Payment platforms account for 40% of FinTech Businesses in the GCC
A newly released report from BCG showed that 7% of all FinTech Companies in the Middle East and Africa are concentrated in the GCC
The Boston Consulting Group (BCG) has recently released a report highlighting the impact of payment solutions, which account for 40% of all FinTech business in the GCC. Despite receiving minimal funding when compared to other mature markets, the region has experience significant growth in the last few years.
Since 2000, the global FinTech market space has expanded, and in the last six years, the sectors has almost doubled. No numbering over 8,000 companies and boasts a total funding total funding experiencing a growth of 80% from $15.3b to $78.6b
Godfrey Sullivan, Partner & Managing Director of BCG Middle East, shared: "We are witnessing growing innovation throughout the Middle East, and that is reflected in the gradual development of the FinTech sector across the region. Emerging start-ups are utilizing leading edge technologies to sidestep the constraints of legacy cost structures."
He added: "The emergence of new sectors in the FinTech space is mirrored by the MEA market; we are just beginning to see the arrival of crowdfunding/lending, blockchain and particularly payment FinTech businesses cropping up across the region."
While typically focused on capitalizing on retail, corporate and SME space, FinTech firms can also impact capital markets are also being impacted due to the growth of trade and investment, blockchain technology and data analytics.
"There is a penchant for technological innovation emerging from the Middle East. As a bridge between east and west, this market is privy to the halo effect of disruption in the financial markets from all corners of the globe, hence more and more FinTech startups that address the requirements of both regions, have emerged," Sullivan added.
"The dynamic changes in the financial ecosystem spawn the growth of innovation opportunities; to further this it is imperative to establish a grounded regulatory environment for new players entering the financial ecosystem."