Qatar is being prepped to become a leading fintech hub in the Middle East.
The Qatar Financial Centre (QFC), a business and financial center located in Doha providing legal and business infrastructure for financial services, has been working with major stakeholders in the sector, including Brussels-based European fintech platform B-Hive to further the country’s ambitions.
The partnership with B-Hive, announced in October 2018, aims to facilitate cooperation on several aspects based on the promotion of business opportunities and knowledge sharing. The two entities have committed to working closely to discuss the latest trends in disruptive technologies, legislation and other data, as well as the organization of global activities to promote fintech in both countries.
“We are witnessing a steady uptake of fintech businesses in the Middle East, with the number of fintech startups soaring to 105, from 46 between 2013 and 2015,” Henk Hoogendoorn, managing director of the financial sector office at the QFC said at a panel discussion in November 2018. Hoogendoorn expects that number to grow to 250 by 2020.
“About 80% of fintechs are non-regulated so we can start working on important themes such as cyber security, data analytics, digital access and a cashless FIFA 2022,” he added.
The central bank of Qatar has also launched initiatives of its own to push fintech innovation. In late 2018, the Qatar Central Bank (QCB) and the Qatar Development Bank (QDB) met with Swedish fintech institutions in Stockholm to discuss plans to open the Doha Fintech Hub.
“A major focus during the visit to Stockholm was knowledge sharing in financial technology, which is currently a prioritized area for the QCB,” Swedish ambassador Ewa Polano told Gulf Times. “The QCB has recognized that for fintech startups to succeed in Qatar, a beneficial regulatory environment is needed.”
Another fintech initiative by the QCB is the banking service platform unveiled last year to support and promote fintech.
Speaking at Carnegie Mellon University in Qatar (CMU-Q) Dean lecture series, the central bank governor H E Sheikh Abdulla bin Saoud Al Thani said there were big opportunities in fintech as the banking sector, including Shariah-compliant banking and financial services, moves into the digital era.
The QCB governor, who is also the chairman of the country’s financial markets regulatory authority, said a US-based company was designated to create the platform. It will start with a Sukuk market to finance micro, small and medium-sized businesses, which will also support and promote entrepreneurship.
Fintech holds considerable opportunities for economic diversification, one of the four pillars of the Qatar National Vision 2030, a plan launched in 2008 to serve as a clear roadmap for the country’s future. The Qatar National Vision 2030 seeks to “transform Qatar into an advanced society capable of achieving sustainable development” by 2030.
Qatari banks push for fintech innovation
Qatari banks have been supportive of national fintech initiatives including the Smart Qatar Programme or TASMU, and have also invested heavily in their own digital transformation.
Commercial Bank, for example, offers an online remittance service that enables expatriate workers in Qatar to send money to accounts back home – often in India, Sri Lanka and the Philippines – within 60 seconds. Ahilbank launched Qatar’s first contactless credit card in March 2016.
But one particular industry participant that’s been thriving to take the lead in fintech innovation is QDB.
QDB launched its Qatar Fintech Hub in May 2018 as part of its fintech vision and ambitions. The Qatar Fintech Hub is a global fintech hub with the purpose to support the development of the fintech industry in Qatar. It aims to facilitate collaboration among the participants and stakeholders of the fintech ecosystem, and develop local and global relationships that will advance the bank’s fintech vision.
In April 2018, the Qatar Fintech Hub signed a Memorandum of Understanding (MoU) with Fintech Hub Lt from Lithuania to contribute to the development of the fintech industry in general and collaborate on fintech initiatives.
The Qatar Fintech Hub is headed by Abdulaziz N Al-Khalifa, the chairman of the Qatar National Fintech Task Force and the CEO of QDB.
“In Qatar, we have a young and digitally connected population, a diversifying economy and a proven system of support for startups and entrepreneurs,” Al-Khalifa said.
“We believe that we have the components of a vibrant fintech hub and we can deliver meaningful impact to Qatar and attract talent from across the world. Our ambition is to become a globally recognized hub that connects like-minded hubs, organizations and regulators from across the world and be at the forefront of the future of fintech.”
Another recent fintech initiative by QDB is the Fintech Pitching and Coaching Day which the bank organized in December 2018.
“By inviting leading European fintech venture capital funds to participate in pitching sessions and coach Qatari fintech startups, as well as attracting leading fintech collaboration platforms to enter business relationships with QDB, we significantly contribute to strengthening country fintech focus,” Khalid al-Mana, executive director of the business finance department at QDB, said.
“Through this event, we also aim to position Qatar as magnet for talents in fintech both locally and globally. QDB is committed to offering a significant contribution towards making our financial services sector more robust, more innovative, and more advanced.”
During the event, QDB signed a cooperation agreement with Finastra, one of the largest UK-based fintech collaborative platforms with representations in major hubs across the world.
Qatar’s commitment to become a leading fintech hub comes as the states of the Gulf Cooperation Council (GCC) race to establish themselves as world-class global fintech hubs.
The Dubai International Finance Centre (DIFC) has signed an agreement with Accenture for its Fintech Hive accelerator, the Saudi Arabian Monetary Authority launched the Fintech Saudi initiative in May 2018 to support the fintech ecosystem and promote the Kingdom as a fintech hub, and Bahrain Fintech Bay, a fintech hub launched in February 2018, introduced its Global Islamic and Sustainable Fintech Center in October 2018 which aims to bolster the use of fintech to drive the next phase of growth in Islamic finance. However, a recent Deloitte study ranked Abu Dhabi as top Fintech Hub in the Mena region.
Featured image: Doha Festival City, Doha, Qatar, via Unsplash