In recent years, the Middle East region has emerged as a hub of technological innovation, spearheaded by Gulf Cooperation Council countries including the United Arab Emirates, Saudi Arabia and Qatar. This technological revolution has brought about significant changes and opportunities in the financial landscape particularly, empowering segments that previously lacked access to services offered by traditional banking institutions—a segment representing millions of individuals in the region.
From mobile banking apps to digital wallets and digital lending platforms, technologies allowed new players in the fintech sector to serve previously untapped demographics. A prime example can be seen in the UAE, where approximately 2.2 million blue-collar workers make up 52 percent of the workforce. Many of these workers have limited or no access to traditional banking services, underscoring fintech’s crucial role in addressing financial inclusion challenges.
The democratization of finance not only promotes financial inclusion but also empowers individuals to effectively manage their finances, provide support and improve access to education and healthcare to their families and elevate their standard of living through increased remittances to their home countries. The impact of gaining access to these essential financial services extends far beyond local boundaries, significantly benefiting individuals and their families, particularly those residing in remote regions with a higher reliance on remitted funds. Data from the Central Bank of UAE (CBUAE) indicates that countries such as India, Pakistan, and the Philippines contributed to over 50 percent of the total Dh145.7 billion in outward remittances from the UAE in 2022.
By offering digital financial services to this demographic, companies are actively contributing to improving the population’s digital literacy and supporting the region’s digital transformation agenda. Additionally, these services protect individuals from predatory and illegal sources while providing the convenience of managing financial activities from their smartphones. This convenience is bolstered by the fact that the smartphone penetration rate in the region is the highest in the GCC sub-region, with countries like the United Arab Emirates (UAE) surpassing 96 percent in 2023, as reported by Statisa.
In conclusion, the digital revolution in the Middle East has not only reshaped the financial landscape but also paved the way for greater financial inclusion, empowerment, and stability. Through innovative fintech solutions, millions of individuals, including blue-collar workers, have gained access to essential financial services, enabling them to manage their finances more effectively and improve their overall quality of life. As businesses continue to drive digital literacy and support the region’s digital transformation agenda, we can anticipate further advancements that will benefit individuals and families, ultimately contributing to a more inclusive and prosperous society in the Middle East.
