The United Arab Emirates (UAE) is set on a solid trajectory to become the next global fintech hub. It recorded a 92 per cent jump in fintech funding – while the rest of the world saw a 42 per cent plunge.
With attractive investment opportunities, innovation-friendly regulatory policies, and a flourishing fintech ecosystem, the Middle Eastern nation has great appeal for investors and start-ups alike.
Further reflecting UAE’s increasing role as a fintech landscape, Economy Minister Abdulla bin Touq Al Marri recently announced that the country is witnessing increasing interest from UK fintechs to pursue dual listings in the UAE market.
The news comes amidst the growing partnership between the two nations, dating back to a memorandum of understanding they signed in October 2023, aiming to boost their cooperation in financial services.
The UK and UAE economic ties have positively evolved since the October Memorandum of Understanding (MoU). The two nations have accelerated talks to take active steps toward fostering development across their individual financial landscapes.
Mayor of London, Lord Michael Mainelli, said: “The economic ties between the United Kingdom and the UAE in the field of financial services have been witnessing dynamic growth, particularly in light of the recently signed MoU aimed at fostering cooperation in this vital sector.”
The primary vision behind the partnership is to strengthen bilateral relations and drive economic growth and development across both nations.
Highlighting this, Lord Mainelli stated: “In light of the strong economic partnership between both countries, we are fully prepared to strengthen collaboration in multiple areas during the upcoming phase. These include capital markets, wealth management, innovation, green finance, and SME financing. Such efforts will contribute to creating a more conducive environment and fostering the economic growth of both nations.”
Both UAE Economy Minister Al Marri, and Lord Mainelli, along with other prominent figures got together on 31st January, 2024, for the Investopia event in London, discussing the theme “UAE-British Financial Services: Partnership for the Future.”
The discussions centered around exploring investment opportunities in fintech, digital transformation, capital markets, and more. The focus remained on discovering new opportunities for collaboration and enhancing the partnership between the two nations.
Fintech is central to UAE’s economic growth and development of its digital economy. The sector has the power to drive digital innovation in the economy and help achieve the “We the UAE 2031” vision.
Touq Al Marri stated: “The fintech sector is a key driver for enhancing innovation and economic growth in the country. The UAE has been keen on encouraging investment in this vital sector and developing it according to the best global standards”.
The UAE has established itself as an attractive investment destination for global and regional investors alike. In 2022, the nation recorded its highest-ever foreign direct investment (FD1) inflows, clocking in around USD23billion.
Hundreds of financial services firms have established their operations across the UAE, particularly in Dubai and Abu Dhabi, attracted to their flourishing capital markets. Building on this, Al Marri revealed that several UK fintech firms are exploring dual listing on the Dubai Stock Exchange.
“I’m glad to see that the Gulf is a great opportunity for these,” Al Marri said in an interview. “The MoU is on track, we have a dedicated team to really look at the plumbing aspects, what can we do on aspects of dual listings.”
Thus, the UAE’s role as a fintech hub is expanding, with new fintech firms being drawn to the region seeking more investment opportunities, and a more supportive ecosystem.
Last year, the Middle East raised around $10 billion from listings, with the Gulf Cooperation Council (GCC) states contributing 45 per cent of the total initial public offering (IP0) volumes in Europe, the Middle East, and Africa. The dual listings could further accelerate the amounts and IPO volumes.
The UAE is actively becoming a go-to destination for young fintech players. Given its economic environment and capital markets, the nation is set to stand as the leading global financial center.
Interestingly, several other nations are also showcasing their intent for dual listing in the UAE. For example, the New York Stock Exchange (NYSE) signed a deal with the Abu Dhabi Securities Exchange (ADX) in November, with the same mission. It’s safe to say that things are looking up for the UAE as a fintech hub.