Global Ventures, a Dubai-based venture capital firm that recently finalized a $50 million investment round, has released a new report that discusses the state of Fintech in the Middle East region.
Global Ventures’ extensive 59-page report covers the ongoing growth and development of the Fintech sector in the MENA region by sector and solutions offered. It also looks into important financial technology development drivers, government initiatives, regulatory measures, and how the sector is expected to perform in the future.
Nearly all the countries based in the MENA region have been focused on further diversifying their economies by attempting to reduce their dependence on natural resources, such as oil which has hit historic lows due to the Coronavirus (COVID-19) crisis.
The report from the VC firm notes that governments and organizations in the Middle East are becoming more flexible with their regulatory requirements, in order to support innovative projects.
Countries in the MENA region are increasingly moving towards knowledge-based economies, which involve extensive research and development (R&D). These efforts could become the main drivers of growth, the report argues.
It adds that regulating authorities in the region are supporting various projects that aim to make it easier for early-stage Fintech firms to do business with local entities.
Specific and focused measures have been taken to introduce regulations for innovative Fintech projects.
The reserve banks of several Middle Eastern countries have helped with establishing regulatory frameworks. Economic free zones have also been launched in order to support new Fintech initiatives.
MENA region’s governments continue to set up sandbox programs to make it easier for Fintech startups to test out their newly developed services in a controlled environment.
Several regional and international organizations have launched financial technology accelerators and incubators, including the Abu Dhabi Global Markets (ADGM) Plug & Play, the Dubai International Financial Centre (DIFC) Fintech Hive, and the Economic Development Board (EDB)’s Bahrain Fintech Bay.
The Monetary Authority in Saudi Arabia has also been focused on supporting innovative projects. It recently approved applications submitted by several Fintech firms to take part in a national regulatory sandbox program.