Islamic Financial Technology and Startup Financing (OpenAlex (recherche mondiale))

Summary

• Islamic crowdfunding currently accounts for only 3-5% of total FinTech funding in the Arab Gulf region.p.1
• The global fintech market was valued at approximately $194 billion US dollars in 2023 and is predicted to surpass $340 billion by 2026.p.2
• Global Islamic finance assets under management exceed USD $4 trillion, offering a significant opportunity for Shariah-compliant fintech.p.2
• Total venture capital invested in Saudi Arabia reached SAR 548 million in 2021, led by telecommunications and IT at 31% and FinTech at 19.4%.p.5
• The Arab world hosts approximately 442 FinTech startups, with the UAE representing approximately 79% of all regional startups.p.6
• Notable regional funding rounds include USD 30 million raised by Tamam and USD 18 million by Aqeed.p.7
• Crowdfunding accounted for 5% of total FinTech financing in the MENA region in 2017, but dropped to 3% in 2018.p.9

Key insights

1. Islamic crowdfunding accounts for only 3-5% of overall FinTech funding available across Arab Gulf countries due to structural and regulatory challenges.p.1
2. The global crowdfunding market represents an annual worldwide volume of approximately 17$ billion.p.2
3. Venture capital funding in Saudi Arabia reached SAR 548 million in 2021, with information technology and FinTech receiving more than half of total investment.p.5
4. The UAE hosts ~349 FinTech startups, commanding approximately 79% of all FinTech startups in the Arab region.p.6
5. Saudi Arabia hosts 105 FinTech startups, which represent 46% of its national startup ecosystem.p.6
6. Conventional debt-based crowdfunding generated ~USD 25B globally in 2016 but remains non-compliant with Islamic Shariah law due to interest payments.p.8
7. Crowdfunding's share of MENA FinTech financing declined from 5% in 2017 to 3% in 2018.p.9
8. Unification of regulatory frameworks is identified as the most severe institutional challenge, scoring 9 / 10 on impact severity.p.11