The UAE’s fintech sector has strengthened its important position, after witnessing major developments over the past few years, which contributed to strengthening the country’s position as a global hub in this sector. Local banks alone have invested more than AED 3.7 billion in the sector over the past years, while the UAE has increased its share of global investments in the fintech sector, benefiting from the advanced digital and technological infrastructure, the flexibility of the financial work environment, in addition to the UAE being a home and primary destination for many global wealth. The fintech sector plays an important role in driving economic growth, by providing new job opportunities, enhancing financial inclusion, and driving innovation.
Jamal Saleh, Director General of the UAE Banks Federation, said that the digital transformation journey, under the supervision and guidance of the Central Bank of the UAE, has contributed to strengthening the financial technology sector in the country, noting that local banks’ investments in the sector have contributed to providing the best technological and digital services to customers in a safe and reliable banking environment. He stressed that the Central Bank is a pioneer in developing the necessary legislative and regulatory frameworks, which has consolidated the UAE’s position as a regional hub for financial technology, adding that in light of this stimulating environment and the growing demand for advanced digital financial services, the prospects for the growth of financial technology locally appear promising. He pointed out the importance of financial and banking institutions cooperating with financial technology companies in developing innovative solutions to meet the requirements of various customer segments, by combining their combined banking and financial expertise and capabilities, and the broad horizons of advanced technologies, especially in data analysis and artificial intelligence capabilities, noting that financial technology requires more qualitative investments to keep pace with developments and align between meeting customer requirements and ensuring a safe and smooth system. According to KPMG, the UAE continues to evolve into a regional hub for fintech, attracting additional interest from global investors and larger deal sizes.
According to Innovate Finance, a financial and advisory services firm, despite a 42 percent decline in global investments in financial technology in 2023, these investments in the UAE increased by about 92 percent in this sector to reach $1.3 billion through 54 deals, ranking among the top ten for the first time, supported by financial technology-friendly regulations and widespread adoption of digital banking services.
For his part, Nour Sabri, Senior Director at Accenture Global Consulting, said that many factors contributed to the growth of the fintech sector in the UAE, most notably the proactive and highly flexible regulatory environment that was able to create a legislative environment for the work of fintech companies and the sector in general.
He stressed that the UAE is considered a country with high liquidity, whether in terms of local wealth or in terms of being a major destination for global wealth, in addition to the development of the digital and technological environment, the abundance of free zones that attract new investments, as well as the advanced financial work environment.