’s most important eSIM regions. But the speed of adoption will depend on whether regulation, operator models and digital distribution are aligned around a low-friction customer experience.”
Embedded connectivity emerges as the winning model
The long-term eSIM market is unlikely to be controlled exclusively by a single sector.
Operators retain assets that fintechs and travel platforms cannot easily replicate, including spectrum, national network infrastructure, wholesale capacity and control over mobile service provisioning.
He says: “Telecom operators own strategic assets that are extremely difficult to replicate: licensed spectrum, network infrastructure, subscriber management, wholesale connectivity and operational control of the mobile service. Fintechs, travel platforms and digital wallets have a different advantage: they own the customer interface, payment relationship and context in which the need for connectivity arises.”
A financial platform can identify when a user is exchanging currency or making an overseas transaction, while a travel app knows when a customer is booking a flight or hotel.
“The strongest model will therefore be embedded connectivity: operators provide the underlying network, while fintech, travel and commerce platforms distribute and contextualise the service.”
Under this model, consumers may not actively select an eSIM provider. Connectivity will instead become one component of a wider travel or financial experience.
“Customers may not consciously choose an eSIM provider at all; connectivity will simply be built into an experience they already use.”
Gusain believes telecom operators and fintech companies will generate more value through partnerships than by attempting to replicate one another’s business models. There may be cases in which operators expand into financial services or fintechs move deeper into mobile connectivity. However, vertical integration will not always represent the most efficient use of capital or expertise. “For a telecom operator to build a bank from scratch is just ineffective, just as it makes little sense for a bank or an eSIM provider to build its own mobile network. Each player focuses on its core strengths, which boosts the final result and the quality of the service.”
The trade-off is that commercial value must be shared between the network owner and the platform controlling distribution.
“But sharing the economics of a larger and more engaged customer base is often preferable to retaining all the economics of a smaller standalone product.”
For operators, this could mean shifting from direct customer acquisition towards wholesale connectivity, API access and embedded distribution agreements.
An invisible layer of the digital economy
Over the next five years, Gusain expects eSIM to become less visible as a standalone telecom product and more deeply integrated into banking, travel and loyalty platforms.
The companies best positioned to succeed will be those capable of combining network reliability with seamless distribution, payments and regulation. “The strongest proposition will come from an ecosystem combining reliable infrastructure, intuitive distribution, integrated payments and supportive regulation — not necessarily the company with the largest network.”
Telecom operators will remain essential, but their role may become less visible to the end customer.
“Telecom operators will remain indispensable because fintechs and travel platforms cannot replicate licensed spectrum or national infrastructure. However, they may become less visible, managing connectivity and provisioning while another brand owns the customer relationship.”
Operators can respond by making their networks easier to integrate through APIs and commercial partnerships.
Gusain concludes: “The future is not telcos versus fintechs, but interconnected platforms delivering connectivity, payments, identity and travel services as one seamless experience.”
