Within the MENA region, 70% of fintech investment went to the United Arab Emirates in 2019 (the most recent year with data over 12 months) followed by Bahrain. Qatar is also accelerating the development of its fintech ecosystem
Investors poured $30.4 billion into fintech companies globally in the first nine months of 2020, according to the Qatar Financial Centre and Refinitiv—and Qatar is making its pitch to increase its share.
Although the Middle East and North Africa (MENA) region accounted for less than 1% of global investments in 2019, the figures suggest the region is becoming increasingly attractive for investors.
The Qatar Fintech Report 2021 highlights the exponential growth of global fintech investments from just under $ 1 billion in 2008 to an estimated $34.5 billion by the end of 2019.
Despite jarring global economic uncertainty and financial market volatility brought on by the Covid-19 pandemic, fintech investment levels globally remained relatively stable during the first nine months of 2020.
The largest investments were in payments, securing a quarter of venture capital funding, followed by digital banking and capital market solutions. The Qatar Financial Centre says Qatar’s current strategic fintech interests are closely aligned to those areas.
Within the MENA region, 70% of fintech investment went to the United Arab Emirates in 2019 (the most recent year with data over 12 months) followed by Bahrain.
Qatar is also accelerating the development of its fintech ecosystem.
The global outbreak of the Covid-19 pandemic came as a wakeup call for traditional financial institutions in MENA markets and spurred growth opportunities in Qatar and elsewhere. In particular, the pandemic accelerated the implementation of digitalisation strategies in Qatar’s financial marketplace.
Nadim Najjar, managing director for theMiddle East and Africa at Refinitiv, says: “Although this funding performance indicates significantly slower fintech adoption in the region, it is also a sign of substantial untapped potential, especially in the Gulf.”
“Key drivers for fintech solutions in the Gulf include above average GDP per capita, high internet and online payment penetration, as well as shifting consumer preferences away from traditional financial institutions.”
Yousuf Mohamed Al-Jaida, chief executive officer of the Qatar Financial Centre, says Qatar stands ready to support “new opportunities for financial innovation, which has attracted an influx of tech and fintech companies seeking to set up operations in Qatar”.
Al-Jaida continues: “The country offers fintechs worldwide substantial opportunities domestically as an unsaturated market with ICT spending expected to reach $9 billion by 2024, boosting the competitiveness of its market and strengthening its position to emerge as a fintech hub in the region.”
“Qatar has made remarkable progress in the fintech space in a very short time. Several major developments have taken place in the last year, including the launch of Qatar’s National FinTech Strategy, the Qatar FinTech Hub (QFTH) and its incubator and accelerator programmes, as well as the Qatar Financial Centre (QFC) Fintech Circle and Tech Talk series to buttress the local ecosystem.”