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The UAE leads new fintech index, but a host of countries championing fintech apps

Fintech is burgeoning in the region and the UAE is a leader on many fronts, including being in a league of champions for fintech apps

The Arab Monetary Fund launched the Index of Modern Financial Technologies in the Arab countries In the UAE, digital payments have more than doubled over the last two years Egyptian payment portal myFawry had over 1.6 million downloads last year

The Arab Monetary Fund launched the Index of Modern Financial Technologies in the Arab countries, FinxAr.  

The UAE leads the Arab countries with an average of 75%. FinxAr consists of six main indices that represent the main pillars of the fintech ecosystem, including policies and legislation, the demand side, access to finance, financial markets infrastructure, talent development to support innovations, and finally, collaboration and partnerships.

The general index scored 43%, and the indices for talents and collaboration & partnerships came in the forefront with 50% and 49% respectively, then the demand side and policies & regulations indices by 44% each, while the results highlighted the need to pay attention to the pillars of financial market infrastructure and finance, as they scored 39% and 18%, respectively.

The average number of payment cards owned by a UAE bank customer is two, indicating the competition in the bank industry is intense. Banks are innovating themselves by investing in technological developments to improve their marketing activities, offers, and customer services.  

The high demand in the digital sales platforms directly caused a growth in digital payments. A rivalry exists between e-commerce platforms to provide the best service to customers like offering a large-scale selection of goods, same-day delivery, and infrastructure to provide a quick payment procedure that is secure and user-friendly.

In the UAE, digital payments have more than doubled over the last two years to $18.5 billion in 2020, according to Fintech company Stripe. Two-thirds of UAE residents expect the country to become fully cashless by 2030, a poll by Standard Chartered showed.

Fintech and banking

The UAE government has decentralized its approach to Fintech by introducing more than 40 ‘free zones’ among the seven Emirates, where rules and regulations applicable to companies differ from those applicable to companies operating on the mainland.

In terms of neobanks in the UAE, there are Liv and E20 by Emirates NBD, Mashreq Neo by Mashreq Bank, and ADCB Hayyak by Abu Dhabi Commercial Bank.

In the UAE, the current framework for fintech licenses requires companies to partner with a bank, which has to own 51% of the venture. Such collaborations include NOW and Commercial Bank of Dubai (CBD), as well as Rise and United Arab Bank.

Champions of fintech apps

Forbes Middle East has released a list of the region’s Top 15 Fintech Apps 2021, helping customers make payments, remit money, borrow and invest online.

The list was based on the amount of money executed through the app in 2020, the number of downloads and active users, and the date of establishment. Fintech applications owned by traditional banks and telecommunication firms were excluded.

Egyptian payment portal myFawry topped the ranking with over 1.6 million downloads last year. Remittances and money transfer platforms Al Ansari Exchange Mobile App in the UAE and Kuwait-based Al Mulla Exchange placed second and third, respectively.

Kuwait’s FinFirst Capital is the youngest app featured at 14th position. The financial services marketplace has conducted 5,000 transactions worth a total of $60 million.

The companies featured on this list amassed a combined total of 9.5 million downloads and processed $6.9 bn worth of transactions in 2020. The apps represent five countries. Six are headquartered in the U.A.E., followed by four in Egypt, three in Kuwait, and one each in Jordan and Saudi Arabia.

Click here for a complete ranking.