The MENA region is in the middle of a digital transformation, which 2020 and COVID-19 has only accelerated. I asked five experts to share the tech trends they see influencing the Middle East and North Africa (MENA) this year, with digital payments, greater investment in AI and mobile, coupled with the need for greater focus on cybersecurity, all getting a mention.
Among the things to look out for on the Middle East tech scene in 2021 is the Expo 2020 event, which is due to take place in Dubai in the UAE for six months starting from October says Matthew Reed, practice leader, Middle East and Africa & Asia Pacific, at Omdia.
"The event, which was postponed last year due to the COVID-19 pandemic but will still be known as Expo 2020, is expected to showcase advanced technologies and applications including autonomous vehicles, smart city services, and space exploration, with the latter based on the UAE's launch of an unmanned spacecraft to Mars in July 2020.
"Saudi Arabia also has futuristic plans and in early January it unveiled the outlines of a major new city project, The Line, a 170-kilometre urban development that will be entirely powered by renewable energy and will be "hyper-connected though a digital framework incorporating artificial intelligence and robotics, according to the launch website.
"The Saudi authorities are also increasingly keen to encourage investment and growth in the country's non-oil business sector, and that is likely to accelerate efforts to upgrade connectivity and technology services for enterprises over the year ahead."
The fintech landscape in MENA is rapidly evolving from a focus on digital payments to expanding access to finance, both consumer and SME lending, says Ayman Ismail, Jameel chair of entrepreneurship, The American University in Cairo.
"The past three years were mostly about establishing infrastructure for digital payments. We saw numerous startups offering digital payments services through mobile wallets, credit and debit cards, acceptance methods for merchants both online and at retailers.
Banks also expanded their online presence, acceptance offerings, and started building digital bank subsidiaries. Governments promoted digital payments for their services, payroll and social support. They also introduced numerous regulations to support the sector enabling data protections, electronic know-your-client (eKYC) and interoperability.
"In Egypt, the number of mobile wallets has exceeded 15 million, with double-digit month-over-month growth, and the number of point-of-sale (POS) machines more than doubled over the past year, allowing more merchants to accept digital payments. COVID-19 acted as a catalyst, accelerating the adoption of digital payments among consumers, businesses and governments alike.
"Having established this payment infrastructure, the next big trend in the region is in lending, both consumer lending and SME lending.
"Numerous startups are introducing solutions for consumer lending, ranging from payday loans, app-enabled nano-loans, to buy-now-pay-later retail solutions. Business lending is also expanding with existing micro-finance companies going digital and new startups introducing supply chain financing in partnership with manufacturers.
"Startups are also introducing enabling technologies such as credit scoring, AI-enabled Arabic language chat bots, and digital onboarding solutions. Markets are visibly thirsty for more credit that is easier to access and technology-enabled.
"Banks, private equity funds, and large investors are looking for these new digital channels to deploy capital and are searching for investments or acquisitions of successful players in this space, even at early-stage. Regulators are responding by updating many of the regulations for non-banking financial services and launching new licensing opportunities.
"This space is going to grow substantially in 2021. Digital payments and lending are at the core of this transformation and likely to grow exponentially over the next three years."