Out-Law / Your Daily Need-To-Know

Figures show rise in fintech registrations in Dubai

Out-Law News | 25 Sep 2019 | 3:27 pm | 2 min. read

The Dubai International Financial Centre (DIFC) has now registered over 100 fintech firms, reporting a three-fold growth in the number registered in the jurisdiction since the end of 2018.

The DIFC also said the number of fintech companies basing themselves in the centre has risen from 80 to 200 in the last six months. It had also seen an increase in the number of fintech firms applying to participate in its accelerator programmes, with a 42% year-on-year increase in applications for its third round of the Fintech Hive programme focusing on the regulatory, Islamic finance and insurance technology sectors.

Fintech expert Tom Bicknell of Pinsent Masons, the law firm behind Out-Law, said the rising number of registrations was part of a general trend in the Middle East.

“The increase in the number of fintech firms opting to register in the DIFC is evidence of the regional shift towards using technology to promote innovative ideas and solutions in all sectors, including financial,” Bicknell said.

The DIFC said firms newly registering covered a variety of sub-sectors, including digital banking and payment technology, and came from a range of jurisdictions, including the UK and Hong Kong. There was a similar variety in the regulated firms which have received the Dubai Financial Services Authority’s Innovation Testing Licence, which enables firms to test fintech solutions in or from the DIFC. Firms which have now received the licence include an online financial adviser, a securitisation platform powered by blockhain, and an investment platform for sukuk and capital markets.

DIFC Authority chief executive Arif Amiri said the rise in the number of registrations was a reflection of the DIFC’s commitment “to reinforcing Dubai’s position as one of the world’s top ten fintech hubs”.

The news is part of a wider boom in fintech activity in the Middle East. This year has seen the Abu Dhabi Global Market open to applications from firms looking to establish a digital banking business, after the creation of a digital banking framework, while Bahrain is implementing open banking regulations which underpin the use of technology.

More recently, the United Arab Emirates Central Bank has given banks and other financial institutions permission to use a new digital identity app as an online validation gateway for ‘know your client’ purposes.