Open banking platform Tarabut Gateway has teamed up with Bahrain-licensed cryptocurrency exchange Rain to allow customers to top up their crypto wallets in a faster and cheaper way.
The partnership will enable accounts to be topped up directly from users' bank accounts without the need to leave Rain’s platform.
The new feature will use the platform’s open banking payment solutions to speed up transactions and reduce errors associated with traditional bank wire transfers, Tarabut Gateway said on Tuesday.
“We’re delighted to unveil a solution that aims to make fiat-to-crypto transfers quicker, more secure and cost-effective — as well as enable such funding methods directly from bank accounts,” said Abdulla Almoayed, founder and chief executive of Tarabut Gateway.
“Our partnership with Rain is a perfect cross-sector synergy, made possible by Bahrain’s advanced open banking ecosystem. Crypto trading, wallets and other blockchain use cases are natural allies in opening up traditional banking and finance.”
Open banking is a technology that global lenders have embraced to revolutionise the traditional banking model and boost profit as they jostle to engage retail customers on a personal level and drive new areas of growth.
It allows banks to share customer data such as transaction history and spending patterns with regulated third-party providers — with the account holder’s consent.
An open banking platform gives a customer access to accounts from different banks, credit card providers and other financial services companies, allowing them to easily and instantly make transfers between them.
Third-party FinTech platforms, such as Tarabut Gateway, point customers towards financial services and products tailored to their specific needs by analysing their spending habits.
Tarabut Gateway, founded in 2017, is licensed by global regulators such as the Central Bank of Bahrain and the Dubai Financial Services Authority.
It is also permitted by the Saudi Central Bank to test its services under the Regulatory Sandbox environment.
The platform, which has partnerships with several banks, financial institutions and FinTech companies across the region, raised $13 million in a seed-funding round in 2021.
The funding round was led by Berlin-based venture capital firm Target Global and it was followed by another $12 million in a pre-Series A funding round led by Tiger Global.
The market size of the global open banking industry is set to hit $43.15 billion by 2026, at a compound annual growth rate of 24.4 per cent, according to Allied Market Research.
Rain chief executive Joseph Dallago said the partnership with Tarabut Gateway would unlock “a new era for crypto assets adoption in the region”.
“Through quick and efficient deposit mechanisms, crypto traders on Rain’s platform will now be able to seamlessly fund their accounts and capitalise on market movements,” he said.
Through its subsidiary, Rain Management, a digital asset broker and custodian licensed by the Central Bank of Bahrain, Rain offers users a space to buy, sell and store cryptocurrency assets.
Rain was founded in 2017 by Abdullah Almoaiqel, AJ Nelson, Joseph Dallago and Yehia Badawy. In 2019, Rain Management became the first licensed cryptocurrency asset service provider in the Middle East.
A 2021 survey by FinTech company Finastra revealed that open banking was a “must have” for more than half of financial institutions around the world.
Globally, more than nine in 10 financial institutions said open banking was important to their organisation.
The UAE leads the way in terms of open banking’s importance, with 68 per cent of financial institutions saying it is a “must have”, followed by 58 per cent in Hong Kong and 56 per cent in Singapore, the survey found.
Among global financial institutions that have already integrated open banking into their operations, 97 per cent said it provided benefits to their business, such as improving customer service or experience, attracting customers — new and existing — and delivering new services, according to the survey.