The Inaugural 24 Fintech Summit: Shaping the Future of Finance in Saudi Arabia
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The inaugural 24 Fintech Summit is set to be a landmark event in Saudi Arabia, uniting top government officials and global finance leaders to tackle pressing issues that are shaping the future of the financial services industry. With a focus on governance, risk and policy, cybersecurity, global interoperability, and innovations in payment systems, this summit promises to be a pivotal platform for dialogue and collaboration.
As Saudi Arabia’s fintech sector rapidly evolves, now accounting for nearly 20% of all venture investments in the kingdom, the summit will highlight key trends, challenges, and opportunities in this dynamic landscape.
1. Digital-First Future
The shift towards a digital-first approach is revolutionizing financial services worldwide. In 2023, digital payments in the Middle East and North Africa (MENA) region surged by 19%, with projections indicating the market could reach $200 billion by 2026. This trend emphasizes the critical role of digital technology in enhancing financial inclusion and accessibility, making it a focal point of discussions at the summit.
2. Direct Access to Payment Systems
Cross-border payment systems present significant challenges, with global remittance costs averaging 6.3% in Q1 2024. The summit will delve into the barriers that hinder efficient payments and explore how fintech companies can work to reduce these costs. Notably, the MENA region is expected to see cross-border payments grow by 12% annually, reaching $55 billion by 2025. Saudi Arabia ranks third globally in remittance outflows, with SAR 144 billion (approximately $38.4 billion) sent abroad in 2023 alone.
3. Balancing Innovation and Regulation
As the fintech market is projected to grow at a compound annual growth rate (CAGR) of 25% from 2023 to 2028, reaching $310 billion, the role of central banks in regulating fintech becomes increasingly vital. Discussions at the summit will focus on how regulatory frameworks can foster innovation while ensuring financial stability, particularly in emerging markets like Saudi Arabia.
4. Saudi Arabia’s AI Strategy in Finance
Saudi Arabia is making substantial investments in artificial intelligence (AI), aiming to become a global leader in this field by 2030. The kingdom’s AI market is expected to grow by 35% annually, contributing $135 billion to the economy by 2030. Various speakers at the summit will explore how this AI strategy is transforming the financial sector, particularly in risk management and customer service automation.
5. The Evolution of Payment Landscapes
The global Buy Now, Pay Later (BNPL) market is projected to reach $1.2 trillion by 2027, with a CAGR of 28%. In the MENA region, the BNPL market was valued at $9 billion in 2022 and is expected to grow to $146.19 billion by 2032, with a CAGR of 32.20% from 2023 to 2032. This growth presents significant opportunities in a region where card usage is underutilized, and e-commerce adoption is rapidly increasing.
6. Resilience in Fintech Regulation
Fintech startups must navigate complex regulatory environments to attract investment. In 2023, global fintech investment reached $75 billion, with the MENA region accounting for $3 billion. The summit will focus on strategies for startups to thrive in this challenging landscape, particularly in Saudi Arabia, where fintech investment is expected to grow by 15% annually.
7. Capital Markets and Venture Capital
The digital transformation of capital markets is accelerating, with the global digital assets market projected to reach $23 billion by 2025. Saudi Arabia’s Vision 2030 has spurred a surge in venture capital, with fintech emerging as a major beneficiary. In 2023, venture capital funding in Saudi Arabia’s fintech sector grew by 60%, reaching $500 million, with fintech leading investor transactions in the first half of 2024.
8. Cybersecurity
As the fintech industry faces increasing cyber threats, global cybersecurity spending is expected to reach $45 billion by 2026. The summit will address strategies for mitigating risks such as ransomware and blockchain exploits, particularly as the MENA region experiences a 25% increase in cyberattacks targeting financial institutions. This innovation bridges the gap between conventional banking and the digital finance world, offering a more efficient way to manage and transfer assets.
Meanwhile, central bank digital currencies (CBDCs) and stablecoins are also key developments in the fintech space. Over 130 countries are experimenting with CBDCs to modernize payments and enhance financial inclusion. Stablecoins, designed to reduce cryptocurrency volatility by anchoring their value to stable assets, play a critical role in the emerging digital ecosystem.
These trends underscore the dynamic nature of the fintech industry and the importance of staying ahead in a rapidly evolving financial landscape. The 24 Fintech Summit, scheduled for September 3-5, 2024, promises to be an essential gathering for industry leaders, investors, and innovators shaping the future of finance.
For more details, visit the official agenda and read about the event in Gulf Business.