KPMG’s recently published Pulse of Fintech H2’21 bi-annual report has revealed that investment in fintech companies in Europe, Middle East and Africa (EMEA) touched $77.4bn across 1,859 deals. Total global fintech funding across M&A (mergers and acquisitions), PE (private equity) and VC (venture capital) reached $210bn across a record 5,684 deals in 2021, according to the bi-annual report.
The report highlighted that the fintech ecosystem in the Middle East also continued to evolve, with a $75m raise by Bahrain-based Rain and a $50m raise by UAE-based Tabby in the second half of 2021. In the UAE, fintech VC, PE, and M&A activity saw significant growth in 2021, with the UAE continuing to foster an environment that encourages and celebrates innovation in fintech.
Goncalo Traquina, head of Management Consulting, KPMG Lower Gulf, said: “The UAE government has moved forward with a number of initiatives to foster the growth of fintech. Cryptocurrencies and blockchain are expected to retain their appeal to investors in 2022, as increasing numbers of crypto firms seek regulatory guidance to grow and develop the sector. While much of fintech investment in the UAE has been focused in the digital banking and payments space, lending is projected to grow on the back of AI and machine learning being deployed to improve credit risk assessments.”
The Innovation Hub in DIFC allocated about $100m to help startups grow through its ‘Fintech Fund Accelerator Program’. In October 2021, the Central Bank of the UAE signed an agreement with Dubai International Financial Centre at Expo Dubai to enhance collaboration under their co-sandbox programme for fintechs. These, combined with startup funds, are likely to be a big part of developing the UAE’s fintech ecosystem over time.
According to the report’s findings, payments continued to attract the most funding among fintech sub-sectors, accounting for $51.7bn in investment globally in 2021 – up from 29.1bn in 2020. A…
