Bahrain slow to embrace Fintech, says report

Manama : Bahrain and the GCC are yet to capitalise on the benefits of Fintech (financial technologies), revealed a report. According to the findings of a new research by Marmore MENA Intelligence, despite the kickstart of several digital transformation drives by the governments, the Gulf region is yet to make a mark in Fintech. 

Fintech refers to the use of technology, usually in the form of software applications or digital platforms, to deliver financial services to consumers. Globally, Fintech has marked a steady growth over the years. 

“Fintech is now the focus of financial service organisations across the world due to its disruptive nature. It creates and provides new efficient business services to consumers,” Marmore explained.  

However, MR Raghu, Managing Director of Marmore Mena Intelligence, said there had been signs of improvements in the region. “Fintech has begun to bubble up across the region, in payment systems (CashU), peer-to-peer lending (Beehive), crowdfunding (Eureeca, Aflamnah and Durise), online/mobile banking and online trading.” he wrote in The National. 

“Crowdfunding is one area where Fintech has begun to show its potential in the region. Although it may not replace the traditional sources of funding, such as banks, private equity and venture capital, crowdfunding has provided another option for a region that is facing a severe liquidity crunch,” he pointed out.

“Besides, crowdfunding, at times, focuses on motives beyond financial return. For instance, Qatar’s Silatech has joined hands with Qatar Charity to launch a crowdfunding platform dedicated to funding young Arab entrepreneurs,” Raghu noted.

In his view, the biggest potential impact of Fintech would be the increase in reach of Islamic financial services, as an alternative to conventional finance. 

“Fintech eating into IFI margins will force the latter to provide more services online and standardise offerings to customers,” he added.