The Fintech Revolution: Top Trends Shaping the MENA Financial Landscape

The Middle East and North Africa (MENA) region, characterised by its diverse culture and oil-rich lands, is also becoming a hotbed for fintech innovation. With a largely unbanked or underbanked population and a significant youth demographic driving tech adoption, the fintech industry is projected to reach a $3.5bn valuation by 2025. This article explores the key trends in the MENA fintech sector and their impact on the financial industry.

1. Contactless Payments and E-wallets:

The COVID-19 pandemic accelerated the adoption of cashless and contactless payments, offering safety and convenience. SoftPOS, for instance, leverages NFC technology to transform Android devices into POS devices without extra hardware or installation, providing a simple, user-friendly solution for small and micro sellers in emerging markets.

2. Cross-Border Payments:

The growing trend of online transactions and e-commerce in MENA, supported by high smartphone penetration, has increased demand for faster, cheaper cross-border digital payments. This has allowed non-bank players, such as telecommunications providers, retailers, and startups, to develop innovative payment methods, including mobile number fund transfers, social payments, NFC and blockchain technology.

3. Challenger Banks:

The rapid digital transformation in MENA has led to a shift away from legacy banks towards digital banks offering modern financial services. These challenger banks, such as CBD Now and Meem by Gulf International Bank, provide tailored solutions to the region's unique economic landscape.

4. Buy Now, Pay Later (BNPL) Services:

The COVID-19 pandemic sparked a surge in e-commerce activities but also led to financial uncertainty for many. As a result, BNPL services, such as Tabby, have emerged as a popular solution, allowing shoppers to spread the cost of their purchases over a set period. Over the past three years, this trend has seen more than 10 BNPL startups launch in the region.

These trends highlight the vast fintech innovation occurring within the MENA region. As a result, businesses in the area stand to benefit from the automation and digitisation offered by these startups, increasing revenue and enhancing financial services for all.