Top FinTech Trends To Watch In The UAE

Posted on 22 August 2023

The United Arab Emirates (UAE) has emerged as a worldwide fintech trailblazer, with its market displaying tremendous growth potential, scale, and innovation.

According to the "UAE Fintech Market - (2023 - 2028)" market research study, the UAE fintech industry is expected to develop at a compound annual growth rate (CAGR) of more than 10%.

The UAE's Fintech business is positioned for future expansion as a result of many significant growth factors. These are some examples:

Blockchain technology advancements

End-user-specific personalised solutions

Fintech firms provide modern payment mechanisms.

In this article, we will look at the major fintech advancements that will have an impact on the UAE's financial sector in the future years.

Key Statistics on UAE's Fintech Trends

​• The UAE fintech market is expected to develop at a rate of more than 10% per year.

The market for embedded finance in the UAE is expected to increase at a rate of 30.1% each year until 2029.

The virtual card industry is predicted to be worth $60.06 billion by 2030, with a compound annual growth rate of 20.7%.

Contactless payment on public transport is desired by 75% of UAE poll respondents.

The entire market size of DeFi is increasing at a 19.03% annual CAGR and is expected to reach $205.45 million by 2027.

Rise of Virtual Cards

Virtual debit and credit cards have a CVV number, cardholder name, card number, and validity date, so they may be used like conventional cards. The only distinction is that mobile phone apps can use virtual cards.

UAE customers choose virtual cards over conventional cards due of their convenience and security. The UAE Future of Urban Mobility Survey indicated that 75% of respondents highly expect contactless payment alternatives on public transit.

These digital payment systems allow online transactions without cards, improving security and minimising fraud. Virtual cards are gaining popularity fast. These cards are expected to reach $60.06 billion by 2030 with a 20.7% compound annual growth rate.

Increased POS Financing Demand

In the UAE, point-of-sale (POS) finance, a type of short-term loan delivered at the time of purchase, is gaining popularity. This unique financing solution enables businesses to provide their clients with various payment alternatives, improving sales and customer happiness.

With the advent of e-commerce and changing customer preferences for quick and inexpensive financing solutions, demand for POS financing is expected to increase significantly in the upcoming years.

Global Crypto Hub in Making

Dubai has positioned itself as a global leader in cryptocurrencies and blockchain technologies. The government's initiatives, such as the implementation of the Dubai Blockchain Strategy, have laid a solid foundation for the expansion of the crypto ecosystem.

Dubai has attracted several crypto businesses and investments due to its proactive regulatory environment and supportive framework, supporting innovation and accelerating the usage of digital assets.

Adoption of DeFi and Blockchain

Decentralised Finance (DeFi) and blockchain technologies will be critical in determining the UAE's financial future. Decentralised lending, borrowing, and investing platforms eliminate middlemen and provide consumers with greater financial inclusion.

The entire market size of DeFi is increasing at a 19.03% annual CAGR, and is expected to reach $205.45 million by 2027. Blockchain technology, with its transparency, security, and efficiency, is being used in a variety of areas, including trade finance, supply chain management, and identity verification, to improve operational efficiency and open up new business prospects.

The Way Forward

The UAE's fintech industry is set to develop dramatically in 2023, fueled by fundamental trends that match the country's strategic objective. The UAE has become a robust fintech industry because of the government's dedication to supporting innovation and its supportive regulatory environment.

Furthermore, the expansion of the UAE's fintech industry encourages foreign investment, supports the growth of Micro, Small, and Medium Enterprises (MSMEs), encourages entrepreneurship, and offers job possibilities for people.

Individuals with proven knowledge in finance should expect interesting advancements and possibilities in the coming years as the UAE accelerates its fintech journey.

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