Recently, Innovate Finance, a British fintech authority, released the "2023 Fintech Investment Landscape Report", which shows that the top 10 Asian countries in the global fintech investment in 2023 surpassed the top 10 European countries for the first time. The U.S. remains the world's number one leader, followed by the U.K. in second place and India in third place. Moreover, the 5 largest deals of 2023 took place in the United States, the United Kingdom, India, and the United Arab Emirates.
Top 10 global markets for fintech: Asia's first to surpass Europe
In terms of size and volume, in 2023, global fintech investment reached $51.2 billion, involving 3,973 transactions, with an average deal size remaining at $12.9 million. Compared to 2022, both the total and the number of fintech investments have decreased.
图片来源:Innovate Finance官网
Notably, for the first time, the top 10 Asian countries in the world for fintech investment in 2023 surpassed the top 10 European countries.
The report shows that in 2023, global fintech witnessed a wide international distribution of capital, highlighting the dynamic and extensive nature of global fintech development, with the United States being the leading fintech market, followed by the United Kingdom, India, and other players. In 2023, Hong Kong made it into the top 10 for the first time, with 41 deals with an investment of US$913 million and an average deal size of US$22 million. The top 10 countries are:
- United States: 1,530 transactions worth $24.2 billion
- United Kingdom: 409 transactions worth $5.1 billion
- India: 187 transactions worth $2.5 billion
- Singapore: 176 transactions worth $2.2 billion
- China: 76 transactions worth $1.8 billion
- United Arab Emirates: 54 transactions worth $1.3 billion
- France: 97 transactions worth $1.2 billion
- Germany: 86 transactions, $1.1 million
- Hong Kong: 41 transactions, $912 million
- Canada: 92 transactions worth $884 million
It was also the first time that the United Arab Emirates had entered the top 10, with 54 deals and $1.3 billion invested. Investments in the UAE have grown exponentially compared to 2022.
Tim Levene, CEO of Augmentum, said: "Part of this growth is a 'catch-up' phenomenon, as claims such as digital banks are entering these markets for the first time, but there are also 'leapfrogging' situations. For example, the adoption of digital wallets in the Asia-Pacific region is far ahead of Europe in terms of payments and identity. ”
图片来源:Innovate Finance官网
A new global force swimming against the current: Fintech in the UAE
According to the report, at a time when the global fintech investment wave is experiencing a widespread cooling in 2023, the UAE has risen to the sixth place in the global fintech center rankings with its unique charm and steady pace, demonstrating extraordinary economic resilience and innovation vitality.
Bucking the trend: a safe haven for global fintech investment
While global fintech investment as a whole saw a sharp decline of 48% in 2023, from US$99 billion in 2022 to US$51.2 billion, the UAE has shown a very different upward curve, with a staggering 92% growth in fintech sector investment. This achievement has enabled the UAE to climb rapidly on the global fintech map, jumping from 24th place in 2022 to the top 10, and firmly sitting in the sixth place in the global fintech center rankings.
Policy support: Build a world-leading fintech ecosystem
The UAE government's strong focus and support for fintech is a key factor in driving the rapid development of the industry. The Dubai International Financial Centre (DIFC) promulgated the world's first Digital Asset Law, which clarifies the legal status and operational norms, paving the way for global fintech companies to innovate and expand in this field. At the same time, DIFC has also introduced a new Securities Law, drawing on international best practices to create an internationally aligned and competitive regulatory environment for fintech companies. The government has not only provided strong support to fintech companies through legislative reform, regulatory innovation and the establishment of special funds, but also enhanced the international visibility and influence of fintech in the UAE by hosting various large-scale fintech events, such as the Dubai Fintech Summit. At the same time, the UAE's young population, high technological literacy, and strong demand for digital services provide a solid market foundation for fintech start-ups.
International Collaboration: Bringing together global fintech giants and start-ups
In 2021, the international giant Amazon set up the world's first fintech lab in Dubai, working closely with local SMEs, financial institutions and innovative enterprises to explore and solve challenges in the field of payments. This move will undoubtedly further enhance the UAE's global connectivity and innovation capabilities in the fintech sector. In addition, the UAE is actively working with international regulators, payment technology giants such as Visa and Mastercard, and payment processors to promote the prosperity and development of the region's fintech ecosystem.
Diversified tracks: nurturing industry leaders and emerging forces
The boom in the UAE's fintech sector is not accidental, but rather a comprehensive development that encompasses multiple segments. From digital banks to cryptocurrency exchanges, from insurtechs to wealth management tech, from blockchain applications to digital wallets, the UAE's fintech ecosystem is rich and vibrant. Among them, emerging business models such as virtual banking and buy now, pay later (BNPL) are enthusiastically sought after by consumers and have become an important driving force for the growth of the industry. At the same time, the UAE has also shown a positive and enterprising attitude in cutting-edge areas such as open banking and regtech, providing a broad experimental field for fintech start-ups to innovate.
Regional linkage: radiating the Middle East and influencing the world
The rise of fintech in the UAE has not only driven the transformation and upgrading of the country's economy, but also has a profound impact on the surrounding region. Neighboring countries such as Saudi Arabia and Qatar have also shown strong growth momentum in the fintech sector, forming regional synergies. In addition, the successful experience and model of fintech in the UAE are attracting fintech start-ups from the Middle East and around the world to take root, forming a fintech innovation network that radiates to the Middle East and connects the world.
The rise of the fintech industry in the UAE is the result of its forward-looking policies, innovation ecosystem, international cooperation, diversified tracks, strong market foundation, active investment atmosphere and regional influence. Against the backdrop of increasing uncertainty in the world economy, the UAE has successfully built a vibrant, inclusive, open and innovation-driven global fintech center with its unique fintech development strategy, which has not only injected new momentum into the national economy, but also set a new benchmark for the development of the global fintech industry.
As the largest city and economic hub in the UAE, home to more than 100 international and regional fintech companies and 100 blockchain companies, Dubai has become a significant player in the new economy and the new fintech capital of the world. In order to go deep into Dubai, explore the latest development trends and applications in the field of financial technology and digital finance, understand the financial innovation trends in the Middle East, and explore the possibility of innovation layout and cooperation. From May 5 to 10, 2024, the "Middle East Fintech Expedition" jointly organized by Zhongguancun Internet Finance Research Institute and Zhongguancun Fintech Industry Development Alliance will depart. Visit Dubai, explore the latest development trends and applications in the field of fintech and digital finance, understand the financial innovation trends in the Middle East, and discuss the possibility of innovation layout and cooperation. (Registration contact: Mr. Cao's 13718969634, same number on WeChat)
(This article was first published on the Titanium Media APP, author | Yan Fanyao, editor - Liu Yangxue)
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