MENA FinTechs raised over $100 million in funding in the last 10 years, and the number of startups launched and investments raised will more than double by 2020, according to research by the Wamda Research Lab and Payfort.
Startups aim to raise $50 million in funding this year, compared to the $18 million in disclosed investments in 2016. The region’s largest single disclosed investment is $6 million, for Egyptian bill presentment service Fawry in 2013 and online payment gateway Telr in 2014. Wamda Capital partner Khaled Talhouni says the rate of change in the region from a cash economy to a cashless one would be “exponential…With FinTech, the challenge is that there are very little grey zones, it’s mostly black and white, but we will work to support startups in this sector.”
Financial free zone Abu Dhabi Global Markets intends to work with other stakeholders to create regulation, rather than building a FinTech framework in a vacuum. “There will be very large companies coming out of this sector and they will be the ones that are tailored to this region,” says Beco Capital managing partner Alvaro Abella. In addition, in MENA 86% of the adult population is unbanked, whilst SME lending by regional banks is 50% below the middle income countries average.