Financial technology, commonly known as fintech has become the buzzword of the decade in the financial services industry. Dubai International Financial Centre (DIFC) has been playing a leading role in the global fintech arena. Through the Fintech initiatives of the government of Dubai, DIFC became a founding member of the Global Blockchain Council. It has been looking for ways of applying blockchain technology in the financial services sector. Towards this end, last year, the centre partnered with a leading cryptocurrency software provider namely Digitus. The partnership helped DIFC to develop the first digital English common law wills that can be set up online quite easily. They are also very secure and legally recognized in many jurisdictions.
Historically, the DIFC has been recognized as a premium community for both financial and professional service providers. The most notable of these service providers include bankers, insurers, lawyers and asset managers. It is currently developing its existing ecosystem of fintech companies.
Notably, the regulatory framework put in place by Dubai Financial Services Authority (DFSA) has played a key role in the advancement of the fintech ecosystem in the Middle East, Africa, and South Asia region.
Eureeca.com is the first equity crowdfunding platform to be licensed by DFSA to operate a representative office in DIFC. According to Sam Quawasmi, the CEO and co-founder of Eureeca.com, the country’s innovative ecosystem has been going from strength to strength.
Earlier this year, DIFC announced the launch of an accelerator known as the fintech hive in order to promote further growth of the fintech sector. The fintech accelerator is the first of its kind in MEASA region and is expected to link cutting edge financial services technology to the people. Significantly, the region’s population stands at about 3 billion people with a GDP of $7.4 trillion, creating a huge market base. The fintech hive will serve as a platform where financial services and technology companies convene along a collaboratively innovative supply chain to mentor, guide and customize technology solutions for local markets.
Currently, the fintech hive is accepting applications from technology companies that are desirous of accessing the MEASA market. Thereafter, the accelerator will take the entrants through a series of mentorship co-working sessions for twelve weeks. The climax will be marked by a “demo day” on which startups will display their work in addition to engaging tech firms as potential investors and customers.
The fintech hive at DIFC is very attractive to entrepreneurs. According to Laurent Lemaire, the CEO of a DIFC based insurtech firm, Elseco Limited, significant investments are being made in the fintech sector with 1,076 fintech deals totaling to 24.7 billion being sealed in the last quarter of 2016. He notes that DIFC and Dubai at large has the potential to play a pivotal role in encouraging a build out of a DIFC-based ecosystem of fintech companies by enabling and clarifying the regulatory framework and facilitating the availability of capital. Lemaire says that while steps have been made in the right direction, more needs to be done to ensure that the legal environment remains attractive to investors and protects their intellectual property rights.