Dubai’s Leading Role in Driving Global Fintech Innovation

Dubai’s influential position in fostering innovation within the financial services sector is reaffirmed by the recently published report, a joint endeavor between Dubai International Financial Centre (DIFC) and Refinitiv, a London Stock Exchange Group business.

Over the coming five years, we can expect digital assets, decentralized finance, open finance, and ESG-linked finance to stand out as crucial trends that will fuel innovation. FinTech investments are expected to increase at a compound annual growth rate of 17.2% from 2022 until 2030, reaching 949 billion dollars, as indicated by a report released on Wednesday.

On Wednesday, the DIFC and Refinitiv jointly released a report titled “Drivers of Innovation in Financial Services.” This report offers a comprehensive outlook for innovation in the financial services industry over the next five years.

The worldwide financial services sector is undergoing significant changes following the first surge of innovation prompted by the pandemic. According to the report, these transformations are aligned with the evolving expectations and preferences of customers as well as clients. The growing demand for personalized and convenient services has not only intensified competition but also brought about continuous disruptions, with new entrants like FinTech as well as Big Tech companies establishing their presence in an ever-expanding market.

The adoption of automation technologies like blockchain, artificial intelligence, and also cloud computing is enabling significant business models as well as product innovations. As a result, operating costs are being reduced and inefficient processes are being streamlined, leading to increased efficiency and productivity within the industry.

The report highlights four crucial trends that will significantly influence the industry in the coming five years, tapping into the possibilities of open finance, fostering increased decentralization within finance, the rise of digital assets as a legitimate asset category, and the integration of ESG principles into various aspects of banking operations.

Furthermore, the report emphasizes the significance of fostering innovation within long-standing financial institutions, enabling agile progress and enhancing future competitiveness. This can be achieved through approaches like Venture Studios.

Dubai and the DIFC serve as a strategic worldwide center for FinTech as well as Innovation enterprises within the region. They posses a robust innovation ecosystem that equips both FinTech companies and financial institutions with the essential resources, including accelerator programs, progressive regulations, and venture development platforms, as well as opportunities for venture capital and alternative startup funding, and globally renowned talent development initiatives, all of which foster financial innovation.

Arif Amiri, DIFC Authority’s CEO, remarked, “The FinTech sector is poised for substantial growth, projected to achieve a 17.2% Compound Annual Growth Rate and reach 949 billion dollars from 2022 to 2030. This surge is driving accelerated FinTech innovation both globally and here in Dubai. Coupled with our access to rapidly expanding emerging markets, along with DIFC’s outstanding regulatory, financial, and innovation ecosystem, it creates significant chances for growth and innovation. Within DIFC, we are witnessing a proactive collaboration between traditional Financial Institutions and disruptive startups as we jointly work towards shaping the financial landscape, in line with our visionary 2030 strategy and with an eye towards the future.”

Nadim Najjar, the Managing Director of CEEMA at the London Stock Exchange Group, emphasized the increasing significance of innovation within the financial sector. He pointed out that the industry is undergoing rapid disruption, compelling all stakeholders to explore novel approaches to conducting business. Over recent years, FinTech has played a pivotal role in driving financial innovation by introducing an expanding array of cutting-edge technologies capable of fostering fresh business models, processes, applications, and products. 

The report’s validation took place during a roundtable event organized by DIFC, the Dubai International Financial Centre, and graced by distinguished figures within the industry. Among these influential figures were individuals holding pivotal roles within their organizations, such as the leader overseeing Emerging Technology at Amazon, the Vice President responsible for Innovation & Design at Visa CEMEA, the Director of Innovation at E& Enterprise, and the Senior Vice President at First Abu Dhabi Bank. Moreover, the roundtable witnessed amazing contributions from other speakers, including the Managing Partner at U+ Digital Ventures, a Partner at Stryber, a Director at FutureLabs, and the Head of Projects Portfolio at the Commercial Bank of Dubai. The DIFC Launchpad was represented by specialists well-versed in Corporate Innovation and Innovation Strategy, while an adept moderator with expertise in Sustainable Finance in Emerging Markets from Refinitiv artfully facilitated the session.