Israel UAE | Business Guide | 2021

The writer is Chairman of The Fintech Community of Israel - City TLV D uring the COVID- 19 pandemic, the Fintech industry was under stress. However, new and exciting opportunities are being created for the industry in Israel and elsewhere. Fintech can be not only a beneficiary of any future economic recovery, but also an important contributor and accelerator towards such recovery. First and foremost, we clearly observe that if, before the pandemic, Fintech has provided an opportunity for financial and other business entities to transform the relationship with their customers, it has now become an absolute necessity. Social distancing , one of the trademarks of the pandemic, has brought about growth in the use of digital financial services and e-commerce. In particular, the impracticality of handling cash when trying to prevent the spread of infection. Countries have raised limits on the size of contactless payments. The global boom in all E’s - E-Commerce, E-Insurance, E-Learning, E-Training, etc., has put payment Fintechs under pressure to expand their capacity and services. Lending Fintechs are being flooded with requests for relief fromboth customerswho have lost their income, and retailers and other SMEs who were forced to keep their businesses shut. A fast-growing segment in the credit space is Peer-to-Peer (P 2 P) lending that enables individuals to obtain loans directly from other individuals, cutting out the financial institution as the middleman. Regulation. COVID- 19 has moved financial technology to a much high priority level amongfinancial regulators. A new study by the World Economic Forumand theUniversity of Cambridge shows that“COVID- 19 hasmovedFintech up the regulatory agenda, withfinancial regulators respondingwith both sector- wide and Fintech-specific measures to harness opportunities and mitigate risks introduced by technology-enabled financial innovation.” Another interesting indicator is the search inGoogle for Fintech during the lockdown period. According to a report, "therewas a peak of searches in regards to financial guidance. People are looking for tax and mortgage benefits for example. There has been a 300 % increase in searches in the sector in all.” Investments and Valuations Fintech companies are raising funds in record numbers. Venture Capital money is flowing to Fintech firms, adding to skyrocketing valuations. Some of the big names have either announced their IPO or are about to do so. These include Affirm, Revolt, Coinbase, Harmoney, UpStart, Marqeta, Robinhood and others. The latest addition is Israel’s Payoneer, set to go Public in a $ 3 . 3 billionmerger with the Blank-Check Company. Another notable trend isM&As and collaborations - forming alliances, or partneringwith promising start-ups through joint ventures or, more likely, through minority investing. Israel has had new alliances between leading retailers and providers of financial services. A longer-term trend is the expected massive 5 G adoption, which promises to shift the consumer paradigm dramatically. These changes will affect Fintech services most - software, targetingand customer acquisition, credit- scoring procedures, to name just a few. COVID-19 - A New Horizon for Fintech Innovations from Israel can contribute to UAE’s Fintech Ecosystem | Shmuel Ben-Tovim Israel-UAE > Business Guide > 2021 34 > High-Tech > The Israeli Fintech Industry