The Impact of COVID-19 on Fintech in Jordan and Worldwide

As the world begins to adjust to the “new normal” in light of the COVID-19 pandemic and as businesses and industries deal with the impact, Fintech is emerging as a sector teetering on the edge—facing both challenges and opportunities from the current situation that will affect the future of the industry.

Amidst the widespread lockdowns and social distancing measures, the fintech sector has been experiencing growth in the use of digital financial services and e-commerce. Jordan, for example, has seen a significant shift away from traditional cash transactions, which have been historically favored in the country, and towards increased acceptance and reliance on e-payment channels and fintech solutions.

However, the fintech sector faces some challenges in predominantly cash-reliant countries like Jordan, such as how to ensure citizens’ continued and even increased use of digital financial services and e-commerce after COVID-19. Another one is how to provide feasible and accessible solutions to underprivileged or rural populations with limited access to technology.

One possible solution, at least to the former challenge, lies in the opportunity for the fintech sector to embrace its advantageous position as a provider of the most practical and hygienic methods for completing financial transactions that meet social distancing requirements. The current circumstances give the fintech industry a golden opportunity to build up a solid reputation with regard to convenience, reliability and security, to expand its user base and potentially emerge from the crisis stronger than before.

Given the possibility of industry growth, there are significant benefits as fintech has the capability to extend financial inclusion, improve peoples’ day-to-day transactions, and stimulate regional economic growth and development.

Global fintech trends, however, have shown marked instability in the wake of the pandemic as there have been reductions in funding, the establishment of new fintech firms, and the revenue streams of existing organizations. Though well-established and more financially prepared organizations have been able to adapt more quickly to the changing circumstances and respond to growing consumer needs.

While the future of the fintech industry may not be set in stone, one thing is certain—the world after COVID-19 will not be the same as before. Given the increased focus on health and hygiene, it is likely that fintech solutions will continue to experience growth and expansion as consumers around the world embrace the convenience and reliability of digital financial services.