Middle-East and Africa Banking-As-A-Service Market - Growth, Trends, COVID-19 Impact and Forecasts(2022-2027)

The banking As-A-Service market is segmented by type (API-based BaaS, Cloud based BaaS), by Service type (payment Process Services, Digital Banking Services, KYC Service, Customer Support Services, Others), by Enterprise Size (SMEs, Large Enterprises), and by Region (South Africa, GCC, Egypt, Rest of Middle-East and Africa).

Market Snapshot

Middle East and Africa Banking-As-A-Service Market Size
Study Period: 2018-2027
Base Year: 2021
CAGR: >8 %
Middle East and Africa Banking-As-A-Service Market Key players

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Market Overview

Banking As-A-Services (BaaS) Market is an end-to-end model that enables digital banks and other third parties to connect directly with bank systems via APIs, allowing them to build banking offerings on top of the providers' regulated infrastructure while also unlocking the open banking opportunity, reshaping the global financial services landscape. A number of nations have already begun to implement open banking legislation, signalling that the financial services sector is headed toward an era in which shared data and infrastructure will become the new expectations of customers.

The COVID-19 epidemic has affected every industry. Organizations are transitioning towards digitization to ensure overall safety of employees and staffs as a result of social distancing rules imposed to restrict the spread of the virus. The epidemic is anticipated to prompt a broad and systematic redesign of high-impact digital journeys in the banking industry, such as customer onboarding and product generation, in order to provide clients with a genuinely exceptional digital experience.

The Middle East and Africa region is home to around 460 million people. Approximately half the population is under the age of 26. With such a big and young population, the Middle East and Africa Banking-as-a-Service (BaaS) Market is enticing and growing for early technology adopters. 470 Middle Eastern FinTech enterprises are expected to raise approximately USD 2.1 billion in venture capital investment by 2022, compared to 30 FinTechs that raised nearly USD 78 million in 2017.

The more active FinTech segments have received the majority of the cash invested in the region. Payments and exchange companies, as well as the insurance industry, online borrowings, RegTech, online banking, fundraising, blockchain, and cryptocurrency firms, are all gaining popularity in the region. However, the payments industry continues to get the majority of funding: over 80% of FinTech enterprises in the Middle East area are involved in payments, transfers, and remittances.

Scope of the Report

The baking As-A-Service market is segmented by type (API-based BaaS, Cloud based BaaS), by Service type (payment Process Services, Digital Banking Services, KYC Service, Customer Support Services, Others), by Enterprise Size (SMEs, Large Enterprises), and by Region (South Africa, GCC, Egypt, Rest of Middle-East and Africa) .

By Type
API-based BaaS
Cloud based baaS
By Service Type
Payment Process Services
Digital Banking Services
KYC Services
Customer Support Services
Others
By Enterprises Size
Large Enterprises
Small & Medium Enterprises
By Region
South Africa
GCC
Egypt
Rest of Middle-East and Africa

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Key Market Trends

Growing use of Digitalization in Middle-east and Africa will drive the market

With the growing use of digital banking services across several sectors, demand for BaaS platforms has increased among medium and small-sized businesses. The incorporation of artificial intelligence, blockchain technology, and API services into online banking will also increase demand. The increased need for effective consulting and digital roadmap strategy in the BaaS category is also expected to drive market growth in the future years. Furthermore, the technology implementation and integration segment is expected to capture the biggest market share throughout the projection period due to the increased usage of integration techniques in the BaaS sector to provide an interactive environment for virtual banking.

Middle East and Africa Banking-As-A-Service Market Trends

Growing Number of Fintech Startups in Middle-East and Africa

Start-ups operating in the Middle East and Africa raised more than US$1.2 billion in investment in the first half of 2021, indicating a year-on-year increase of 64%. 1 A look at the countries receiving the most funding in the region reveals why the region is experiencing a venture capital boom, with 71 percent invested in the UAE (primarily through the various financial center free zones, such as the Dubai International Finance Centre and the ADGM), Saudi Arabia, and Egypt. With the globe presently undergoing the fastest energy transition in human history, these countries have responded decisively, acutely aware of the repercussions of this change on their primary revenue-generating assets and, ultimately, on their long-term riches. Both nations have significant economic diversification and sustainability targets to meet by 2030, as well as larger modernizing aims.

Governments in the Middle East and Africa are also increasingly offering regulatory assistance to start-ups. For example, all of the Gulf States have or are considering regulatory sandboxes for Fintech, which provide a safe environment for innovators to test Fintech solutions while being overseen by regulators.

Middle East and Africa Banking-As-A-Service Market Analysis

Competitive Landscape

The market is currently consolidated but is expected to be fragmented in the future. To prevent churn, industry leaders are concentrating on acquiring fintech start-ups to establish their own net-banking and digital banking offerings. In addition, the players are developing unique ways to satisfy their clients.

The rapidly changing demand for enhanced banking products and digitization from diverse organisations is prompting key companies to rely on third parties and build new API services.

Recent Development

  • March 2022- Aazzur has formed a sales cooperation with Treezor, the European leader in Banking-as-a-Service (BaaS), to help both firms increase their client base and develop their BaaS offering in MEA. Treezor will supply its payment infrastructure for account and card management, while AAZZUR will provide front-end layers, integration, and value-added products to give front-end, as well as wealth and sustainability value-added services.
  • March 2021 - The Dubai-based firm, which has emerged as a key GCC banking option for the country's vast population of low-income migrant workers, employs mobile banking technology to provide accounts, low-cost remittance, and a variety of other financial services to the migrant worker community. NOW Money raises USD 7 million in funding for Gulf digital expansion. The cash obtained will be used by NOW Money to join the Saudi market, with plans already in place to create an office in Riyadh with additional workers. The firm will also expand its product and service offerings while maintaining its growth plan in the UAE.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

    3. 4.3 Market Restraints

    4. 4.4 Insights on Key Forces Shaping the Market

    5. 4.5 Insights on Consumer Trends and Preferences in BaaS Market

    6. 4.6 Porter's Five Forces Analysis

      1. 4.6.1 Threat of New Entrants

      2. 4.6.2 Bargaining Power of Buyers/Consumers

      3. 4.6.3 Bargaining Power of Suppliers

      4. 4.6.4 Threat of Substitute Products

      5. 4.6.5 Intensity of Competitive Rivalry

    7. 4.7 Insights on Government Regulations in the Market

    8. 4.8 Impact of COVID-19 on the Market

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Type

      1. 5.1.1 API-based BaaS

      2. 5.1.2 Cloud based baaS

    2. 5.2 By Service Type

      1. 5.2.1 Payment Process Services

      2. 5.2.2 Digital Banking Services

      3. 5.2.3 KYC Services

      4. 5.2.4 Customer Support Services

      5. 5.2.5 Others

    3. 5.3 By Enterprises Size

      1. 5.3.1 Large Enterprises

      2. 5.3.2 Small & Medium Enterprises

    4. 5.4 By Region

      1. 5.4.1 South Africa

      2. 5.4.2 GCC

      3. 5.4.3 Egypt

      4. 5.4.4 Rest of Middle-East and Africa

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Market Competition Overview

    2. 6.2 Company Profiles

      1. 6.2.1 Sarwa Co

      2. 6.2.2 Beehive

      3. 6.2.3 Solaris Bank

      4. 6.2.4 NOW Money

      5. 6.2.5 Treezor

      6. 6.2.6 Telr

      7. 6.2.7 Mamo Pay

      8. 6.2.8 Felix

      9. 6.2.9 Jingle Pay

      10. 6.2.10 Al Baraka Bank

    3. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  8. 8. DISCLAIMER AND ABOUT US

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Frequently Asked Questions

The Middle-East and Africa Banking-As-A-Service Market market is studied from 2018 - 2027.

The Middle-East and Africa Banking-As-A-Service Market is growing at a CAGR of >8% over the next 5 years.

Sarwa Co, Beehive, Solaris Bank, Now Money, Treezor are the major companies operating in Middle-East and Africa Banking-As-A-Service Market.

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