A survey conducted by Várri Consultancy, a Dubai-based consultancy focused on strategy and risk assessment, found that as the UAE fintech industry continues to grow, there are greater risks and uncertainties that lies ahead compared to a year ago.
The “UAE Fintech survey 2021” had polled the opinions of over a hundred leading companies within the fintech sector to assess the levels of risks.
The primary risk drivers include supply chain disruptions, liquidity risk, IT and cyber risk.
Underscoring specific threats, more than half of the respondents said their company had been the subject of a cyber-attack in the last year, which in most instances resulted in financial liability and direct revenue loss.
Neither country risk nor inflation was perceived as having any material impact, reflecting the level of trust fintech companies place in the UAE’s financial and legal infrastructure.
Meanwhile, Covid-19 remains one of the main risks to their companies achieving their strategic objectives in 2021 even though it has been a year into the pandemic.
Additionally, almost half of the respondents also believe that liquidity risk and operational risk will increase in the coming year, compared to a quarter who believe those risks will reduce.
The UAE is leading the fintech market in the Middle East and North Africa region, which is estimated to top US$ 2.5 billion by 2022.
Commenting on the UAE focused survey outcomes, Johnny Kollin, Founder and Managing Director, Várri Consultancy said,
“Companies are responding to the current uncertainty by reassessing their business models and strategies.
The survey reveals an opportunity for UAE fintech companies to take the lead in developing innovative solutions and, with the help from relevant subject matter experts, improving and spearheading risk management in the sector,”
The survey further concluded that 77% of the respondents envisage making material changes to their companies’ business models in the next 12 months to better guard against uncertainty and increasing competition, coupled with updated regulations.