Abu Dhabi Global Market (ADGM) has signed an agreement with start-up accelerator Flat6Labs to encourage the growth of financial technology (fintech) in the emirate.
The initial agreement signed between the pair follows on from ADGM’s recent plan to create a Regulatory Laboratory (RegLab) aimed at helping fintech firms to operate in a controlled environment, but one that it still cost-effective and not too stifling for smaller businesses.
The RegLab is the first of its kind in the Middle East.
Richard Teng, the chief executive of ADGM’s Financial Services Regulatory Authority, said it welcomed Flat6Labs “as one of our strategic partners in establishing a fintech ecosystem in the UAE”.
“As an Abu Dhabi-based establishment, Flat6Labs is well recognised as a successful, committed and experienced technology accelerator in the region.
“More importantly, Flat6Labs shares our desire in fostering a vibrant entrepreneurial environment to support the growth of fintech in the region.”
Victor Kiriakos, the managing director of Flat6Labs Abu Dhabi, said: “Part of our mission is to accelerate entrepreneurship in the Mena region and to successfully execute this, we require a collaborative mindset. We are very glad to have found in ADGM a partner that values collaboration.”
ADGM is a financial centre based at Al Maryah Island in Abu Dhabi. Its regulatory authority published a consultation paper on its RegLab this month and is seeking industry views on how it should operate. The consultation period ends on June 13.
A study published in November last year by consultants Strategy& stated that global investment in the fintech sector had more than doubled since 2008, reaching US$3 billion last year. It predicted this is set to double again by 2018, and may even hit $8bn.
Strategy& argued that although the GCC did not currently have a vibrant fintech ecosystem, it had the necessary ingredients required to build one, including a conducive business environment, regulatory support, access to capital and the necessary financial experts.
Strategy& principal Abdulkader Lamaa said there were “already some success stories in the GCC, particularly in the UAE where incubators and innovation hubs are supporting the creation and growth of local digital enterprises”.
Daniel Diemers, a partner in the firm, added: “If the region can rise to this challenge, the rewards for the financial industry and the broader regional economy could be significant”.
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