Islamic or Sharia-compliant Fintech services are being increasingly adopted in Saudi Arabia, the United Arab Emirates (UAE) and internationally as well, according to a report from Arabian Business.
As reported by the news outlet, the largest transaction volumes have come from Saudi Arabia, the UAE, Malaysia and Indonesia.
The Dubai free zone, which provides business licenses to foreign-owned companies (with each zone focused on one or more industry categories and only issues licenses within those segments), has been established to support various initiatives. This also includes a regulatory framework for crypto-related firms.
Notably, Saudi Arabia has now spent around $4.5 billion on industrial support (during 2020). Meanwhile, the UAE’s largest Islamic bank has helped 54,000 clients with gaining access to modern financial services throughout the COVID-19 crisis.
In addition to these developments, Fintech transaction volume among OIC (Organization of Islamic Cooperation) member countries was estimated at roughly $49 billion last year (with Saudi Arabia and the UAE maintaining their lead).
In another update from Arabian Business Global, it has been revealed that BigTech and Fintech are beginning to compete more meaningfully with the traditional banking sector. Analysts claim that these banking and Fintech challengers could acquire a substantial share of the market from incumbents.
Digitization or digital transformation has taken the MENA region and the world by storm, a trend that has accelerated during the pandemic. Technology and advanced analytics platforms are now a key part of many industries across the globe.
Large banking institutions are also focused on their business transformation strategies. They’re launching their own digital banking solutions in order to maintain their market presence. Digital is no longer just a choice, it’s essential and inevitable, according to most industry experts.
The global neobanking and digital banking landscape continues to evolve rapidly with many new challengers entering and establishing a firm presence in the market.
In the MENA region, the Qatar Development Bank (QDB) and creative startup hub M7 have launched incubators to support tech firms and other businesses.
Regtech, financial wellness, and debt investments startups were among several different initiatives to graduate from StartupBootCamp Fintech Dubai.
Also in the MENA region, Dayra, an Egyptian credit solutions Fintech for gig workers, recently secured $3 million in funding, and joined Y Combinator as well.