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The Spirit of Innovation: Fintech is Booming in UAE

As populations in the MENA (Middle East and North Africa) region grow at increasing rates, developing a financial infrastructure capable of serving those who live in the Middle East and North Africa – from the underbanked to the ultra high net worth individual – is a massive challenge. We speak to HE Younis Haji Al Khoori, Undersecretary of MoF about how the UAE Ministry of Finance’s (MoF) innovation strategy reflects its support to the National Innovation Strategy of the UAE and what this means for the fintech environment in the MENA of the future.

Finovate: What are the main features of the Ministry of Finance’s (MoF) innovation strategy over the next 12 months?

HE Younis Haji Al Khoori: The UAE Ministry of Finance’s (MoF) innovation strategy reflects its support to the National Innovation Strategy of the UAE, which acts as an umbrella for the UAE Government’s efforts in innovation.

Through this strategy, MoF aspires to showcase its innovation projects that are in support of the innovation ecosystem in the UAE. This is currently being achieved through the introduction of high-calibre projects like the Mohammed bin Rashid Innovation Fund, which is aimed at supporting innovators by granting them access to affordable financing solutions.

In addition, MoF’s innovation strategy focuses on fostering a culture of innovation within the Ministry, and offers its employees comprehensive skills-building and training programmes that are specific to innovation, and empowers them to apply related tools and business practices professionally.

Finovate: How do you define innovation?

HE Younis Haji Al Khoori: Innovation is a broad term with numerous applications. From my perspective it relates to businesses improving competitiveness by developing new and creative processes, products and services to meet and overcome the challenges they face.

The UAE Government aspires to become one of the world’s most innovative countries by 2021. For that, the Ministry of Finance has adopted innovation as a methodology integral to the way every one of our divisions operates and to how every service we deliver works. This spirit has also driven the launch of various initiatives, programs and incubators that support the spread of innovation-culture throughout the country and support its future growth.

Finovate: What’s on the agenda to increase innovation within government and finance?

HE Younis Haji Al Khoori: The UAE Ministry of Finance has announced a 2 billion dirham fund, The Mohammed Bin Rashid Innovation Fund. This fund offers affordable financing solutions to innovators at different levels of their development through a government backed guarantee. MoF is collaborating with Emirates Development Bank to operate the fund and partners within the banking sector to provide the required financing to innovators.

Recently, the Ministry has announced the Fund’s very first success story where an applicant achieved a complete disbursement in virtue of his highlighting an interesting aspect of social innovation in his business.

The fund also offers the opportunity for international value to be brought into applicant businesses through the network of high profile SME owners from around the world working as members of the fund Advisory and Decision Committee. The Ministry is also currently working on broadening the scope of our contribution to the innovation ecosystem through a number of initiatives that will be announced soon.

Finovate: How are emerging technologies going to disrupt the financial services sector?

HE Younis Haji Al Khoori: The advent of fintech, especially with regards to Blockchain and Cryptocurrency spells significant change for the financial services sector which will need to evolve to keep up with the rapid changes we are living through. It is speculated that there will be more changes in the industry over the next decade than there have been in the past 100 years, however I believe the core principles which have seen the financial services sector continue to perform through other periods of change will continue to serve us well through periods of significant upheaval. Embracing a culture of innovation, as well as continuing to acquire smart and informed talent will ensure the sector is prepared regardless of the technological advances that occur elsewhere.

Finovate: How do you see the fintech sector developing in the UAE and beyond?

HE Younis Haji Al Khoori: 2017 has seen fintech enter the popular consciousness in a big way, the meteoric rise of Bitcoin and other emergent digital currency, developments in mobile payment technology, and the introduction of Blockchain have ignited the public interest and pushed the sector’s growth. It is easy to say that the fintech revolution is transforming the financial services sector, and will continue to do so by forming a globally connected world.

The UAE can consolidate its position at the leading edge of this new frontier by attracting the most promising enterprises to develop in our cities, continuing to develop cutting edge business infrastructure and providing accessible and generous funding through funds and incubators. We aspire to become a leading light in the accelerating fintech sector.