Writing the next chapter in the Middle East fintech success story


In recent years, the GCC has successfully put itself on the map as a rising center for financial technology (fintech). New fintech hubs have emerged across the region, are funding dynamic small companies, and taking a growing number of them public. In 2021 alone, the volume of late-stage funding rounds totaled $2.5 billion—almost double the amount five years ago.

While GCC fintech has come far and fast, the region should not rest on its laurels. Fintech globally is highly competitive and fast developing because digital technologies are opening new possibilities. After a promising start, the GCC must now to build on this momentum to achieve strong and sustainable fintech growth. Doing so will boost financial services and the GCC’s overall ambitions of economic diversification and increased innovation.

The number of fintech hubs in the GCC has risen from just one in 2018 to four in 2022: the Abu Dhabi Global Market, Bahrain Fintech Bay, Fintech Saudi, and the FinTech Hive at the Dubai international Financial Centre. The amount of fintech investment in the broader Middle East and North Africa region reached $448 million in 2021, with 108 transactions involving fintechs. These included four fintech “exits”, the highest for a single year.

“The payments sector has seen particularly strong growth, with 30 payment fintechs now operating in Saudi Arabia alone.”

Despite the changed economic and geopolitical context in 2022, the outlook remains buoyant. In August 2020, the valuation of Egypt’s Fawry e-payment platform exceeded $1 billion, achieving unicorn status, and other high-profile companies including stc pay have followed. Some of the major recent developments have been in Saudi Arabia, encouraged by its National Fintech Strategy 2030. The payments sector has seen particularly strong growth, with 30 payment fintechs now operating in Saudi Arabia alone.

Supportive regulation is fueling this growth. Bahrain, Saudi Arabia, Qatar, and the UAE have all designed national fintech strategies and set up government-sponsored accelerators and incubators. Regulatory “sandboxes” have allowed room for experimentation. The availability of government funding and widespread access to broadband including high smartphone penetration have also contributed.

Greater private sector involvement is imperative if fintech is to grow and become stronger. Scaling up, in turn, will require improved access to capital, easier exits for investors. It also needs a major effort to attract the experienced professionals who can build innovative fintech businesses and deliver support services such as accounting, payroll, legal, growth marketing, and sales.

Similarly, fintech in the region needs more funding. There is less venture capital funding in the GCC than there could be. For example, the Saudi share of global venture capital funding is just 0.08 percent, whereas the country accounts for 0.9 percent of global GDP.

The fintech outlook in the GCC will depend largely on how successfully the region can overcome current market fragmentation. One issue is that regulation is largely country-focused and sometimes prohibitive for cross-border providers. National restrictions on the location of data can impede greater cross-border activity. Another example is the lack of preferential regulatory treatment to companies that are licensed and regulated in other GCC countries.


Public sector and private sector stakeholders can overcome these issues by aligning on key aspects of market growth to allow easier provision of cross-border services. For example, GCC countries could enable startups to expand geographically without regulatory impediments through so-called passporting agreements. These are pacts between regulators in different jurisdictions that allow companies in one GCC country, for example, to operate in other GCC states based on their home-country rules.

Encouraging capital market growth demands a multi-pronged effort. A starting point is to develop a stronger local savings culture, for example devising investment vehicles that are attractive for domestic savers. Some of this can be done through regulatory changes to remove obstacles to investment funds, along with public campaigns to raise awareness about investment opportunities. Similarly, while IPOs have been blossoming, governments can do more to encourage them, including by simplifying the listing process for small companies.

Resolving the talent shortages is a long-term undertaking. Governments, fintech providers, and others can work with regional educational institutions to deepen the regional talent pool with requisite tech and support services skills. Attracting international talent requires new incentives and recruiting campaigns. There should also be a reconsideration of labor policies to make it easier and more attractive to work in the GCC.


GCC countries have done well thus far in their fintech story. Consolidating and building on those achievements will allow the region to remain a vibrant player in a dynamic global industry. Writing the next chapter requires continued focus and no letup in support.

About the authors

Patricia Keating is scale lead with PwC Middle East, and Dr. Antoine Khadige is a principal with Strategy& Middle East, part of the PwC network.

This article originally appeared in Gulf Business, October 2022.

Contact us

Patricia Keating

Patricia Keating

Scale Lead ME PwC Ventures, PwC Middle East

Dr. Antoine Khadige

Dr. Antoine Khadige

Partner, Strategy& Middle East