UAE FinTechs drive next phase of financial inclusion

By Vriti Gothi

Financial inclusion is becoming a core FinTech and infrastructure priority in the UAE as digital payments, payroll platforms, and regulatory oversight converge to support a largely low-income workforce. With more than 60% of employees earning below AED 5,000 per month, salary distribution mechanisms and associated financial rails are increasingly viewed as systemically important components of the country’s labour and payments ecosystem.

The Wage Protection System (WPS) has achieved near-universal digitisation of salary payments, embedding millions of workers into formal financial channels. However, FinTech adoption has historically stopped at the point of salary receipt, limiting the broader impact of digitalisation. Recent behavioural data from Edenred suggests this constraint is beginning to ease, with 2026 likely to mark a transition from digital wage compliance to functional financial inclusion.

One of the most significant developments is the sustained decline in cash dependency among low-income workers. Cash reliance has fallen from 84% to 69% over the past two years, representing the strongest reduction recorded since WPS was introduced. While many workers continue to withdraw salaries shortly after being paid, the growth of digital remittances and account-to-account transfers is accelerating. Improved multilingual user interfaces, transparent pricing models, and stronger fraud-prevention layers are driving adoption, indicating that salary-linked digital usage is becoming more embedded rather than purely transactional. If current trajectories continue, cash withdrawals are expected to fall below 60% in 2026, signalling a structural shift in the UAE’s low-income payments landscape.

At the platform level, payroll and salary-access solutions are evolving into integrated FinTech ecosystems. Originally designed to meet compliance requirements and replace cash payments, these platforms are now bundling remittances, bill payments, savings tools, and merchant acceptance into a single interface. For FinTech providers, this marks a strategic move from single-use payroll products to recurring-engagement infrastructure. Employers adopting integrated payroll ecosystems report higher workforce engagement and lower administrative friction, reinforcing the role of payroll apps as distribution channels for scalable FinTech services rather than simple wage-disbursement tools.

Rising product complexity is also reshaping how employers and FinTechs approach user enablement. Despite the UAE’s advanced digital economy, fewer than one-third of residents demonstrate basic financial literacy, a gap that becomes operationally significant as salary-linked credit, earned wage access, and embedded finance products gain traction. As a result, FinTechs are increasingly embedding education and usage guidance directly into payroll journeys, supported by multilingual onboarding and field-level activation. For employers, this reduces payroll-related disputes and operational overhead, while FinTech providers benefit from safer product usage and higher retention.

Regulatory pressure is adding further momentum to FinTech-led payroll modernisation. In the first half of 2025, more than 5,400 establishments were flagged by the Ministry of Human Resources and Emiratisation for labour-law violations following extensive inspections. Enforcement is pushing payroll compliance beyond periodic reporting toward real-time visibility and exception monitoring. FinTech platforms that provide employers with audit trails, wage-flow analytics, and automated compliance checks are becoming critical infrastructure, particularly as penalties for non-compliance escalate.

Looking ahead, artificial intelligence and data analytics are expected to play a growing role in workforce-focused FinTech models. AI-driven systems are increasingly used to detect anomalies in salary flows, flag potential fraud exposure, and identify early indicators of financial stress at scale. The strategic value lies not in automation alone, but in enabling targeted interventions through simple, multilingual prompts and alerts embedded within existing payroll platforms. As FinTech providers refine these capabilities, AI is likely to become a foundational layer in delivering more resilient, compliant, and inclusive payroll ecosystems.

Taken together, these shifts indicate that financial inclusion in the UAE is entering a more infrastructure-led phase. The focus is moving away from digitising cash replacement toward building compliant, data-rich FinTech platforms that support sustained digital usage, regulatory alignment, and scalable workforce engagement across the country’s labour market.