New Lineage of Financial Sovereignty: Future of FinTech in the UAE

The world is entering the new age of digital finance, and financial technology is a pivotal element that will help shape the industry’s future. There is no denying that the COVID-19 pandemic played an integral role in altering the UAE’s financial services, going from unconnected traditional ones to becoming a critical and essential factor that revolutionized the current and future state of the financial industry. The Emirates has established fintech adoption and growth as its central national priority, shaping the path for digital financial services to become a profound innovation that would modernize the region’s financial status. Fintech in the UAE will prove to be a phenomenal sector reflecting the nation’s regional progress.

Is the Fintech Industry Growing in the UAE?

As the Middle East and North Africa’s (MENA) leading fintech market, the UAE aims to reach a record high of almost $2.5 billion in 2022 alone. A significant number can only be achievable through the Emirate’s support of its financial institution through the endorsement of the fintech industry, targeting payments, capital markets, and cybersecurity. So, why is the fintech industry growing?

As consumers direct their attention towards pumping their investments in more advanced financial products, such as end-to-end financial services, digital banking, wealth management, and payments, the fintech industry is proving that it might very well be the one the UAE’s leading industry. This growth results from the UAE’s implementation of well-thought-of financial strategies to deliver some of the world’s most prominent fintech establishments the needed reinforcement through offerings of economic and regulatory support, in parallel with the networking openings alongside a bundle of different services benefits.

Despite being relatively late to join the digital finance coalition, the UAE has proved to the world that it can be a crucial player in the fintech scene. In 2017 alone, the Central Bank of the UAE uncovered plans to release new licensing programs for digital payment services, only four years after the region became one of the largest markets adopting fintech innovations worldwide.

This has led the fintech industry to become one of the UAE’s fastest-growing industries in the GCC region, as the Emirate’s financial sector expands its horizons toward a sustainable and progressive future.

Fintech UAE Update

At the moment, the fintech industry in the UAE is a primal model in the evolution of the region’s financial sector as authorities intensify their focus on broadening their economic value within the area. In 2019, in the MENA region alone, fintech startups had magnified their capital to raise over $100 million in funding. They are expected to double, if not triple, by the end of 2023.

Now, Dubai has entered its next phase of empowering its financial sectors as it stirs global attraction towards its fintech sector. As one of the wealthiest of the seven emirates, Dubai taped talents as it embraced the upcoming phase of financial growth and directed itself to become a hub for startups by implementing a bundle of strategic maneuverings.

Through its support of the fintech startups, the city is encouraging an entrepreneurial community that would, in its own way, help drive the sector’s maturation. By implementing a flexible yet robust legislative system, strong and reliable financing tools, and a trustworthy regulatory environment, the city will be tooled with the needed requirements to steer the sector’s upsurge.

UAE Fintech Report

Just as the UAE’s fintech sector sustains its maturity with the hasty and extensive support of digital payments, mobile banking, blockchain and cryptocurrency, digital lending and credit, banking as a service (BaaS), and others, its financial landscape registered remarkable developments through these trends. The shift to digital approaches within the sector has up ticked a fundamental expansion. A progression much needed for the region to become a global hub for digital financial inclusion.

Following the COVID-19 pandemic, consumer behavior and payment preference shifted, with an estimate of two-thirds of UAE respondents revealing they now prefer the adoption of emerging digital payments. Methods they would have never thought of considering conducting their finances.

Digital banking, in particular, endured a rapid development, not just in the UAE, but in the MENA region as a whole, with almost 20 neobanks based in the region, operating to serve more than 15 million users. The UAE fintech report focuses on some of the most prominent digital banking platforms that were launched from within the region itself, such as Liv and E20 by Emirates NBD, Mashreq Neo by Mashreq Bank, and CBD by Dubai’s Commercial Bank.

New Lineage of Financial Sovereignty

The endless opportunities brought to the UAE through its accelerated adoption of digital payment solutions have placed it in a position of power in the region. Its well-developed and high-powered financial infrastructure attracted fintech startups to build a strong partnership with its private sector to support innovative digitally driven financial ventures.

The UAE managed to prove that through its implementation of these key initiatives, it can be positioned as a leading fintech and technology hub regionally and globally. The UAE Fintech Office, the National Innovation Strategy, and the National Artificial Intelligence Strategy 2031 will manifest into a new lineage of financial sovereignty.

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