Dubai is being recognised as one of the world's top 10 fintech hubs, and nurturing innovation will help these firms capitalise on growth opportunities in the Middle East, Africa, and South Asia, Arif Amiri, CEO of the DIFC Authority, told Khaleej Times.
Dubai fintechs are gaining momentum and with tremendous government support, growth is inevitable. Amiri said: "Over the last three years, we've been able to build the region's most comprehensive offering for fintech firms. Over 160 fintech companies now operate from the DIFC. Part of our commitment includes investing in start-ups through our $100 million fintech fund. We invest to demonstrate our commitment to developing the sector and to help drive sustainable economic growth for Dubai. These start-ups will help us drive the future of finance."
The fintech fund was launched to help establish, grow, and upscale start-up and growth-stage fintech companies seeking access to Measa markets. "We will continue to invest so we can remain at the forefront of the fintech sector," Amiri added.
Recently, four startups - Sarwa, Flexxpay, Rise and Now Money - received funding from the DIFC and they intend to invest the same in the expansion of respective ventures. When the pandemic hit, traditional financial industries were struggling: reducing hours, closing branches, and services were disrupted. Fintechs were leading the space.
A robo-advisory wealth management firm, Sarwa is witnessing exponential growth and in April had 4x times the influx of new clients experienced the same time last year. The new funding will allow the startup to scale and reach a bigger audience as well as expand to other markets in the region.
"Our plan is also to develop more product offerings, between goals-based investing and employee workspace schemes," said Mark Chahwan, CEO, Sarwa. "The funds will allow us to scale and reach a bigger audience as well as expand to other markets in the region. our plan is also to develop more product offerings, between goals-based investing and employee workspace schemes, at the same time, Sarwa is witnessing exponential growth and in April we have four times the influx of new clients experienced at the same time last year. The funding will also be used towards growing the team - specifically the tech team - in order to continue providing a unique onboarding customer experience."
FlexxPay, a cloud-based B2B fintech employee benefits platform allows access to earned income. The startup enables users to access any sort of earned income (salaries, commissions, pensions, end of service benefits etc.) whenever they want to. We strongly believe that in a few years from now, everyone will have such access. We will no longer have to wait a month or two weeks (like in the US) for our salary or pension. You earned it, you can access it. This will have a very positive effect on the overall economy / GDP of a country. Money is put to work earlier, the money multiplier effect comes into play."
Michael Trüschler, CEO of Flexxpay, said: "The DIFC funding will be used to enhance our technology offering and for business development, such as the acquisition of corporate customers and geographical expansion."
Trüschler addded: "Covid-19 forces companies (and society) to digitally transform. Many companies knew that they have to digitise their businesses and processes but were reluctant to invest or simply took too much time. These are the companies that suffer now. COVID-19 is a sort of catalyst or accelerator forcing companies to take the necessary steps immediately to survive and grow in the current (new) reality."
Rise - the first fintech company in the Middle East launched with the mandate of empowering migrant workers - plans to use funding to speed up product roadmap, strengthening the team and continue building and bringing new migrant financial services products to life. The startup has a partnership with home-shopping channels in Pakistan, which allows overseas Pakistanis to buy products for their families back home on installments - a global first.
Padmini Gupta, CEO of Go Rise, said: "We're reimagining migrant financial services, helping 250 million-plus migrants who send home more than half a trillion dollars a year - be more in control of their money and build a better future. The DIFC is a great partner in building a global business that builds on one of the region's biggest strengths via migrants.
NOW Money provides payroll services to Gulf-based companies, and app-based accounts with physical debit card and remittance options for each of their lower-income workers. "We are delighted to welcome DIFC to the NOW Money family and look forward to sharing more on our partnership throughout 2020," said Ian Dillon, co-founder of NOW Money.
Checkout.com, the leading global payment solution provider and fintech unicorn, recently announced that it has tripled its valuation to $5.5 billion following a $150 million Series B funding round. The eight-year-old London-headquartered company already powers many of the world's leading enterprises, adding 500+ merchants to its books in the last twelve months including Grab, Revolut, Careem, Glovo, Robinhood, Farfetch, Klarna and Remitly.
Sebastian Reis, EVP Global e-commerce at Checkout.com, said: "Dubai is well known as a global financial centre and recognised as one of the world's top ten fintech hubs. In this ecosystem, supported by innovative regulatory frameworks and initiatives, fintechs are boosting the economy, creating jobs, increasing transparency, and increasing efficiency for all stakeholders. At Checkout.com, we have seen first-hand how the UAE fintech sector is thriving and are proud to help power its growth as we enlarge our global merchant portfolio with companies such as Talabat, Transferwise, and Careem.
77% of startups have not yet benefited from any government support policies, and 27% of investors are changing their mandate towards positively impacted technology-driven industries, our latest report on the impact of COVID-19 on MENA's startup ecosystem has found. Discover more in our FREE H1 2020 MENA Startup & VC Sentiment Report.