The Middle East is a fertile ground for financial technology (fintech), thanks to favourable economic conditions, digital penetration and supportive regulations.
With credit growth expected to rise in the United Arab Emirates and Saudi Arabia and conditions looking promising in neighbouring countries, the fintech sector is on an upward curve.
Read on as we explore three key sectors expected to drive fintech adoption in the Middle East over the next few years and beyond.
Online Gaming
Video gaming and social gaming have become increasingly popular in the Middle East, with the once-secluded region opening its doors to new modes of entertainment.
According to industry reports, the Middle Eastern gaming market is valued at billions of dollars and continues to grow annually. This is a lucrative environment for fintech solutions to thrive.
The fintech sector has an exciting role in the gaming ecosystem, with microtransactions, digital wallets and in-game purchases becoming a staple of the modern-day gaming experience.
These features run on seamless payment systems created by fintech firms. Digital platforms such as PayPal, LuLu Money, Money Fellows and My Fatoorah allow gamers to make instant, secure payments to buy virtual goods and trade in-game assets.
Social gaming platforms use fintech to introduce loyalty programs and reward systems that keep players engaged and invested.
For example, games built on the subscription model require fintech solutions to ensure a constantly flowing revenue stream for premium content.
Fintech companies use gaming platforms to introduce young players to financial literacy. They help to teach young adults about savings, investments and responsible spending.
iGaming
The iGaming comprises online casinos and sports betting, elements typically frowned upon by Islamic religion and consequently prohibited by law.
However, several countries have begun to make a U-turn on their stance, realising the potential economic windfall from taxation is massive.
Many of the MuchBetter Casino Online platforms featured on respected comparison website Haz-Tayeb have set the benchmark for secure and user-friendly fintech integrations.
They are generally fortified with biometric security, allowing players to make instant deposits and withdrawals. The apps are carefully curated to address critical pain points for users and operators.
MuchBetter prioritises security and simplicity, creating a seamless payment system players trust, a crucial element in the highly-regulated iGaming market.
The success of MuchBetter in the tricky Middle Eastern market shows how fintech can help bridge massive gaps in specialised industries.
With several governments across the region considering adjusting their regulatory stance towards the iGaming sector, the demand for sophisticated fintech solutions will continue soaring.
Cross-Border Payments
The Middle East is keen on bolstering its reputation as a global trade hub, and cross-border payments are critical for those plans to come to fruition, opening the door for innovation.
Traditional payment methods often have fees attached, while processing times can be frustrating. There are no guarantees that money will move smoothly amid complex regulatory requirements.
Fintech solutions address these challenges, offering faster, cheaper and more transparent alternatives.
The UAE and Saudi Arabia are trendsetters in the Middle East. With their citizens rapidly adopting digital payment platforms for cross-border transactions, the rest of the region will likely take a leaf out of their book.
Start-ups such as Ripple and TransferWise have developed blockchain solutions that enable real-time settlements at a fraction of the traditional transfer costs.
These advancements are useful to the large concentration of expatriates in the region. They frequently send remittances to families in their home country.
Fintech platforms also help to streamline cross-border payments for businesses. Small and medium-scale enterprises (SMEs) leverage fintech innovations to access multi-currency accounts that convert funds instantly and create automatic invoices.
These features make operations more efficient while encouraging financial inclusion for SMEs across borders.
Fintech innovations also aid compliance with anti-money laundering (AML) and Know Your Customer (KYC) protocols, which are crucial for cross-border transactions.
By integrating artificial intelligence (AI) and machine learning, businesses identify and mitigate risks better, ensuring they stay in line with the regulatory framework without compromising on speed while delivering excellent user experience.
