Fintechs, banks unite for innovation at DIFC event

DUBAI / WAM

Dubai International Financial Centre (DIFC) hosted the second Dubai FinTech Summit (DFS) Dialogues, powered by the Innovation Hub, where heads of 10 leading regional banks and fintechs discussed the challenges facing the financial sector and deliberated on how the industry can de-risk and build resilient, sustainable financial institutions.
Mohammad AlBlooshi, Head of DIFC Innovation Hub and FinTech Hive, hosted the roundtable and noted, “As an industry predicated on confidence and trust, we are currently seeing the banking sector experience a time of disruption. Given global headwinds, we have an opportunity to build more resilient institutions through collaboration between banks and fintechs.”
He added, “Through conveners such as this roundtable and the first-ever Dubai FinTech Summit in May, we are facilitating dialogue and avenues of collaboration for long-standing financial institutions, regulators, and promising entrepreneurs to together map out how the sector can – and should – move forward.”
Recent research by Report Ocean indicates that the global FinTech Lending Market was valued at approximately $573.05 bn in 2021 and is anticipated to grow with a healthy growth rate of more than 27.4% over the forecast period 2022-2029.
Despite being recognised as a major competitor to banks, the fintech sector is expected to double in size from $135.9 bn in 2021 to US$266.9 bn in 2027, according to DIFC FinTech Hive’s 2022 FinTech Report. Additionally, FinTechs have been playing a crucial role in promoting inclusive economic growth in the region, especially as approximately 50 per cent of the Mena region is currently unbanked or underbanked.
However, a unanimous takeaway from all banks at the DFS Dialogue was that both entities are in fact symbiotic.
Sanjay Sethi, Senior Managing Director and Head of Global Transaction Banking at First Abu Dhabi Bank, highlighted the importance of collaboration between financial institutions and FinTechs, stating that it is an age of collaboration and co-creation. He added that through collaboration, entities can embark on a journey of innovative discovery to expand into new geographies, improve product capabilities, grow revenues, or scale or optimize their business faster and more efficiently. He stated that FinTech solutions in transaction banking are growing in agility every day, and FAB will continue collaborating with pioneering FinTechs to deliver impactful advances across the financial industry.
The UAE Central Bank recently announced the implementation of its Digital Dirham digital currency strategy, which promises to be a critical step in the country’s payments industry. This development will deeply impact banks, FinTechs, businesses, and customers. “As such, the synergy between banks and FinTechs proves to be unavoidable as the industry inches towards a cashless economy,” added AlBlooshi.
Raman Thiagarajan, CEO and Founder of Zenda, a FinTech services provider, emphasised that building an emotional connection with the end consumer is key, just as it is with any tech player.
As customers turn to technology, banks have been forced to adapt traditional trust-building to complement the digitisation of banking. Anand Krishnan, Head of Technology at Emirates Investment Bank, emphasised the importance of banks continuing to invest in technology that builds and maintains trust with customers across their entire journey.