The Dubai International Financial centre, the region's financial centre, has doubled down on its commitment to propelling the growth of fintech with two new accelerator programmes designed to boost investment in the fast-growing field.
The financial centre, in partnership with the business management consultancy Accenture, this year launched its first accelerator programme that saw 11 fintech firms out of over 200 applicants being accepted into DIFC's mentorship. That programme gives fintech companies with a proven track record advice and makes connections for them with financial service firms looking for technological solutions to bring about greater operational nimbleness. It also helps them find investors.
"Building on our success as one of the world's top ten financial centres, we began this year with the launch of a first-of-its-kind accelerator to the Middle East, Africa and South Asia region, as a key part of building a comprehensive FinTech ecosystem," said Arif Amiri, chief executive of the DIFC Authority.
"We are delighted to announce that we are tripling our commitment to FinTech in 2018. In addition to Fintech Hive at DIFC, we will be running two new programmes, with a focus on RegTech and InsurTech, reinforcing our role in shaping the future of financial services for the MEASA region.”
Raja Al Mazrouei, acting executive vice president of Fintech Hive at the Dubai International Financial centre, said the two programmes will start next year. The InsurTech will focus on startups that specialise in finding technological solutions for insurance companies, while RegTech will focus on companies specialised in issues pertaining to regulation.
She said that the DIFC was making fintech a priority, especially as the industry fits into the Emirate's longstanding efforts to encourage the growth of small and medium sized businesses. So far, over a dozen banks and financial services firms have partnered with the financial centre to get connected with fintech companies to seek technology and artificial intelligence. These technologies include so-called robo-advisory for wealth management investment decisions and distributed ledger technology that speeds the time it takes to make a transfer.
Banks in the UAE have not been oblivious to the technological developments transforming the financial services industry. Over the past couple of years, they have been investing heavily in digital and artificial intelligence as consumers increasingly favour online banking over going to a physical branch.
Investments in technology and digitisation are also timely for UAE banks as profitability has been on the wane in the wake of the biggest oil price slump since the 2008 financial crash. Lenders are fortunate that this country has one of the highest smartphone penetration rates in the world.
DIFC is not the only financial centre in town pushing fintech. Abu Dhabi Global Market, the Emirate's financial hub, wants its fintech initiatives to be the catalyst for a revolution in financial services across the Middle East and Africa. Around 80 per cent of the region's population doesn't have a bank account and small businesses face a funding gap of US$260 billion, according to ADGM.
Fintech start-ups specialising in artificial intelligence, digital payments and robo-advisory were among 11 local and international companies selected by Abu Dhabi Global Market last month for the second round of its RegLab incubation programme.
The free zone selected the companies from 22 applicants for the programme, double the number that applied for the first round last year.