{"id":10552,"date":"2025-03-27T09:50:17","date_gmt":"2025-03-27T09:50:17","guid":{"rendered":"https:\/\/mena-fintech.org\/demo\/?post_type=news&p=10552"},"modified":"2025-03-27T09:51:20","modified_gmt":"2025-03-27T09:51:20","slug":"fintech-on-the-rise-in-qatar-driven-by-increased-adoption-of-digital-payments-and-strong-government-initiatives","status":"publish","type":"news","link":"https:\/\/mena-fintech.org\/demo\/news\/fintech-on-the-rise-in-qatar-driven-by-increased-adoption-of-digital-payments-and-strong-government-initiatives\/","title":{"rendered":"Fintech on the Rise in Qatar Driven by Increased Adoption of Digital Payments and Strong Government Initiatives"},"content":{"rendered":"

Though fintech remains a relatively nascent sector in Qatar, the industry is growing at a rapid pace.<\/span><\/p>\n

A new report by Switzerland Global Enterprise (S-GE), the official Swiss organization for export and investment promotion in the country, explores the key drivers of this growth and the emerging trends shaping the sector.<\/span><\/p>\n

The\u00a0<\/span>report<\/span><\/a>\u00a0highlights the remarkable growth of the Qatari fintech industry. It emphasizes the dominance of digital payments in this ecosystem, fueled by Qatar\u2019s high internet penetration rates and widespread smartphone usage. Notably, 99% of the 2.7 million overall population in Qatar is using Internet, contributing to a robust environment for the adoption of digital payments<\/span><\/p>\n

Furthermore, Qatar boast a well-developed IT infrastructure, including 5G and fiber-optic technology, and is one of the countries with the fastest mobile Internet connections in the Middle East, providing startups a favorable environment to innovate and thrive.<\/span><\/p>\n

In an interview with The Peninsula in November 2024, Visa\u2019s Vice President and General Manager Kuwait and Qatar Shashank Singh,\u00a0<\/span>highlighted<\/span><\/a>\u00a0the impressive growth of Visa\u2019s contactless payment system in Qatar.<\/span><\/p>\n

Since the launch of its digital payment solution in the country a few years ago, transaction volumes have increased five-fold, and the number of individual transactions has grown six-fold, now covering over 5,000 merchant locations, including Karwa Taxis, DHL, and Hi Wash, he said. Today, 96% of all in-store digital payments in the country are made using contactless technology, indicating a strong shift towards the payment method.<\/span><\/p>\n

The rise of embedded finance<\/b><\/h5>\n

In addition to digital payments, embedded finance is rapidly gaining traction in Qatar\u2019s fintech landscape, fueled by the advent of open banking.<\/span><\/p>\n

Adoption of open banking initially stemmed from the private sector, with the largest bank in the country, the Qatar National Bank (QNB),\u00a0<\/span>announcing<\/span><\/a> in 2022 the launch of its open banking platform and becoming the first bank in the country to offer such services. The platform allows for secure integration between QNB\u2019s core financial systems and third parties like fintech startups and corporate partners, facilitating data sharing and payment processing.
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In May 2024, QNB took it a step further by\u00a0<\/span>launching<\/span><\/a>\u00a0the country\u2019s first open APIs services specifically tailored for its corporate clients.<\/span><\/p>\n

While the private sector pioneered open banking in Qatar, the Qatar Central Bank (QCB) has also embraced the trend, introducing its fintech strategy in 2023 with a particular focus on open banking initiatives. The central bank\u00a0<\/span>is now said<\/span><\/a>\u00a0to be preparing an open banking framework scheduled for release by 2026, marking a significant step towards open finance.<\/span><\/p>\n

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Evolution of open finance in key Gulf Cooperation Council (GCC) countries, Source: Embedded Fintech in GCC, Roland Berger, Jan 2024<\/span><\/p>\n

The embedded finance market in the Middle East and North Africa (MENA)\u00a0<\/span>was worth<\/span><\/a>\u00a0US$10 billion in 2024, a valuation that\u2019s projected to grow by 45% to 2030.<\/span><\/p>\n

Digital assets and blockchain technology<\/b><\/h5>\n

Another emerging fintech vertical highlighted in the S-GE report is digital assets and blockchain technology. Blockchain, in particular, is perceived as a powerful tool for businesses in Qatar, offering efficient, secure, and affordable transaction systems.<\/span><\/p>\n

Tasmu Digital Valley, an initiative in Qatar aimed at fostering digital innovation and technology development,\u00a0<\/span>expects<\/span><\/a>\u00a0Qatar\u2019s blockchain market to reach US$253.4 million by 2026, up from US$33.2 million in 2022.<\/span><\/p>\n

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Qatar blockchain market usage (US$ million), Source: BuddeComm; Deloitte Analysis, via Tasmu Digital Valley<\/span><\/p>\n

In addition, QCB is actively pursuing digital currency opportunities. In June 2024, it\u00a0<\/span>completed<\/span><\/a>\u00a0the development of the infrastructure for its central bank digital currency (CBDC) project. This initiative aims to enhance access to capital markets for operating banks in the country, enhance domestic settlement, and improve the efficiency of securities transactions.<\/span><\/p>\n

National strategies\u00a0and government initiatives<\/b><\/p>\n

The report emphasizes the significant role of government initiatives in accelerating fintech growth in Qatar, particularly through initiatives like the Qatar Fintech Hub (QFTH). Founded by Qatar Development Bank (QDB), a government-backed financial institution, QFTH is an innovation and entrepreneurship center aimed at supporting the growth of the Qatari fintech ecosystem.<\/span><\/p>\n

To date, over 50 fintech startups\u00a0<\/span>have graduated<\/span><\/a>\u00a0from programs run by QFTH, with a combined portfolio valued at US$500 million. The hub is set to allocate US$16 million in pre-seed investments from 2020 to 2028, with the aim of supporting another 50 fintech startups over the next five years, according to S-GE.<\/span><\/p>\n

The report also highlights Qatar\u2019s strategic push towards a fully digital environment. The Third Financial Sector Strategic Plan, introduced in November 2023,\u00a0<\/span>aims<\/span><\/a>\u00a0to create a financial and capital market that leads the region in innovation, efficiency and investor protection.<\/span><\/p>\n

The strategy is founded four pillars, namely banking, insurance, digital finance ecosystem and capital markets, alongside five cross-cutting themes to ensure successful implementation and delivery: governance and regulatory oversight; Islamic finance; digital innovation and advanced technologies; environmental, social and governance (ESG) standards; and talent and capabilities.<\/span><\/p>\n

The plan has set ambitious targets for the financial sector, including increasing the number of licensed fintech and insurtech players to 35, up from\u00a0<\/span>10 in September 2023<\/span><\/a>, achieving an annual growth rate of 4.7% in the financial sector until 2030; and increasing private sector credit by 15%, bringing the percentage of commercial credit to private companies up to 77%.<\/span><\/p>\n

Another key national plan is the Qatar Fintech Strategy 2023.\u00a0<\/span>Launched<\/span><\/a>\u00a0in March 2023, this strategy aims to support the diversification and innovation in the financial sector and invest in a knowledge-based economy.<\/span><\/p>\n

It\u2019s based on four main axes:<\/span><\/p>\n