Market Trends of Middle East And Africa Challenger Banks Industry
Large Unbanked Population in the region
Having a bank account and being able to withdraw or transfer money at any time is one of the things that people in developed countries take for granted, like clean water, electricity, or, to a lesser extent, internet access. In many regions of the world, however, access to basic financial services is anything but given, with 1.7 billion people still “unbanked.” Thanks to the rise of digital payment options and challenger bank-friendly regulatory environment in the region. The number of unbanked populations in the region, as a whole, has been reduced over the years.
Regulatory Reforms Will Drive the Market
Before the COVID-19 pandemic, digital transformation was a priority for the majority of Middle Eastern countries, with government and regulatory bodies not only supporting digital banking initiatives but actively advocating for them. The Middle East has a favorable regulatory landscape for the development of digital financial services, as evidenced by the fact that many countries in the region have incorporated fintech innovations into their vision statements. As a result, regulators are striving to accelerate the issuance of financial institution licenses and make the regulatory environment more accommodating to both new and existing participants. The Saudi Central Bank's open banking policy is one example of an initiative that seeks to accelerate the implementation of open banking.
