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07 June 2023

UAE ranks among world's top hubs for Islamic fintech start-ups

By Wam

The UAE has been ranked as one of the world’s top Islamic fintech hubs with the country home to 12 start-ups specialising in this field, a new analysis from the Dubai Chamber of Commerce and Industry has revealed.

The analysis, based on recent data from IFN Fintech, ranked the UAE fourth globally as an Islamic fintech hub. The UAE’s highly entrepreneurial culture, investments and strong business support were identified as key factors that have positioned the country as an attractive hub for Islamic fintech start-ups.

The findings of the analysis were released ahead of the Global Islamic Economy Summit, GIES 2018, in Dubai, the world’s largest summit dedicated to all aspects of the Islamic economy, which takes place on 30th and 31st October, 2018.

Malaysia claimed the top spot with 18 Islamic fintech start-ups, followed by the United Kingdom, UK, with 16, and Indonesia with 15. The UAE outperformed the United States which ranked fifth as the country is home to 11 start-ups operating in this field. India and Egypt claimed the sixth position with the two countries hosting a total of four start-ups each.

The analysis highlighted Dubai’s proactive approach to furthering the development of the Islamic fintech sector, as the emirate has introduced new initiatives and mechanisms to support growth within this market. Dubai International Financial Centre’s, DIFC, launch of its Fintech Hive accelerator was cited as a prime example of support for Islamic fintech start-ups. The initiative, structured as a 12-week accelerator programme, has helped start-ups raise US$10 million in funding following its launch in 2017.

According to findings, the crowdfunding vertical constitutes over a third of the global Islamic fintech market (35 percent). Banking software makes up another 17 percent of the market, followed by payments/remittance, and foreign exchange with a share of 13 percent. Other major segments include alternative / P2P finance (12 percent), and trading and investment (11 percent). Moreover, relatively smaller, yet fast growth verticals, include blockchain and cryptocurrencies (5 percent), challenger / digital banks (4 percent), insuretech (2 percent) and data and analytics (1 percent).

Commenting on the analysis, Majid Saif Al Ghurair, Chairman of Dubai Chamber and Board Member of the Dubai Islamic Economy Development Centre, DIEDC, said, "Fintech is fast emerging as a major growth area for the global Islamic economy, and Dubai is witnessing a lot of new activity in this space as the emirate strengthens its position as a top Islamic economy hub."

Al Ghurair noted that the growth of the Islamic fintech market will be one of the top issues discussed by industry experts, government officials and business leaders who are gathering in Dubai to attend GIES 2018. He added that the summit will provide an ideal platform to showcase Dubai’s progress on this front, as well as the advantages that the emirate can offer Islamic fintech start-ups from around the world.

GIES 2018 will attract the participation of 3,000 key decision makers and experts from the UAE and abroad. Participants will examine the challenges and opportunities in the global Islamic economy, which is projected to grow to $3 trillion by 2023 from $2.1 trillion in 2017, according to the latest State of the Global Islamic Economy Report.

Organised by Dubai Chamber and DIEDC with Thomson Reuters as Strategic Partner, GIES 2018 will be held under the theme "A Shared Future." A panel session dedicated to Islamic fintech will be hosted on the first day of the summit, which will be joined by Khalid Saad, CEO, Bahrain Fintech Bay, Bahrain; Oliver Rajic, CEO, Alpha Fintech, Singapore, and Harris Irfan, Chairman, Islamic Fintech Panel, UK.