Will the Middle East's fintech boom last? Yes - but only with fewer bets

Vijay Valecha, March 16, Fast Company Middle East

Today, every company wants to be a fintech company. And it’s easy to see why. In 2025, fintech funding jumped 80 percent year-on-year to $1.14 billion, making up 26 percent of total MENA VC deals, up from 20 percent in 2024. Tabby’s $160 million and Hala’s $157 million rounds were among the biggest last year.

No doubt, it is one of the hottest sectors in the region, to the point where venture capitalists joke that founders can draw a check just by mentioning “financial services” in their pitch deck.

Venture capitalists have bankrolled every possible fintech fad: from peer-to-peer lending to buy-now-pay-later. This is partly why fintech has been the most-funded segment of the startup ecosystem over the last few years.

Growth Drivers

“The fintech sector in the MENA region has witnessed significant growth over the past few years, with the number of fintech companies now exceeding 1,000, including four unicorns,” says Vijay Valecha, CIO, Century Financial.

Saudi Arabia’s National Fintech Strategy 2030 is advancing the country’s goal of becoming a fintech hub. At the same time, Dubai’s DIFC Innovation Hub and Abu Dhabi’s ADGM are speeding up open banking frameworks that link fintech platforms with traditional banks.

“The expat populations from these countries contribute to large remittance flows to their home countries, auguring well for low-cost fintech providers of cross-border cash transfers. Moreover, the rise of multiple BNPL platforms is gaining traction, making it easier for users to access credit for discretionary spending,” says Valecha

But will fintech still be as lucrative a bet in 2026? Will the boom continue?

A 2025 Emirates NBD & PwC report forecast that the fintech market in the UAE would grow to $5.71 billion by 2029.

Valecha says the fintech boom in MENA is expected to be the fastest globally. He adds that revenue from the sector is expected to grow 35 percent annually through 2028, more than double the global average of 15 percent. “One of the main reasons for this is the low share of fintech in the overall banking sector. The GCC’s fintech share of banking-sector revenues represented only 1 to 2 percent, compared with 3 to 5 percent in the US and UK. This is expected to catch up, adding tailwinds for the sector.”

He says GCC capital markets are offering strong support for fintech firms, from local family offices expanding to global venture funds. “Investor confidence is further raised by clear exit options via bank acquisitions or the ongoing public listing trend.”

Source

Fast Company Middle East