The Middle East is on the verge of a new era in fintech – is your startup ready?

Yasser Hassan, Senior Director of Small, Medium and Corporate Business, Middle East and Africa

If you run a small fintech business with big ambitions, the Middle East may well be the place to operate right now. New innovations are giving rise to rapid transformation in the sector. And while the UAE has long been a strong contender in fintech, we’re also starting to see other countries like Saudi Arabia forging a path in the industry. ?

It’s perhaps not surprising given the general willingness of people across the region to try new financial solutions. According to a Deloitte study, 82 percent of Middle Eastern banking customers are ready to start using fintech to address their banking needs and at least 22 percent have already adopted one of these solutions.

While the outlook is promising, there are key challenges to overcome. Attracting the necessary financing to drive impact at scale is an ongoing battle, and so too is keeping pace with evolving customer expectations.

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Attracting customers – it’s all about convenience

Deloitte’s research shows that where Middle Eastern consumers are reluctant to adopt fintech solutions, it tends to be because they are looking for a better experience more suited to their needs. In fact, the report underscores the point that the demand for fintech is driven by the growing need for ease and convenience.

And for smaller fintech companies with limited resources staying one step ahead of the customer can be a formidable task.

But this drive to keep innovating has been made simpler by new tools and technologies, which are ushering in an era of groundbreaking financial services that place the customer first. Microsoft Azure is one such platform that enables businesses of all sizes to transform customer experiences, while also quickly and efficiently scaling their services according to demand.

In fact, a key benefit of having a technology partner like Microsoft to manage operations and infrastructure is that businesses can focus their attention on their core purpose, which is to develop new features that speak to the needs of their customers and grow their offering accordingly. Suddenly it becomes much simpler to enhance the experience of existing clients, while still bringing new customers on board.

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Addressing security concerns is a key priority

Operating with the right cloud partner also means security and backups are handled, and that the business can trust its data is secure.

This is key because another hurdle to the adoption of fintech solutions in the Middle East is the general concern around privacy of information. Around 40 percent of respondents to the Deloitte study said they were unwilling to start using fintech solutions because they would be concerned about the security of their personal data.

For most fintech companies, which process large volumes of data, addressing this concern is of paramount importance. This was exactly the situation which Addenda, a UAE-based startup in the insurance space found itself.

The startup uses blockchain technology to connect insurance companies in the Middle East to a trust-based network running on local Azure datacentres. This naturally means the company processes a great deal of sensitive data, which must be kept secure.

To date, the company has had success in protecting this information, not only through blockchain’s cryptography and traceability, but also through Azure’s built-in security tools. In need of a solution that would remain up and running at least 90 percent of the time, it began using private Azure DNS zones, which the company is confident no one can access.

Able to trust that its business is secure, Addenda can focus on disrupting the motor insurance industry, where it is changing how insurers transact and has cut down claims reconciliation time from?months?to?days.?

With governments focused on initiatives and regulations to support the fintech industry, startups in the Middle East are well-positioned to shake up the global market. Particularly at a time when consumers, who have been taken out of their comfort zones by the pandemic, are willing to try new things. Critical, however, for the smaller players operating in this space is that they remain bullish about evolving their technology ecosystems. Agility when it comes to customer experience is no longer a right to play but a prerequisite.?