Emirates News Agency – FinTechs and banks unite for innovation at DIFC’s Dubai FinTech Summit Dialogues

DUBAI, 11th April 2023 (WAM) – Dubai International Financial Center (DIFC) hosted the second Dubai FinTech Summit (DFS) Dialogues, powered by Innovation Hub, where leaders of 10 leading regional banks and FinTechs discussed the challenges facing the financial sector and discussed how the industry can reduce risk and build robust, sustainable financial institutions.

Recent research from Report Ocean indicates that the global FinTech Lending Market was valued at approximately USD 573.05 billion in 2021 and is expected to grow at a healthy growth of more than 27.4% during the forecast period 2022-2029.

Mohammad AlBlooshi, Head of the DIFC Innovation Hub and FinTech Hive, hosted the roundtable and noted: “As an industry based on trust and confidence, we are currently seeing the banking sector experience a time of disruption. Given global headwinds, we have an opportunity to build more resilient institutions through collaboration between banks and fintech.”

He added, “Through convenors such as this roundtable and the first ever Dubai FinTech Summit in May, we are facilitating dialogue and collaboration opportunities for long-standing financial institutions, regulators and promising entrepreneurs to together map out how the sector can – and should – move forward .”

Despite being recognized as a major competitor to banks, the FinTech sector is expected to double from US$135.9 billion in 2021 to US$266.9 billion in 2027, according to the DIFC FinTech Hive’s 2022 FinTech Report. In addition, FinTechs have played a crucial role in promoting inclusive economic growth in the region, especially as approximately 50 percent of the MENA region is currently unbanked or underbanked.

However, a unanimous view from all banks at the DFS Dialogue was that both entities are indeed symbiotic.

Sanjay Sethi, Senior Managing Director and Head of Global Transaction Banking at First Abu Dhabi Bank, highlighted the importance of collaboration between financial institutions and FinTechs, stating that it is an age of collaboration and co-creation. He added that through collaboration, entities can embark on an innovative journey of discovery to expand into new geographies, improve product features, increase revenue, or scale or optimize their business faster and more efficiently. He stated that FinTech solutions in transaction banking are growing in agility every day and FAB will continue to partner with pioneering FinTechs to deliver impactful advancements in the financial industry.

The UAE Central Bank recently announced the implementation of its Digital Dirham digital currency strategy, which promises to be a critical step in the country’s payments industry. These developments will have a profound impact on banks, FinTechs, businesses and customers. “As such, the synergy between banks and FinTechs is proving to be inevitable as the industry moves towards a cashless economy,” AlBlooshi added.

Raman Thiagarajan, CEO and founder of Zenda, a FinTech services provider, emphasized that building an emotional connection with the end consumer is key, just as it is with any tech player.

As customers turn to technology, banks have been forced to adapt traditional trust building to complement the digitization of banking. Anand Krishnan, chief technology officer at Emirates Investment Bank, emphasized the importance of banks continuing to invest in technology that builds and maintains customer trust throughout the journey.

Google predicts that the finance and banking industry will emerge as the primary adopter of AI technology in MENA, accounting for nearly 25% of all AI investment in the region. Banking technology alone is expected to contribute 13.6% to the region’s gross domestic product by 2030.

Mehdi Tazi, Chief Operating Officer at Lean Technologies, noted: “Although customers still trust banks more than FinTechs due to their size and established reputation, FinTechs excel by streamlining customer onboarding processes in these larger banks. As a result, we a marriage between FinTech and banking that improves the customer journey, and ultimately builds trust.”

The financial sector is undergoing a transformation with the advent of Web 3.0, which is revolutionizing customer expectations and driving changes in financial services, capital markets and banking. According to Rakesh Reddy, CEO of Cloud4u, the total transaction value of embedded finance is estimated to reach USD 7tn by 2026, which will benefit Platform-as-a-Service (PaaS) providers, making them a significant industry disruptor.

Nilay Singh, Managing Director of State Bank of India, DIFC, emphasized the need for efficient and intelligent use of artificial intelligence (AI) through outsourcing and collaboration.

As Dubai prepares for further growth and innovation, policy makers, entrepreneurs and investors are coming together to improve inclusive and stable banking solutions in the region. Traditional financial firms are increasingly optimistic about developing partnerships with promising FinTechs to bridge gaps and stay ahead. Join the dialogue at the Dubai FinTech Summit, held at Madinat Jumeirah in Dubai, where visitors can purchase early-bird tickets available until 15 April 2023.