Dubai Takes A Clear Lead In Mena Region's Financial Inclusion

The financial technology startups are working wonders in Dubai and the United Arab Emirates (UAE) in ensuring financial inclusion and the closure of gender gap in economic participation. This became evident when the UAE topped the chart of the recently released MENA Financial Inclusion Report 2020 by the Fintech Consortium comprising Bahrain Fintech Bay and Jordan Fintech Bay.

Financial inclusion is typically defined as the proportion of individuals and firms that use financial services and in the context of a world economy that is now better integrated, it is of considerable interest among policy makers, researchers and other stakeholders. Financial inclusion is also an indicator of the critical role in reducing extreme poverty, boosting shared prosperity and supporting inclusive and sustainable development.

The MENA Financial Inclusion Report 2020 had delved deep into the key initiatives in the region and found UAE to be a leading player in financial inclusion. The report that provides recommendations and critical advice to overcome the challenges that hamper financial inclusion says the overall financial inclusion rate stood at 20% in the MENA region during 2016 with men playing a dominant role at 19% compared to women at 9%.

A breakdown of key categories in the report confirms that 36% of the region’s population has access to financial services while 24% has access to payment functions. However, only 9% has access to credit and 12% to savings. UAE, however, has the highest financial inclusion rate at 46%, the report says followed by Bahrain (39%) and Saudi Arabia (31%). The UAE’s financial inclusion rate is even higher for the population age of 15 with 87% having access to financial account, the report notes.

The finding is not surprising considering the fact the UAE Government has been playing an active role in supporting the growth of local fintech ecosystem with key initiatives that include the launch of sandbox in two offshore sites as well rules on crypto-assets and alternative lending among other things. FinTech Hive at Dubai International Financial Centre (DIFC) in particular has come out with various measures to promote fintech startups in its efforts to ensure financial inclusion and gender parity.

“Financial inclusion and gender parity is important for economic development. And, FinTech Hive will ensure this through the continuous innovation of financial services and bettering the already robust ecosystem for financial innovation to grow,” says Ms.Raja Al Mazrouei executive vice president FinTech Hive at DIFC.

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