(Article by: Arabnet Beirut)
The Fintech sector has disrupted the financial world and revolutionized the way businesses are launched, accept payments, and scale. The number of Fintech startups in MENA has been growing rapidly especially in the last few years.
Lebanon is no exception in having a thriving fintech startup scene. While governments and authorities are imposing strict regulations on banks, they are providing Fintech startups with a regulatory environment to bring even greater disruption to the banking sector.
An example of such in the MENA region would be BDL’s Circular 331 that guarantees that 75% of the banks’ investments in the knowledge economy are through direct startup equity investment or indirect startup support entities.
With the introduction of the Circular, Lebanon has been increasing the number of Fintech startups founded each year. Out of over 100 startups, Lebanon is home to 16 Fintech startups, ranking third regionally in number of Fintechs, according to in-depth research by Arabnet.
Among those startups, digital banking ones are by far the biggest category probably due to the less regulatory restrictions when collaborating with banks.
Not only have the number of startups increased, but so has the amount of investment. Based on Arabnet’s in-depth research from 2001 till 2017, investments in Fintech startups in the region have amounted to over $200M whereby Lebanese Fintech startups ranked fourth regionally in value of investments.
What is not surprising is that the digital banking category also captures the largest amount of investment. These investments provide startups with the necessary funding to develop and grow their startups leading to the development of the whole industry as well. On the other hand, personal financial management startups are second in number of startups, yet it receives the lowest amount of investment.
Lebanon surely has a diverse and lively ecosystem especially in the Fintech sector. Such an ecosystem feeds investors’ needs as they have already invested in Lebanese Fintech startups. Those investors include such as [email protected], Flat6Labs Beirut, Saned, MEVP and UK Tech Hub.
Every entrepreneurial ecosystem needs a hub that fosters innovation and technology. For that reason, StartechEUS FinHub, a new Fintech hub, has just launched in Beirut to assist and mentor startups from the concept stage.
This hub is a one-stop-shop for entrepreneurs providing them with funding, Fintech office space, relevant trainings delivered by domain experts through StartechEUS Technology Academy, market research studies and market access to EU and USA, continuous support, management and mentorship.
With the advancements the Lebanese startup scene has witnessed the past few years, the future holds a lot of growth and development for such a fast growing ecosystem.