Abu Dhabi Global Market (ADGM), the International Financial Centre in Abu Dhabi, and the Bahrain Economic Development Board (EDB) have entered into a Fintech cooperation agreement, marking a significant first in the MENA region.
Signed between two of the leading MENA Fintech hubs, the agreement represents a leap forward in promoting the region as a connected and collaborative environment for Fintech to thrive in. It provides a framework for information sharing, and for facilitating the movement of start-ups, knowledge, and talent between the two jurisdictions. With the new partnership, Bahrain EDB and ADGM will explore initiatives to promote economic growth in financial services through the adoption of new technology, and highlight MENA’s strengths in the FinTech sector.
“We are excited to witness the first FinTech MoU between two MENA jurisdictions,” said Richard Teng, Chief Executive Office, Financial Services Regulatory Authority of ADGM. “Together, we advocate and see the MENA region as a continuous whole and look to leverage each other’s strengths to anchor a vibrant Fintech ecosystem. From our close discussions with the Economic Development Board of Bahrain, and especially at the first Regional Regulators’ FinTech Roundtable recently in Abu Dhabi, it is clear we value the importance of collaboration and mutual support in any relevant manner. I look forward to continuing to work closely with our partner in building a more connected, collaborative network among our fellow regulators in the MENA region to cater to the rapid pace of FinTech growth here.”
The agreement will allow for a closer collaboration on the exchange of information on trends, services and products, leading to a closer relationship in the development of Islamic finance and Fintech initiatives across the region. Professional and academic knowledge transfer, accelerator programs and the mutual promotion of the development of relevant technologies such as digital payments and blockchain are fundamental to the growth of these sectors. Fintech startups will have the ability to access information from each respective jurisdiction through one common point of contact.
“We have seen exciting momentum in FinTech in Bahrain and across the region over the last year,” said David Parker, Executive Director - Financial Services at Bahrain EDB. “The FinTech sector has witnessed approximately US $50 billion in investment globally, but the MENA region has received only about 1% of that. In Bahrain, we recognise that there is great potential for growth in this sector and we are capitalising on this by creating the right ecosystem. This MoU marks another inspiring moment in our regional development. In Bahrain, an ongoing series of legal and regulatory reforms are supporting easy access to a wide range of new opportunities, including a Fintech sandbox and support for both conventional and Shari’a-compliant crowdfunding. We look forward to this agreement leading to the rapid development of even more initiatives across the region.”
As an IFC and FinTech hub, ADGM has reached significant milestones and established strategic partnerships to bolster the regional Fintech ecosystem, supporting the safe development of Fintech both in the region and globally. The EDB partnership further enhances ADGM’s Fintech collaboration hubs that currently stretch across Asia, Australia, Europe and North America.
This agreement comes as the region looks to establish itself as a centre of FinTech excellence, and follows a number of recent supportive measures in Bahrain. Underpinned by the establishment of a new Amazon Web Services (AWS) Region based in Bahrain, key activities include the establishment of a new regulatory sandbox, the launch of a national e-wallet and the development of the MENA region’s largest FinTech hub, which is set to open in the first quarter 2018.