Launched on 7. March by the country’s central bank, the Qatar Fintech Strategy 2023 is looking to turn the nation into a technologically advanced state and a fintech powerhouse, with the broader ambition of boosting economic growth and making Qatar an attractive destination for foreign direct investment and fintech competencies.
The plan has set out ambitious targets for 2027, which, among other things, include at least triple the number of licensed fintech companies in the country, increase by 20 to 25 times the number of fintech jobs, generate 40 to 50 times direct economic value add, and improve financial inclusion.
Qatar Central Bank (QCB) governor Sheikh Bandar bin Mohammed bin Saoud Al-Thani detailed the four key pillars comprising the Qatar Fintech Strategy 2023 plan during an official launch event earlier this month, citing the establishment of a conducive infrastructure for fintech development, the prioritization of innovation and fintech growth, the expansion of the fintech talent pool, and the use of fintech for positive societal impact, as strategic areas of focus.
Delving deeper into the different initiatives that will be undertaken, the official said advanced regulatory rules, especially in the fields of digital banking, crowdfunding, open banking, buy now, pay later (BNPL), wealthtech, electronic know-your-customer (eKYC), and insurtech, will be developed to foster fintech innovation.
New rules tackling emerging technologies like cloud computing, artificial intelligence (AI) and distributed ledger technology (DLT) will also be introduced.
The regulator also named Islamic fintech, sustainable development and insurtech as critical fintech segments, and added that QCB will be collaborating with other government agencies and industry stakeholders to pursue numerous initiatives.
On the market infrastructure front, the central bank will be introducing a so-called Innovation Lab and will enhance its regulatory sandbox. It will also be developing an open banking architecture and API platform, as well as setting up the foundations for digital identity and eKYC.
On the talent front, the plan will seek to turn Qatar into “the leader in fintech knowledge, training and immersive learning experiences” by introducing initiatives such as a nationwide fintech internship program, developing capability-building programs for entrepreneurial talent, and establishing world-class fintech curriculum in partnership with universities. The country will also study the possibility of introducing a specialized talent visa program.
To encourage and support startup investment, the central bank will launch special programs dedicated to attracting venture capital (VC) firms and investors. It will also introduce forums to connect fintech companies with the investor community, and launch government-funded grants to support startups.
The QCB governor said that the national strategy falls in line with the Qatar National Vision 2030, which seeks to support the diversification and innovation in the financial sector and invest in a knowledge-based economy.
He added that, given the fast growth the Qatari fintech sector has witnessed these past years, he expects the Qatar Fintech Strategy 2023 to “provide tangible advantages over the next five years.”
Despite some progresses, the development of Qatar’s fintech market has been much slower than the country’s Middle Eastern counterparts, including Saudi Arabia and the United Arab Emirates (UAE), a predicament which Fitch Ratings analysts blame on the government’s reluctance to properly regulate the industry.
As of March 20, 2023, only six fintech companies had been granted a proper license by the central bank.
But the newly launched Qatar Fintech Strategy 2023 is setting the tone of the government’s overall stance on fintech and establishing the sector as a key driver of the country’s digital transformation, paving the way for much stronger growth in Qatar’s fintech ecosystem in the years to come.
Featured image credit: His Excellence Qatar Central Bank Governor Sheikh Bandar bin Mohammed bin Saoud Al-Thani. Edited from Unsplash
