Over the last few years, the FinTech industry in MEA has gone through positive transitions, due to enormous efforts from both the private and the public sector. FinTech firms are becoming an integral part of the modern banking industry in the region, and will continue to grow in the upcoming years as well.
Industry experts believe that this positive wave can bring several meaningful changes with a collaboration between banks and FinTech firms. While banks have the customer base, Fintech firms have efficient and cheap service solutions. Both the parties can benefit each other by working together.
“Both banks and FinTechs have common goals. Their partnership can bring valuable elements to the financial services space,” said Jayesh Patel, head of Liv, the digital banking unit of Dubai’s biggest lender, Emirates NBD.
By the end of 2022, the Fintech industry in the Middle East and Africa is forecasted to make up 8 percent of the total revenue of the region’s financial services. Driven by increased investment and customer demand, this number can even go higher.
Mr. Patel also stressed on the banks’ ability to launch new services quickly as well as the efficiency of FinTech firms in monetizing their innovations.
“FinTechs focus on specific issues, solve them and create an improved experience for the customer. This allows banks to add more services for their clients,” he told The National.
The global payment industry giant Visa, which works with FinTech firms and banks closely, has seen positive signs, as collaboration is happening in a well-planned way.
“FinTech start-ups can use resources, infrastructure and scale of traditional banks, while banks can harness the data analytics capabilities and low-cost model to improve customer experience and reduce operational costs,” said Otto Williams, Visa’s vice president and head of strategic partnerships – FinTech and ventures – for Central Europe, Middle East and Africa.
The Head of Retail Banking at Standard Chartered UAE, Sonny Zulu, explained the importance of growth of the FinTech industry. “Traditional banks cannot match the pace of FinTech innovation … [whereas] the latter cannot stand on their own. A partnership between them is a win-win situation that ensures compliance to financial regulations and consumer protection while capitalising on the trending innovations,” said Mr Zulu.
American multinational bank Citi has joined the FinTech revolution of the region as well, by announcing a FinTech challenge for companies based on the MENA.
“We are calling on FinTechs with relevant innovative solutions, ranging from existing enterprises to early stage start-ups. This will uncover innovative solutions for our clients,” said Emre Karter, treasury and trade solutions head for Mena, Pakistan and Turkey at Citi.
“By offering the FinTech community the opportunity to showcase their ideas, we hope to contribute in the development and growth of the overall financial ecosystem in the region,” Mr Karter added.