The financial technology market in Middle East and North Africa (MENA) region is currently estimated at $2 billion and expected to witness an annual growth of $125 million until 2022, consultancy MENA Research Partners (MRP) said in a recent report.
The agency said “increasingly compelling business models” are expected to drive the market growth in the future.
“Fintech startups in MENA region are witnessing a pronounced expansion with the introduction of new technologies to serve the financial industry,” Anthony Hobeika, chief executive Officer of MRP said in the report.
“Up until recently, banks considered fintech as a competitor but are now adopting what the sector needs to improve their own services,” he added.
According to MRP, fintech funding has been gaining traction over the past five years, reflecting investors’ rising interest.
This has led to new fintech startups, with six startups founded in 2005. The figure is expected to reach 252 by 2020, the report said.
Initially, regional fintech startups were mainly specialized in payments activities, Hobeika said, but 2015 saw the emergence of startups created for lending and capital raising.
This led to a second wave startups —those which are specialized in remittances, wealth management, insurance, and blockchain-based solutions, he added.
“In 2020, this industry is expected to have an equal distribution of startups between these three main activities,” Hobeika said.
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