Qatar Central Bank (QCB) Governor H E Sheikh Abdulla bin Saoud Al Thani has said Qatar is committed to invest in the fast emerging financial technology sector and has developed a strategy to create a ‘fintech hub’ in the country.
Delivering Carnegie Mellon University in Qatar (CMU-Q) Dean lecture series yesterday, the central bank Governor said, Fintech can help achieve QCB’s goals set up in the financial sector strategy. There is momentum building in Qatar, with opportunity in the areas of digital payments, money management, lending, loyalty and rewards, remittances, and investments and advisory, he said.
“For all of these fintech opportunities, we have to measure the impact financially and strategically, as well as how it relates to the customer, to assess whether we should pursue each opportunity,” he said.
Sheikh Abdulla noted that huge investments in fintech are going to revolutionize the existing banking model. Global investment in fintech has increased by 66 percent between 2010 and 2015. The major investments in the sector will force the banking sector to alter its existing business models.
Mena banks need to be aware of the emerging power of tech companies and be ready to collaborate or change their models as the regulatory regime changes. Or they will certainly not be able to compete with the changing times.
“Fintech industry believes in disruptions and will continue to disrupt the financial services.. .Tech giants are fast entering in the domains of financial services…Many banks will be forced to close down their branches.. banks are facing these threat from tech giants in the region as well as across the globe..”
In terms of investments in the sector, Middle East region is a disappointing case. The region’s contribution to the global investment is less than 0.1 percent. Banks and insurance companies in the region have been slow in innovation. “For Mideast we need to go a long way to create a proper ecosystem to move away from the disappointing performance”, he said.
But it is encouraging that some success stories are coming from the region. “Some of the firms from the region have emerged as potential players in the industry,” the central bank governor said.
Michael Trick, dean of CMU-Q, commented that “Sheikh Abdulla raised an important concept of teamwork as Qatar and the world embrace fintech as a way of doing business. Computer scientists, finance experts, and industry and government leaders all have a role to play, and it is inspiring to our students to imagine how they can contribute.”
An ideal fintech ecosystem features available talent, well informed investors, and a regulatory environment that is both open and stable. In order to create such an environment in Qatar, Al Thani stated that banks and regulators have to collaborate with fintech firms to provide the best possible customer service.
The Peninsula Qatar