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The Bahrain Economic Development Board (EDB) and FinTech Consortium recently announced the launch of Bahrain FinTech Bay, among the largest dedicated financial technology (fintech) hubs in the Middle East and Africa.
“Fintech Bay is not just a space, it is a whole ecosystem that sits on top of the space,” says FinTech Bay chief executive Khalid Saad, referring to the 10,000 square foot space in Manama’s Arcapita building.
The public-private initiative aims to support the development and acceleration of Fintech firms, as well as the interaction between investors, entrepreneurs, government bodies and financial institutions.
The offices house co-working spaces, communal areas and workstations, but also offer extensive support for companies interested in the fintech sector. Services for start-ups include one-stop business setup through the EDB, as well as support for attracting customers and investment. The hub also creates a space for existing companies to learn about fintech and test out new ideas.
To date, more than two dozen corporations, including Cisco, Microsoft and Batelco, have signed on as sponsors. “Our partners all bought into the vision that fintech touches upon everybody,” says Mr Saad.
“It is important to embrace innovation, and it is important to collectively move together.”
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While Bahrain has seen a decline in oil prices over the past few years, it has also seen growth in non-oil sectors, which expanded by 4.8 per cent in the first three quarters of 2017. “By global standards, Bahrain has a highly diversified economy,” says EDB chief economist Jarmo Kotilaine. “The oil sector comprises less than 20 per cent of GDP in real terms, financial services are at around 17 per cent, manufacturing is at around 14 per cent, and a number of other sectors are pushing towards the 10 per cent mark.”
The launch of FinTech Bayfollows on the heels of the Central Bank of Bahrain’s (CBB) fintech regulatory sandbox, established in June to allow start-ups and fintech firms to test and experiment with their banking ideas and solutions. The framework provides a virtual space for local and foreign companies to test new products and services on a limited number of customers, for a duration of nine months, with a maximum extension of three months.
“We are the only regional jurisdiction with dedicated financial technology regulations in the whole region,” says Mr Saad, arguing that Bahrain continues to be the most appealing location for fintech across the Middle East and North Africa.