October 2023

October 2023

Pursuit of Excellence Vipul Kapur Managing Director & Head of Mashreq Private Banking

October 2023

Pursuit of Excellence Vipul Kapur Head of Mashreq Private Banking

A MEA Finance Publication

12 Trade Finance| 38 Aviation Finance| 44 Oracle KSA Roundtable| 54 Leaders in Payments Conference | 67 Leaders in Payments Awards Winners

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Remittance Remit

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eading nations in the region have determinedly fostered the modernisation of processes and systems to provide swift, agile and secure payments environments, with the aim and effect of strengthening their economies.

This work, still in progress, has revolutionised the ways individuals and businesses transact, bringing flexibility that encourages creative energy, opening new opportunities for many.

This was enthusiastically debated in illuminating detail at the 2023, MEA Finance Leaders in Payments Summit and Awards, held on the 14th of September. The tightly packed event, both in terms of the agenda and attendance, featured key personalities at the evolutionary vanguard of this key sector in the region’s economy.

After the stimulating exchanges between our esteemed speakers and conversationalists and bringing due recognition to all those across banking, fintech and technology who have made our region a leading global centre for payments innovation, followed the MEA Finance Payments Awards. You can read about the event and see the awards winners, all starting from page 54.

If that was not enough, this issue is dense with rich content that we are very pleased includes, featuring as the cover story, our interview with Vipul Kapur, Managing Director and Head of Head of Mashreq Private Banking, who tackles the trends and concerns facing this increasingly prominent part of the region’s financial markets, “Ultimately, the success of integrating the personal approach with technology hinges of client preferences and the capacity to adapt”. Read from page 34.

Then, starting at page 44, you are treated to another of our market recognised MEA Finance roundtable discussions. Recently taking place

in Riyadh, with a creditable assembly of market experts, and backed by Oracle, the event focused on how The Cloud is increasingly at the core of digital innovation in corporate and transaction banking.

Among the features we look into in this issue is the regional Aviation Finance sector, which, while now performing well again is facing challenges that are leading businesses to check newer funding sources, “While banks currently dominate the sector, the entry of non-bank lenders and growing interest in sustainable aviation finance signal a dynamic and competitive market,” says Vijay Valecha, Chief Investment officer at Century Financial.

We take a look at influences on Trade Finance in the region and how it is changing through the adoption of technology and other challenges, “Given that trade finance is an important driver of the regional economy, banks are expected to engage with clients on ESG issues in the process of offering trade finance facilities,” mentions Madhavan Thooppal, Head of Trade Services at NBF. The ongoing efforts to keep ahead of the broadening risk landscape is given an airing in our focus on Risk Management also in this issue. See page 24 to learn more.

In our Opinion Piece, and in keeping with the payments theme, Saad Ansari, Co-founder and CEO at Xpence gives a highly informative insight into Payments Processing in the Middle East, “In fintech, while we frequently discuss legacy technology, it is the legacy mindsets that can be more dangerous.” Then in our Banking Technology coverage, Serkan Arslan, Sales and Business Development Director at Fineksus looks at the effects of digitisation and challenges in the pressurised realm of regulation. And finally, from page 8, our market focus in this issue is on Lebanon, which despite its many woes, it taking steps needed to start a recovery.

So, as you now embark on your journey through this, our October 2023 issue, you will receive instant and handsome payment for your time in the form of truly informative and often quite enjoyable reading.

mea-finance.com

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CONTENTS

CONTENTS 34

MARKET NEWS

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FAB partners with Masdar and Blue Carbon to accelerate MENA carbon trading market

MARKET FOCUS

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Down But Not Out

TRADE FINANCE

12 The Balances of Trade 16 Primed for Purpose ARTIFICIAL INTELLIGENCE - Only as Good as the Data that 20 AIFuels it

PARTNER CONTENT Role and the History of the 22 The International Chamber of Commerce (ICC)

RISK MANAGEMENT

24 Running to Stand Still OPINION PIECE

Choices: The Journey in 30 Card-Centric Payment Processor Selection

COVER STORY

34 Pursuit of Excellence

MEA Finance WEB: www.mea-finance.com EMAIL: info@mea-finance.com PUBLISHED BY: Creative Middle East Media FZ LLE, 19th Floor, Creative Tower, Fujairah Creative City, PO Box 4422, Fujairah, UAE

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Banking and Finance news in the MEA market

AVIATION FINANCE

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38 Patches of Turbulence 42 Cleared for Take Off ORACLE ROUNDTABLE EVENT and Transaction Banking 44 Corporate in the Era of the Cloud

LEADERS IN PAYMENTS

54 A Real Time of Change for Payments

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LEADERS IN PAYMENTS AWARDS 2023 MEA Finance Leaders in 68 The Payments Awards 2023 spotlights the innovations and achievements of the region’s top banking, fintech and financial technology players

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42 EXECUTIVE DIRECTOR AND PUBLISHER Kenneth Mitchen ken.mitchen@mea-finance.com GROUP COMMERCIAL DIRECTOR Nap Estampador nap.estampador@mea-finance.com Tel : +971 50 100 5488 DIRECTOR Andrew Cover andrew.cover@mea-finance.com Tel: +971 50 931 3236

EVENTS AND MARKETING MANAGER Cris Balatbat crissyb@mea-finance.com Tel: +971 58 594 4818

ADMIN AND FINANCE MANAGER Marilyn Nainque marilyn@mea-finance.com Tel: +971 58 5025836

EVENT AND CONTENT DIRECTOR Natasha Cristi natasha@mea-finance.com Tel: +971 50 303 4235

WEB ASSISTANT Marie Orayan web@mea-finance.com

SENIOR DESIGNER Florante Magsakay Tel: +971 52 570 1811 design@mea-finance.com

EDITORIAL editorial@mea-finance.com

Dubai office: #404, Building B, Al Saaha Offices, Old Town Island Burj Khalifa District PO Box 487177, Dubai, UAE Email: info@mea-finance.com

mea-finance.com

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MARKET NEWS

FAB partners with Masdar and Blue Carbon to accelerate MENA carbon trading market Making rapid progress in its work to develop the MENA carbon trading market, First Abu Dhabi Bank (FAB) is signing MoU agreements with Blue Carbon and Masdar for the supply of high-quality carbon credits, another step towards FAB’s journey of becoming the UAE’s carbon trading hub

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A B re centl y l a unched i ts dedicated carbon trading desk, part of its Global Markets of fe r i n g , i n l i n e w i t h t h e bank’s mission to expand its carbon capabilities. Introduced during the UAE Year of Sustainability to support national, regional and global net-zero carbon goals, the FAB Carbon Desk provides carbon trading and financing options, facilitates strategic carbonrelated transactions and promotes the development of high-quality carbon credits and offsets for corporate and investment banking clients.

FAB is the first regional bank to have trading capabilities in both compliance markets, including the EU Allowances (EUA) and UK Allowances (UKA), and voluntary carbon markets such as Gold Standard and Verra. It is also the first regional bank to offer EUA cash and carry notes and offer forward carbon credit

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purchase-structured solutions to local and international clients.

In its first few months, the FAB Carbon Desk executed multiple EUA trades. It was also first to execute a trade on the AirCarbon Exchange (ACX) in Abu Dhabi and is currently engaged in industry discussions with industry majors facing international emissions regulations.

FAB is already in discussion with large national and regional industrials about exposure to changes in the European Union’s Emissions Trading System, and in advanced talks with UAE entities to build a voluntary carbon ecosystem. It is also acting as forward buyer, hedge provider and originator of high-quality carbon credits for its clients. MoUs signed with Blue Carbon and Masdar are important milestones in these discussions, connecting UAE sustainability leaders directly into the emerging MENA carbon trading market.

Banking and Finance news in the MEA market

Sheikh Ahmed Dalmook Al Maktoum, Chairman of Blue Carbon, said: “Climate finance has taken centre stage recently in the fight against climate change, and our partnership is a prime example of how it can be harnessed to create lasting positive impacts. We are dedicated to advancing not only carbon reduction but also economic empowerment and community livelihood support in the countries in which we are engaged.”

Mohamed Jameel Al Ramahi, Masdar’s Chief Executive Officer, said: “Masdar is proud to be partnering with First Abu Dhabi Bank to explore exciting ways to tap into carbon markets to accelerate the energy transition.

Masdar has been active in carbon markets through our own investments and projects for the past 15 years, and we are fully supportive of tools that increase capital allocation to decarbonisation initiatives. Carbon credits provide industries with practical tools for reaching their ambitious decarbonisation targets.

Ahead of the UAE hosting COP28, we will continue to work across all sectors to build a more sustainable future for all.”

The FAB Carbon Desk expands on FAB’s carbon trading capability first offered in 2021. Its remit includes providing tailored carbon solutions within the GCC region and throughout FAB’s global network, and actively sourcing, originating and trading high-quality carbon credits.

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MARKET FOCUS

Down But Not Out Lebanon’s financial system has suffered eyewatering losses over the years and the government estimates overall losses at around $70 billion, but the country is taking the first steps on the long road to recovery

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ebanon’s liquid foreign currency reserves dipped below $10 billion to $8.57 billion, official data from Banque du Liban (BdL) revealed in August, as the central bank pushes for greater transparency following the departure of its long-time governor Riad Salameh.

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Building on this progress, there is now the opportunity for comprehensive reforms to strengthen BdL’s governance, accounting and foreign-currency operations in line with international best practices.

Under Salameh, who has been governor since 1993, the central bank

Banking and Finance news in the MEA market

did not disclose foreign asset and liability numbers. Earlier in August, the interim central bank governor called on the political elite to quickly implement structural reforms requested by the international community as the apex lender is not able to offer loans to the state to plug the budget deficit.

Lebanon is in the grips of the worst financial and economic crisis in modern history, which is being blamed on the “deliberate inaction” of the country’s politicians who failed for a 12th time to elect a new president in June.

In 2022, the World Bank blamed the country’s political elite for a “Ponzi Finance” scheme, saying “the current crisis aggravated long prevailing and serious gaps in the financing of those basic public services.”

Lebanon’s financial system has suffered eyewatering losses over the

years and the government estimates overall losses at around $70 billion. A series of holdups by depositors seeking funds frozen in the banking system is reminiscent of the country’s broader economic crisis.

However, Lebanon is banking on its oil and gas discoveries to reverse a nearly four-year economic and financial crisis, which has sunk the currency by more than 90%, spread poverty, paralysed the financial system and frozen depositors out of their savings.

Friends in high places The World Bank allotted $300 million in additional financing for the most vulnerable families in Lebanon in May, two years after the Washington lender approved a $246 million loan to the Mediterranean nation of six million people.

The funding “will enable the government of Lebanon to continue to respond to the growing needs of poor and vulnerable households suffering under the severe economic and financial crisis,” said Jean-Christophe Carret, the World Bank’s Middle East Country Director.

The country also received $25.9 million from Canada, via the UN World Food Programme, in May to support the National Poverty Targeting Programme, which helps the most vulnerable families.

Lebanon secured $11 billion in aid at the Paris CEDRE Conference in 2018 and the pledges include $10.2 billion in loans and $860 million in grants. However, donors including Saudi Arabia and the European Union have not delivered the billions of dollars that they pledged as the country is yet to embark on critical structural reforms and tackle endemic corruption.

The government in Beirut is trying to convince its international donors that their money will be spent ‘in the right way’. “We expect aid from all of you once we convince you it’ll be spent in the right way,” caretaker Finance Minister Youssef El Khalil told a meeting of government and institutional officials in Dubai earlier this year.

LEBANON WILL NEED STRONG FINANCIAL SUPPORT FROM THE BROADER INTERNATIONAL COMMUNITY AND THE FINANCIAL NEEDS OF LEBANON OVER THE NEXT SEVERAL YEARS ARE VERY LARGE GIVEN THE MAGNITUDE OF THE ECONOMIC CRISIS – Julie Kozack Director of Communications, International Monetary Fund

Several international organisations and donor countries stand ready to help the Mediterranean country, but after the formation of an independent government that will implement the much-need structural reforms.

“Lebanon will need strong financial support from the broader international community and the financial needs of Lebanon over the next several years are very large given the magnitude of the economic crisis,” Julie Kozack, Director of Communications at the International Monetary Fund (IMF) said in June.

THE GOVERNMENT, PARLIAMENT AND THE CENTRAL BANK MUST ACT TOGETHER, RAPIDLY AND DECISIVELY TO TACKLE LONGSTANDING INSTITUTIONAL AND STRUCTURAL WEAKNESSES TO STABILISE THE ECONOMY International Monetary Fund

The IMF said the government, parliament and the central bank must act together, rapidly and decisively to tackle longstanding institutional and structural weaknesses to stabilise the economy. The fund expects these reforms to pave the way for a strong and sustainable recovery.

A historic meltdown Under Salameh, BdL’s regulations helped Lebanon largely dodge the global financial meltdown of 2008.

The former central bank governor is credited for maintaining the country’s currency peg for over two decades before it unravelled in late 2019. His policies got the credit, and the halo effect enabled him to brush off pressure from lawmakers to sell some of the central bank’s more extravagant assets, including a private jet and a casino.

For decades, Lebanese banks operated what amounted to a giant pyramid or Ponzi scheme, whereby depositors were paid exorbitant interest rates on simple deposits. The banks in turn lent heavily to the government which racked up huge debts largely due to corruption and bad governance.

Furthermore, BdL also kept US dollars flowing through the country’s financial sector by offering troubled financial institutions extremely generous interest rates. However, this was a short-term solution as the central bank didn’t have the funds to cover that interest or all the deposits. mea-finance.com

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MARKET FOCUS

BdL introduced financial engineering in 2016 to boost its reserves but an audit by accounting firm Alvarez & Marsal (A&M) found evidence that “illegitimate commissions” of $111 million were paid from a central bank account from 2015 to 2020.

A&M’s report also revealed that the so-called financial engineering conducted by the central bank was “highly costly, with a total cost of $7.7 billion (LBP 115 trillion) between 2015 and 2020.” Lebanese banks’ foreign-currency liabilities totalled about $97 billion as of May 2023.

Though banks’ foreign-currency assets at BdL were approximately $79 billion, Fitch Ratings said these are not available to them because the central bank’s readily available foreign-currency reserves were below $10 billion, excluding gold and its holdings of government Eurobonds.

The World Bank in August accused the political elite of being cruel by asserting that deposits in Lebanon’s collapsed banking sector are sacred, noting that “a significant portion of people’s deposits at commercial banks have been misused and misspent over the past 30 years.”

The country’s financial crisis and shortage of foreign currency forced banks to impose strict restrictions on US dollar withdrawals and suspended most transfers abroad which triggered massive protests that began on 17 October 2019.

The Lebanese Pound has since lost more than 90% of its value, and most depositors are still unable to access their savings. They are allowed small monthly withdrawals, almost always in the form of unreliable pound, no matter the designated currency denomination of their deposits.

Hit by restrictions on withdrawals, angry depositors have forced their way into more than eight banks since August to access trapped savings as the informal capital controls that were imposed by banks are pushing account holders to take the law into their own hands.

Last month, the IMF welcomed the new policies of Lebanon’s central bank but cautioned that the country’s “outlook remains difficult and unstable”.

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“The recent decisions taken by the BdL’s new leadership to phase out the Sayrafa platform, establish a reputable and transparent foreign-currency trading platform, end the drawdown of foreigncurrency reserves, curb monetary financing and enhance financial transparency are steps in the right direction,” said the IMF. The call by BdL for local lenders to recapitalise last year and repatriate part of deposits transferred overseas forced Bank Audi and Blom Bank to sell their Egyptian portfolios to UAE’s First Abu Dhabi Bank and Bahrain’s Bank ABC, respectively.

efforts,” the fund said earlier this year, adding that this support hinges on the country’s commitment and steadfast implementation of a comprehensive and ambitious reform programme.

Meanwhile, TotalEnergies began offshore oil and gas exploration in Lebanese waters in August, raising expectations that hydrocarbon revenues could rescue the cash-strapped nation from economic ruin and its citizens from penury.

A growing number of Lebanese lawmakers are also betting on a re b o u n d i n g to u r i s m s e cto r. Th e Mediterranean country expects to welcome 2.2 million visitors and earn

THOUGH BANKS’ FOREIGN-CURRENCY ASSETS AT BANQUE DU LIBAN WERE APPROXIMATELY $79 BILLION, THESE ARE NOT AVAILABLE TO THEM BECAUSE THE CENTRAL BANK’S READILY AVAILABLE FOREIGNCURRENCY RESERVES ARE BELOW $10 BILLION, EXCLUDING GOLD AND ITS HOLDINGS OF GOVERNMENT EUROBONDS – Fitch Ratings

Meanwhile, Capital Bank acquired 100% of Societe Generale de Banque au Liban’s Jordanian business in February 2022, a year after the lender completed its takeover of Bank Audi’s units in Iraq and Jordan.

Reviving the economy The IMF remains committed to supporting Lebanon and the fund continues to closely engage with the government in Beirut through policy advice and technical assistance.

“Collaboration and support from multilateral and bilateral partners are also critical for the successful implementation of the authorities’ reform

Banking and Finance news in the MEA market

as much as $9 billion in much-needed tourism revenue this year.

Speaking on the sidelines of the Arabian Travel Market in Dubai in May, Walid Nassar, the Minister of Tourism said Lebanon has spectacular tourism offerings despite its economic crisis.

“Tourism is the backbone of the national economy,” added Nassar.

Lebanon’s economic outlook remains uncertain and depends on the authorities’ policy actions. The implementation of a comprehensive economic recovery plan could steadily reduce imbalances and provide a policy anchor that will help restore confidence and facilitate a return to growth.

Cross-Border Payments Do you have a detailed line of sight? £

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PAYMENTS

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Change is happening Impending mandates around ISO 20022, Target 2, SWIFT gpi and regional payment rails has meant that migration paths for ease of adoption are a key consideration for market participants. Every payment rail will have its own flavour of exceptions and investigations, which if not handled correctly, can result in costly time-consuming processes.

SmartStream’s Advanced Payments Control solution puts you in control of the payments investigation and exception lifecycle. It brings a standardised and automated approach across different payment rails, significantly improving efficiencies in handling message queries.

Contact us for a free consultation smartstream-stp.com/payments

TRADE FINANCE

The Balances of Trade Trade Finance is undergoing changes and challenges as trade finance banks leverage innovative technologies and try to balance growing ESG requirements into its processes

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raditionally, the GCC region has always been a cornerstone of global trade, thanks to its strategic location at the crossroads of Europe, Asia and Africa, abundant resources and diverse economies.

However, we cannot ignore geopolitical tensions, a slowing global economy, highinterest rates and sticky inflation. “Tight financial conditions will increase pressure on highly indebted governments and

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businesses, amplifying vulnerabilities and deterring investments and trade flows,” the International Chamber of Commerce (ICC) said in a report in April.

No doubt the events of the past three years have had a devastating impact on global trade and the trade finance that powers it. Banks in the GCC region are playing a vital role in facilitating international trade by providing their clients with a wide array of offerings that include supply chain finance and trade finance.

Banking and Finance news in the MEA market

Trade finance supports an estimated 80% of global trade through a variety of financial instruments including letters of credit, trade loans, guarantees and insurance. Without it, global trade would grind to a halt.

Ac c o rd i n g to M c K i n s ey, t ra d e finance instruments allow enterprises to cover the inherent risks related to a cross-border trade transaction, whether counterparty risk or country risk. It underpins one of the most fundamental economic concepts – countries’ need to import and export goods and services based on their resources or lack thereof.

The latest data from the Asian Development Bank reveals that the global trade finance gap widened to a record $2.5 trillion in 2022, as heightened economic risks left banks’ financing capacity stretched.

The divide between what banks are prepared to provide and what borrowers need is impeding the ability of trade to fully support international economic growth. However, the ongoing digital transformation in the financial services sector offers banks a valuable opportunity to reimagine how they finance trade with no constraints and no legacy baggage.

For financial institutions, trade finance is among the most important products in the wholesale banking portfolio, notwithstanding its relatively small direct contribution to revenues. McKinsey said trade finance serves as an ‘anchor’ product that, given its transactional and recurring nature, generates multiple and frequent interactions with business clients throughout the year.

Redesigning trade finance Technology is reshaping the banking industry. While digitalising trade finance is imperative to supporting global trade recovery and growing small and mediumsized enterprises (SMEs), the reality is that the division has been relatively slow to modernise its decades-old processes.

Digitalisation holds the potential to improve documentation, testing, and risk governance models, meet regulatory risk-based demands, improve anti-money laundering policies and tighten up change control procedures.

The proliferation of networks, digital standards and digitisation efforts are constructive steps toward trade finance modernisation and inclusion. They validate the belief that market participants – including banks and credit insurance companies – recognise the importance of enhancing trade finance efficiency.

Oracle said to support the evolving needs of customers, a complete, endto-end application suite for digital trade and supply chain finance platforms must include digital onboarding, automated sanctions and anti-money laundering checks as well as electronic document creation and processing capabilities.

Global trade finance banks have already started leveraging innovative

technologies, with optical character recognition, AI and blockchain being used to develop innumerable use cases and proofs of concept.

London based HSBC executed a trade finance transaction, the first for the region’s automotive sector, between China’s SAIC Motor and Saudi Arabia’s Taajeer Group via the global lender’s Contour platform.

The digital platform has been instrumental in bringing down transaction lead times from 5-10 days to 24 hours. The bank’s digital receivables finance portal also reduced waiting time for working capital from 60 days to less than 48

Industry experts say trade finance functions that adopt appropriately targeted automation and advanced analytics as integral parts of their compliance operations will be more important than ever in this uncertain international environment.

A catalyst for growth The technological innovations in the financial services sector are accelerating structural changes in the payment space, which is expected to lower the cost of cross-border payments. “Crossborder payments are still expensive, slow and opaque,” the ICC said in its

TIGHT FINANCIAL CONDITIONS WILL INCREASE PRESSURE ON HIGHLY INDEBTED GOVERNMENTS AND BUSINESSES, AMPLIFYING VULNERABILITIES AND DETERRING INVESTMENTS AND TRADE FLOWS – The International Chamber of Commerce

hours, which significantly enhanced cash flow for its commercial and global banking corporate customers.

Historically, trade finance has been tied to paper because it relies on ownership of title documents, for which it is difficult to implement a universal digital solution. However, the use of blockchain and distributed ledger technology (DLT) in global trade makes it possible for documentation to flow transparently and securely between banks, trading companies and credit insurance companies.

Blockchain technology has the potential to empower global trade and banks that finance it by making transactions more efficient while retaining a high level of security. The World Trade Organisation said DLT could be to trade and trade finance transactions what the internet has been to communication.

2023 Trade Report: A Fragmenting World, adding that this is especially true for developing economies.

However, fintech companies and decentralised finance (DeFi) have the potential to increase the speed and reduce costs for cross-border payments traditionally offered by banks. Crossborder payments are important in the Middle East, with two of the world’s three largest remittance corridors located in the UAE and Saudi Arabia.

Three major initiatives have already been unveiled in the region including Project Aber, the Arab Regional Payment System (Buna) and the AFAQ system that connects the real-time gross settlement systems of GCC countries.

ICC and Swift released the first application programming interface (API) industry standards for bank guarantees and standby letters of credit. mea-finance.com

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TRADE FINANCE

APIs will provide standardisation and real-time visibility which will enhance interoperability, operational efficiency and enable seamless integration of banking capabilities into corporate treasury, enterprise resource planning systems and third-party platforms.

Banks and payments networks that process large cross-border transactions are upgrading their infrastructures to ISO 20022 standard that brings more effective real-time controls against fraud and money laundering as well as a range of richer new payment services that are yet to be developed.

The transition to ISO 20022 is expected to solve the interoperability between the two standards or two payment rails—the domestic and the cross-border. It has emerged as a common language and model for financial messages across the world as several Middle Eastern and Asian countries have already migrated their national payment infrastructures to ISO 20022.

The rich and structured data enabled

by ISO 20022 is an essential element of the next generation of payments. It’s the foundation for financial institutions to work smarter and faster, leading to greater operational efficiency, improved data analytics and compliance, new opportunities for innovation and enhanced customer experiences that promise to transform the payments landscape.

ESG alignment Environmental, social, and corporate governance (ESG) continues to be an area

TRADE FINANCE SERVES AS AN ‘ANCHOR’ PRODUCT THAT, GIVEN ITS TRANSACTIONAL AND RECURRING NATURE, GENERATES MULTIPLE AND FREQUENT INTERACTIONS WITH BUSINESS CLIENTS THROUGHOUT THE YEAR – McKinsey

of focus for banks operating in the trade finance industry, but translating this into concrete action is proving slow.

Banks in the GCC region have developed good suites of solutions that are environmentally linked and are in the process of broadening out the criteria to include the ‘S’, the social element of ESG. However, they face a challenge to ensure that stricter ESG criteria do not worsen the trade finance gap by cutting off access to financing for companies that need it most.

“As trade finance banks embrace ESG, some industry players worry that implementing stricter sustainability criteria into funding conditions will make it harder for companies to access trade finance,” said S&P Global.

The ICC is working with more than 200 banks, corporates and technology companies to define standards for sustainable trade and trade finance.

Globally, more banks are rolling out green or sustainability-linked equivalents of trade finance to meet

AS TRADE FINANCE BANKS EMBRACE ESG, SOME INDUSTRY PLAYERS WORRY THAT IMPLEMENTING STRICTER SUSTAINABILITY CRITERIA INTO FUNDING CONDITIONS WILL MAKE IT HARDER FOR COMPANIES TO ACCESS TRADE FINANCE – S&P Global

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Banking and Finance news in the MEA market

corporate demand and support their sustainability commitments.

Standard Chartered unveiled its sustainable trade finance solutions across Asia, Africa and the Middle East, Europe and the Americas in 2021.

The London-listed bank said the financing product will focus on supply chain finance, invoice financing, receivables ser vices, bonds and guarantees and letters of credit. “These products will help global supply chain activities – estimated at $19 trillion by the World Trade Organisation (WTO) – become more sustainable,” Standard Chartered said at the time of the launch.

Wall Street lender Citigroup followed last year with the introduction of new sustainable trade and working capital loan solutions in the Middle East, Asia Pacific, Europe, Africa and Latin America.

Banks and other players in global trade are collaborating to drive further growth in sustainable trade finance. Industry experts believe that how banks define sustainable trade will significantly have an impact on which companies can and cannot access financing with an ESG label.

With a significant trade finance gap – $2.5 trillion in 2022 – that disproportionately affects smaller enterprises, there is untapped growth in the market for both banks and fintech firms. Fintechs are already positioning themselves to address the financing gap by offering clients flexible access to liquidity while leveraging digital technologies that allow them to offer their services globally.

TRADE FINANCE

Primed for Purpose Asked about the development of trade finance, Madhavan Thooppal Head of Trade Services at National Bank of Fujairah says banks and financial institutions are well set to meet the requirements of its growing importance to the region’s economies

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re cross-border payments developments and bodies such as BUNA bringing marked improvements to the workings of trade finance across the region?

The success of trade finance is always measured on the speed of cross-border communication and settlement. Solutions such as BUNA will certainly speed up the transmission of trade finance messages, by providing a secured and automated platform that will significantly reduce the turnaround time for cross-border transactions (and thus improve efficiency). BUNA is also expected to enhance transparency in cross-border transactions, by providing real-time visibility of payment status, transaction history, and other important information, thereby reducing costs. BUNA will enable SMEs, which are currently underserved by the trade finance system, to participate easily in cross-border payments, thus improving financial inclusion.

Despite years of spotlight, Blockchain always seems to be about to happen, but can it find useful employment in trade finance?

Blockchain technology has started gaining significant attention in trade finance, and financial institutions have started making significant investments in the technology. Blockchain certainly has the potential to improve process efficiency, increase transparency by providing end to end visibility, speed up

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Madhavan Thooppal, Head of Trade Services at National Bank of Fujairah

the transfer of digital documents and digital approvals, and also reduce fraud.

NBF is implementing blockchain technology for its supply chain financing, whereby customers execute smart contracts and transfer the documents digitally on an end-to-end basis, without the requirement to submit paper copies.

This has improved the turnaround time for us to provide financing.

Blockchain has the potential to revolutionise trade finance in the coming years with widespread adoption overcoming regulatory challenges.

As the region’s businesses continue their growth, diversity and sophistication, are trade financing solutions keeping pace?

Currently the digitalisation of trade finance is taking place at a fast pace, which is also catalysing growth and economic diversity. New start-ups in diversified sectors are entering this region, with new ideas and technologies which are driving the economy and GDP forward. Banks therefore need to develop specialised trade finance solutions tailored to the

Banking and Finance news in the MEA market

unique needs of these startups. This region has a significant presence in global trade, with countries like the UAE serving as major trade hubs. Businesses in the region are engaged in international trade which requires advanced and sophisticated trade financing solutions which enable complex cross-border transactions while mitigating risk. In my view this region and its financial institutions are well-equipped to address these changing dynamics.

Are regional banks factoring in sustainability or ESG concerns into their trade financing options?

Banks in the region are already factoring in sustainability and ESG concerns into financing and business decisions, something that has come into particular focus as the UAE prepares to host COP28.

Given that trade finance is an important driver of the regional economy, banks are expected to engage with clients on ESG issues in the process of offering trade finance facilities. Banks are also coming up with tailored trade products like sustainable Letters of Credit and supply chain finance etc.

How is the economically important SME sector being catered for in their trade finance needs by the regions bank?

According to the UAE Ministry of Economy, SMEs account for 94% of all companies and provide 86% of jobs - a significant contributor to the economy. SMEs also account for about 63% of non-oil GDP in the UAE. NBF has a dedicated business segment to manage SME relationships which helps the bank to a have a better understanding of SME requirements.

We offer all types of trade finance products and solutions, including opening accounts, Letters of Credit, invoice discounting and export bill discounting through our online banking, catering to all of the trade financing needs of SMEs.

TRADE FINANCE

Places Trading Roula Jeha, CEEMEA Head of Global Trade at J.P. Morgan describes the historical importance of the region in connecting people and places that trade, how financial institutions and businesses are keeping pace with developments and the newer considerations that are coming to the fore

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re cross-border payments developments and bodies such as BUNA bringing marked improvements to the workings of trade finance across the region?

Some intra-regional payment schemes have emerged with the aim of accelerating settlement times, providing clarity on fees and improving the customer experience – all encouraging initiatives for trade transactions.

Notably, BUNA operated by the Arab Monetary Fund and AFAQ by the Gulf Payment Company are two developments in cross-border payments that intend to support the fiat currencies of the participant countries as well as other global currencies.

These developments are more significant when viewed from a broader G20 roadmap for enhancing crossborder payments. All such efforts have a number of similar themes and challenges including domestic compliance and policy development across jurisdictions.

It would be interesting to watch this space as it evolves further given the impact it can have on payments and trade finance.

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Roula Jeha, CEEMEA head of Global Trade at J.P. Morgan

Despite years of spotlight, Blockchain always seems to be about to happen, but can it find useful employment in trade finance?

Despite years in the spotlight, there has not been a compelling use case for blockchain in trade finance.

Banking and Finance news in the MEA market

We have witnessed multiple trade use cases for distributed ledger technology (DLT) from expediting the processing of letters of credit to facilitating bank payment undertaking (BPU) or detecting fraud. Banks have joined forces to form consortia and partnered with fintech platforms and blockchain based startups to disrupt commodity trade finance, including Contour, we.trade, Komgo.

Yet , t h e d o l l a r i nve st m e n t i n blockchain digitisation did not generate the proportionate return, particularly in ramping to scale, leading to providers scraping or repurposing their underlying technology and architectures.

Perhaps, the most successful instance of blockchain is the movement of money, whether through tokenisation of assets or cryptocurrencies. For example, at J.P. Morgan, our proprietary JPM Coin leverages DLT. While the tool has been piloted within the working capital space, there is still a lot of opportunity for new applications here – maybe one day a whole ecosystem will settle trade transactions utilising JPM Coin.

The pressing question remains: what is the problem you are trying to solve? And how does DLT ameliorate this issue? Blockchain is nothing but a distributed ledger supported by the necessary encryption to secure data. It is an enabler rather than a solution, and the goal must be to deliver functionality, not only technology.

Machine learning algorithms on the contrary are making a profound impact on trade finance. The J.P. Morgan and cleareye.ai alliance leverages AI and machine learning to streamline the onerous due diligence processing associated with trade transactions.

In order for all of these innovations to have an impact, the necessary building

blocks need to be in place, so the end-toend supply chain impact can be felt.

As the region’s businesses continue their growth, diversity and sophistication, are trade financing solutions keeping pace?

Shifting global powers lead to new geopolitical alliances and trade corridors; the diplomatic activity in MEA is spurring further government-to-government relationships and cooperation, increasing the role of multilaterals and export credit agencies across the markets. These trends along with government visions and an unprecedented growth trajectory continue to drive the evolution of the working capital and trade finance toolkit.

Beyond just the energy transition agenda, ambitious plans for social and economic prosperity of local countries set the bar high for and exert pressure on trade banks to keep pace. Digitisation is the name of the game as businesses demand smooth access to working capital instruments in order to achieve resilience across their supply chains.

Banks are filling this gap by embracing fintech solutions and partnerships.

MEA has witnessed a steady increase in demand for payables solutions. The SCF asset class continues to grow and increasingly accommodates client KPIs built to enhance sustainable measures and boost financial inclusion.

Banks are offering online trade finance platforms to facilitate the access of SMEs to funding. New opportunities are also emerging in the region such as the Arab-African trade corridor, coupled with continuous adoption of new strategies and policies evident by the development of the UN Commission on International Trade Law’s (UNCITRAL) Model Law on Electronic Transferable Records (MLETR) in ADGM and Bahrain.

Are regional banks factoring in sustainability or ESG concerns into their trade financing options?

Maybe the last frontier of ESG integration, the Middle East is demonstrating an

ambitious approach to addressing sustainability concerns. Certainly, regional banks are part of the initiative, but this is heavily driven by government visions and systemically important corporations who have a commanding influence in the GCC. In support of government and client ESG frameworks, Middle East banks are integrating sustainability guidelines and product development in their scope of work, designing policies to broaden opportunities and reduce costs. This could take the form of providing liquidity to importers via trade instruments where the underlying flow supports renewable energy or net-zero goals.

THE PRESSING QUESTION REMAINS: WHAT IS THE PROBLEM YOU ARE TRYING TO SOLVE? At J.P. Morgan, we offer ESG-linked SCF to fund suppliers who satisfy predetermined ESG KPIs, offering them competitive rates. As the majority of carbon emissions resides within SMEs in the supply chain, such a solution motivates stakeholders to improve their ESG performance and aims to provide necessary financing to smaller enterprises.

M E A b a n ks i n p a r t i c u l a r a re broadening their scope of reporting beyond just environmental metrics to look at the social data aspects and DE&I engagement of the workforce, addressing societal development goals.

Tra d e f i n a n c e s o l u t i o n s a re constructed to empower clients to seize control of their cash position, allowing them to invest that released capital into energy transition projects or emissions reduction goals.

How is the economically important SME sector being catered for in their trade finance needs by the regions bank?

The key obstacle SMEs face when seeking necessary financing is difficulty of access. Unlike large corporates with dedicated finance departments, typical SMEs operate with minimal resources and capacity to collate the required manual records. This coupled with the fact that SMEs have limited access to the international banking sector contributes to the burden of limited capital accessibility.

However, institutional visions propelled by social and economic responsibility goals incentivise large corporates to bolster and protect the local SME community as an integral part of supply chains. Governments and banks recognise SMEs as the backbone of the economy and essential participants to driving sustainable growth; the trade offering is evolving to account for the nuances of local SME client behaviour.

International and regional banks are adopting technology to streamline trade finance processes, including online applications, e-documentation and realtime transaction tracking. These efforts lower the funding accessibility barrier and simplify documentation requirements for SMEs applying for trade services.

Recent events have demonstrated that digitisation democratises access to goods, services and capital. At J.P. Morgan, we strive to make our digital trade tools available to smaller companies. For example, our digital SCF solution provides a frictionless onboarding experience, which is critical to scaling all suppliers.

More energy needs to be channelled towards supporting minority-owned businesses, who often have fewer channels to access bank lending and regularly face more challenges to operate at scale. J.P. Morgan has developed a preshipment finance programme specifically focused on disadvantaged suppliers.

These loans will not require an underlying purchase order, allowing suppliers to achieve increased financial stability even earlier in the cash conversion cycle. mea-finance.com

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ARTIFICIAL INTELLIGENCE

AI - Only as Good as the Data that Fuels it George Kurian CEO at NetApp puts the case that data and its competent application is what will make AI truly successful, describing how to optimise your data engine to make the best of intelligent technology

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rtificial intelligence (AI) has recently been described in many ways—revolutionary, an economic game changer, a “beast” that is either overhyped or underhyped. I like to think about AI as a new frontier in the great tradition of tools that have propelled humankind forward—the next stage of the information revolution, like the industrial revolution or the scientific revolution that came before. And like any of the significant innovations before it, AI has the possibility to become a source for good, or a source for chaos.

AI holds great promise for businesses: Predictive AI, powered by machine learning, is already being used to recognise patterns, drastically improve efficiency and solve business and social problems better and faster than anything we have seen. It can be used to improve medical research, like predicting how proteins fold to affect biological functions. It can help detect financial fraud to protect both customers and the company’s bottom line. It can aid

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George Kurian, CEO at NetApp

natural disaster planning by better predicting crises and their ripple effects.

We know because we have been helping customers achieve these AI-driven objectives for many years.

And generative AI not only recognises patterns but also generates new patterns.

This capability can enable software developers to be more productive, help

Banking and Finance news in the MEA market

content creators deliver much more immersive experiences and make it far easier for customers, employees, citizens and students to find the information they need.

All of these possibilities are made by one thing: data. This has long been true—better datasets have allowed prior generations of AI tools to deliver better predictions, and by using very large datasets, large language models have powered generative AI to achieve new levels of capability. Current innovations are rapidly improving these foundation models by using customers’ private data to provide better context or to fine-tune an existing model and make better decisions. The eminent computer scientist Peter Norvig summarises it elegantly: “More data beats clever algorithms, but better data beats more data.”

Simply put, AI is built on a foundation of data—data storage, safety and accessibility is critical to the insight and analysis provided by AI. And the AI capabilities of your organisation are only as competent as the data that fuels it.

What this moment needs: integration, performance, and trust Operationalising AI requires managing multiple versions of models and keeping them up to date with the latest datasets. This means that massive amounts of data must flow freely—whether that is the enterprise’s own data or other relevant datasets that customers use to improve their AI systems.

Of course, we know better than anyone that this is not the data equivalent of opening a spillway on a dam. Not only is the volume of data massive and unrelenting, but it is scattered, often unstructured and needs to be protected. Complex technology and disparate organisational and data silos are major hurdles to getting AI projects into production. To help you capitalise on the best of AI, you need the most complete, powerful and sustainable solutions, without the bottlenecks of traditional data silos.

Having a modern, intelligent, integratedhybrid cloud data infrastructure is the foundation of AI. Whether you are a small or large business, here is how you can optimise your data engine to take advantage of the intelligent technology revolution: Ensure that your data and AI organisation are integrated. Often the biggest gap in organisational readiness for an AI-powered, datadriven future is the fragmented ownership of data, siloed data platforms and infrastructure and a disparate range of specialists who operate in silos. For example, many organisations have data analysts and engineers who deeply understand the data, data scientists who can apply modern data analytic tools to that data and business analysts who understand how to apply data and AI recommendations to drive business outcomes. These roles need to work closely together as one team to accelerate AI impact.

Assess and consolidate your unstructured data. For many years, businesses have

invested in tools to extract value from structured data such as databases, data warehouses and business intelligence tools.

Generative AI, however, provides a powerful engine to derive value from the majority and fastestgrowing part of a company’s data— that is, unstructured data. Text is still the leading format of most organisations’ data; documents, audio files and large files like imaging and videos constitute the largest percentage of a company’s data. Natural language processing (NLP) and computer vision (CV) are among the most mature AI

SIMPLY PUT, AI IS BUILT ON A FOUNDATION OF DATA tools, and certainly the fastestapplication in generative AI, make sure you have an up-to-date view of your unstructured data landscape and its relevant applications so that you are ready to use them with the generative AI applications for your business.

I ntegrate your workloads and data with intelligent hybrid multi-cloud infrastructure. Data volumes, types and speeds are growing inexorably. With massive amounts of data to process, simplicity and integration go a long way. A data pipeline is effectively the architectural system for collecting, transporting, processing, transforming, storing, retrieving and presenting data.

Today’s leading-edge AI teams

want to marry the scalability and unrelenting pace of innovation of the public clouds with the security and governance of on-premises environments by building hybrid cloud data pipelines.

P rioritise the securit y and g ove r n a n c e of yo u r d a ta .

With great power comes great responsibility. The saying might be trite, but there is a reason for its ubiquity, and it is particularly relevant to AI. AI has benefits from a security standpoint—it can identify cyberthreats in real time and create models for error detection— but it also can be dangerous. With AI, your private data is far more valuable, but it can be a source of errors, bias and other inaccuracies in your model. So, it needs to be well secured and well governed.

By optimising your data engine, you can have a solid foundation to unlock the power of AI while doing so responsibly, safely and affordably.

NetApp’s place at the forefront of change Data and data infrastructure is what we do best. For 30 years, through successive technological and business model revolutions, we have not only endured, but also capitalised on each of these changes to deepen our expertise, help our customers navigate a changing world and drive our own business. We were here when client-server computing became the norm, when businesses migrated sales to the internet, when cloud became the disruptor and when hybrid became the solution.

As a result, we know what businesses need even as technology changes. AI is no different. We have enabled customers to use AI techniques to advance drug development and disease diagnosis, improve manufacturing and customer service and reduce fraud, waste and risk. And we use AI every day to develop and make our products and services much better. mea-finance.com

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PARTNER CONTENT

The Role and the History of the International Chamber of Commerce (ICC) Vincent O’Brien Director of the International Chamber of Commerce, United Arab Emirates (ICC UAE) shares his insights on how the ICC can help sustain the trajectory of the UAE becoming the leading global trade hub

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hat positions the ICC to uniquely function as the global connector for trade facilitation between advanced and emerging economies?

The International Chamber of Commerce (The ICC), the world business organisation, has a global network operating in more than 130 countries. ICC Trade Facilitation Rules, on a day-to-day basis provide the solid foundations to support international trade transactions valued at trillions of dollars by underpinning contractual obligations and payment security across the globe.

You will find ICC rules being used on a daily basis in the largest of the large nations and yet at the same time, used on the daily basis in the smallest of the small nations. For instance, practically every single letter of credit financing international trade is issued subject to the ICC rules “the UCP600’.

How has the ICC evolved into this position as the great trade connector as you call it?

This great ICC story started more than 100

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Vincent O’Brien, Director of the International Chamber of Commerce, United Arab Emirates (ICC UAE)

years ago, way back to 1919, when the ICC was founded at that time during a state of geopolitical and economic uncertainty in the aftermath of the First World War. Back then, there was no world system of rules governing trade, investment, finance or commercial relations. The original group of men and women that founded the ICC were determined to replace fear

Banking and Finance news in the MEA market

and suspicion between countries with cooperation to facilitate international business. Acting on their conviction that the private sector is best qualified to set global standards for business, they called themselves “Merchants of Peace”.

Fast forward to 2023 and we can see that the ICC is truly a global network of connectivity and cooperation of trading partners. The current membership of the ICC is now more than 40 million members, comprising of associations, corporations, inter-governmental organisations, multinationals, SMEs and independent professionals.

When it comes to international business, the ICC is the ultimate connector. The ICC and its mission is to make business work for everyone, ever y day, ever y where. Business can only flourish within a truly connected ecosystem.

The World is facing geopolitical a n d e c o n o m i c c h a l l e n g es , what initiatives is ICC UAE undertaking to keep the wheels of trade turning?

I agree, the world is once again facing significant geopolitical challenges. The UAE leadership has provided a peaceful pro-business environment driven by professionals from more than 200 countries, this, in my mind is a role model for the business world.

However, to answer your question and get down to brass tacks, here are some specific initiatives of ICC UAE that have greased the wheels of international trade:

I CC UAE has partnered with the UAE Banks Federation in a study of bank guarantee practice within the United Arab Emirates. This study resulted in a recommendation for the application of ICC’s rules known as URDG758 (Uniform Rules for Demand Guarantees) to bank guarantees issued in the UAE. ICC UAE has acted as co-organiser with the ICC International Court of Arbitration for the ICC MENA C o n fe re n c e o n I nte r n a t i o n a l Arbitration for many years. The 12th edition of this ICC MENA event will again take place on 26-28 February 2024 in Dubai. Gathering over 250 of the top legal and arbitration brains in the World.

ICC UAE has hosted 2 Global Meetings of the ICC Banking Commission with the support of Dubai Chambers, more than any other venue (other than ICC HQ in Paris). This event brings trade finance bankers from all corners of the World together working on the establishment and enhancement of international trade finance, standards and rules for trade and the advancement of digital trade.

ICC UAE will host the ICC Digital Standards Initiative (ICC DSI), a global initiative spearheaded by the ICC. This program is already fast tracking the evolution and application of universal standards for electronic documents or records acceptable to global trade stakeholders.

ICC UAE, with the support of Dubai Chambers has delivered The Global Trade Facilitation Summit in partnership with representatives of the WTO, World Bank, EBRD, ADB, ITFC and banks from emerging markets across the globe. The UAE Banks Federation has also been a great enabler for this global event. The 3rd edition of this flagship event “GTFS2024 will take place, again at Dubai Chambers, during the full week commencing Monday 29 April 2024. This gathering of global experts demonstrates real

life cases on how traders can secure payments and finance trade with what are considered high risk emerging markets. Once again, underpinning the role of the UAE as a global trade hub.

Does the ICC UAE venture to other countries to build trade and relationships?

I am very glad that you asked that question.

During the pandemic our Chairman, HE Humaid Ben Salem gave the executive team of ICC UAE clear and firm direction to reach out and support other chapters of the ICC UAE in a spirit of cooperation.

This initially was by way of virtual training workshop and technical assistance.

However, this has since evolved into a

reliable partners with a common focus on commerce and facilitating trade development.

What is the role of ICC at COP28?

The International Chamber of Commerce will play a significant role in the upcoming COP28 hosted by UAE in the Expo City of Dubai. Preparations for COP28 are indeed well underway from the ICC side. As the voice of the real economy in the UN climate process ICC will again engage prominently on several critical issues up for discussion in Dubai.

For the second time, ICC will host the central business pavilion in the COP28 blue-zone – a unique space to enable dialogue between the private

ACTING ON THEIR CONVICTION THAT THE PRIVATE SECTOR IS BEST QUALIFIED TO SET GLOBAL STANDARDS FOR BUSINESS, THEY CALLED THEMSELVES “MERCHANTS OF PEACE” highly dynamic programme of physical cooperation and physical visits for technical training events. In the past three months ICC UAE has participated and lead events in Hanoi Vietnam, Dhaka Bangladesh, Mumbai India, Yerevan Armenia, Amman Jordan, Ulaanbaatar Mongolia, Singapore and most recently on 16 and 17 September in Nanjing China.

We have physical events scheduled for the forthcoming 2 months in the priority markets of Egypt, Turkey and Philippines.

What has been the key to the success of ICC UAE? First and foremost, operating in the environment of the UAE which encourages innovation, diversification, collaboration and intelligent risk taking has made a huge positive impact in empowering ICC UAE to box way above our weight.

Secondly, knowing that we cannot succeed alone. We need long-term

sector, governments and civil society on the structural changes and enabling policies needed to implement the Paris Agreement. ICC is currently developing a high-impact events programme and will also host daily COP28 briefings every morning, open to the whole business community.

What do you see as the most important aspect of your work with ICC UAE? In a nutshell, I see my role as enabling and sustaining the trade facilitation activities of our members which in turn promotes global cooperation, sustains trade and fosters economic development, all going back to the transformational work of our founding member – The Merchants of Peace.

It is a tremendous privilege to serve the trade community working for the International Chamber of Commerce, the World Business Organisation. mea-finance.com

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RISK MANAGEMENT

Running to Stand Still Risk is broadening to include more considerations and newer priorities and though banks have made dramatic changes to keep on top of risk management in the past decade, the pace of change shows no signs of slowing

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he financial services sector is currently in a period of heightened change and uncertainty. From economic uncertainty to high-interest rates to ESG concerns, the banking industry is enduring unprecedented change and new models offering efficient and flexible infrastructures are needed.

“Changing regulatory environment and increasing geopolitical risk are shaping the external environment while growing competition among banks and

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financial technology firms is reshaping the competitive field,” said McKinsey.

Risk management is a fundamental, vast and fast-evolving part of a bank’s business that encompasses credit, market, operational, liquidity, technology and information risks. Cybersecurity remains at the top of the executive agenda, and banks are allocating more resources and investment to strengthen their cybersecurity defences.

A sur vey by EY revealed that cybersecurity has risen to the top of the

Banking and Finance news in the MEA market

list of near-term risks for banks around the world amid unprecedented levels of global volatility and uncertainty. Global banking chief risk officers (CROs) see climate risk, change through digitisation and data integrity as the top emerging risk priorities for regulators over the next five years.

On credit risk, soaring interest rates to curb inflation, low unemployment, elevated commodity prices, strong but evolving consumer balance sheets and geopolitics are among the factors leading to bouts of financial and economic volatility – and deepening uncertainty for bank credit exposures.

Though relative calm has been restored since the collapse of three US lenders and Credit Suisse Group earlier this year, the financial services sector is calling for more coordinated interventions amid fears that tumult in the global banking sector will continue due to rising interest rates.

The Bank for International Settlements (BIS) said the recent market turmoil

exposed heightened vulnerabilities of banks with material exposures in longterm, fixed-rate assets that are fuelled by shorter-term, less stable funding.

Banks are naturally exposed to risk due to the nature of their business, which involves handling financial assets, investments, and the liabilities that come with them.

Cybersecurity Financial institutions are a prime target for cyberattacks due not only to the money they have but also the data their systems house. “Cyber resilience continues to be a top priority for the financial services industry and a key area of attention for financial authorities,” said the BIS. This is not surprising given that cyber-attacks pose a significant threat to the stability of the financial system and the global economy. The financial services sector performs several key activities that support the global economy such as lending, payments and settlement services.

A cyber-attack can knock out the i n fo r m a t i o n a n d c o m m u n i c a t i o n technologies that support these activities and can lead to the misuse and abuse of data that such technologies process or store.

The FS-ISAC, an industry group dedicated to reducing cyberattacks in the financial services sector, warned in its Navigating Cyber 2023 report that cyber threats remained elevated for much of 2022 across all regions including the Middle East.

The group cautioned that ransomware gangs are retooling to dodge increased scrutiny after an unrelenting year of fighting off cyber threats in 2022.

The wave of digitalisation in the banking sector across the Gulf region is a prime example of how financial institutions are leveraging customer data, analytics and segmentation to improve their products and services as well as build a ‘bank of the future.’

Though digital transformation in the financial services sector is creating some

CHANGING REGULATORY ENVIRONMENT AND INCREASING GEOPOLITICAL RISK ARE SHAPING THE EXTERNAL ENVIRONMENT WHILE GROWING COMPETITION AMONG BANKS AND FINANCIAL TECHNOLOGY FIRMS IS RESHAPING THE COMPETITIVE FIELD – McKinsey

unique opportunities, it is also creating some exceptional challenges for the industry including cyberattacks. Global cybercrime costs are projected to grow by 15% per year over the next five years to reach $10.5 trillion by 2025.

Meanwhile, despite cyber risks being a growing threat to the operations and credit profiles of financial institutions, there have not been any major interruptions to the operations of banks in the Middle East.

“GCC banks laid the foundation for success over several years by investing in infrastructure and systems, including equipment and software, to minimize their exposure to cyber risk, while also benefiting from supportive regulatory frameworks and cyber risk requirements,” said S&P Global.

The UAE Banks Federation (UBF) reiterated its commitment to a secure and smooth banking experience, including initiatives related to cybersecurity, to increase trust and develop the country’s banking sector.

“Cybersecurity is of paramount importance to UBF and the banking sector, which is a vital driver of the global economy, especially in the digital age that has changed the way financial transactions and asset management are handled,” Jamal Saleh, Director-General of UAE Banks Federation said the 3rd Cybersecurity Conclave in September.

Banks spend nearly 11% of their budgets on defending themselves

against cybercrime, according to Deloitte.

For very large banks, which can mean spending more than one billion dollars a year.

With banks seeking to create new digital customer experiences, applying sophisticated data analytics and investing in a wealth of other technology innovations, cyber risk management requires governance at the highest levels.

Effective cybersecurity risk management is critical to protect banking institutions from cyberattacks and minimise the risk of data breaches.

Cloud Security With customer expectations and technology evolving at breakneck speeds, moving to the cloud is increasingly becoming a strategic priority for banks.

Furthermore, banks are under rising pressure to find innovative ways to reduce costs and increase operational efficiencies.

Cloud solutions allow financial institutions to augment the accessibility of their services and products from multiple locations and streamline their operations while creating an opportunity to deliver new and enhanced digital products.

By adopting cloud computing technologies to make their systems accessible from multiple locations, financial services companies are launching new, improved digital products while streamlining their operations. mea-finance.com

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RISK MANAGEMENT

But, at the same time, cyber specialists are warning that this cloud migration is exposing companies to a greater risk of cyberattacks and data breaches – as well as the fines and reputational damage they can bring.

The BIS cautioned in July 2022 that the financial sector’s increased reliance on cloud computing was “forming single points of failure” and “creating new forms of concentration risk at the technology services level”.

“Security is different in the cloud because of the tools that are native to each cloud provider’s environment and the fact that cloud providers typically take responsibility for the security of the lowerlevel infrastructure layers,” according to Deloitte.

The shared security responsibility between cloud providers and the clients they host changes how organisations should anticipate and prepare for security risks. Cloud banks offer several benefits for financial institutions, including cost savings, improved agility and increased efficiency.

However, as with any new technology, there are risks associated with banking in the cloud. To fully capitalise on the benefits of the cloud while mitigating these risks, financial institutions need to implement comprehensive cloud security solutions.

Cybersecurity remains a hot topic within cloud computing, though the consensus is that previous fears may have been blown out of proportion as major players in the cloud space including Google, Amazon, IBM and Microsoft are applying encryption measures and security protocols that surpass what banks can implement.

Data security Front-to-back digitisation of the customer journey requires developing a data- and analytics-powered digital experience that provides personalised engagement, efficiency and convenience throughout the journey at low cost.

Technological innovations such as open APIs and cloud-native solutions

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GCC BANKS LAID THE FOUNDATION FOR SUCCESS OVER SEVERAL YEARS

BY INVESTING IN INFRASTRUCTURE AND SYSTEMS, INCLUDING EQUIPMENT AND SOFTWARE, TO MINIMIZE THEIR EXPOSURE TO CYBER RISK, WHILE ALSO BENEFITING FROM SUPPORTIVE REGULATORY FRAMEWORKS AND CYBER RISK REQUIREMENTS – S&P Global

enable banks to leverage data to augment their services and allow them to take action quickly when required. However, data security concerns are top of mind for bank leaders.

“Regulators handed out just $4.2 billion in enforcement actions for non-compliance with a wide range

CYBERSECURITY IS OF PARAMOUNT IMPORTANCE TO UBF AND THE BANKING SECTOR, WHICH IS A VITAL DRIVER OF THE GLOBAL ECONOMY, ESPECIALLY IN THE DIGITAL AGE THAT HAS CHANGED THE WAY FINANCIAL TRANSACTIONS AND ASSET MANAGEMENT ARE HANDLED – Jamal Saleh

Banking and Finance news in the MEA market

of regulations in 2022, including data privacy,” according to regulatory technology firm Fenergo.

B a n ks a n d f i n a n c i a l s e r v i c es companies worldwide have failed to invest sufficiently in the field of data security. While banks and other financial services operations should ensure sound data protection policies and procedures are implemented and communicated to staff, these should be supported with technical tools and monitoring processes to oversee network activity and prevent data loss.

B a n ks a re p r i m e ta rg et s fo r cybercriminals who are always looking for new ways to steal money, data and customer information. Institutions are effectively in a constant battle of innovation, where banks need to continue to invest heavily, to predict and combat emerging threats from sophisticated criminals.

Financial institutions in the GCC re g i o n m u st b o l ste r t h e i r d a ta security capabilities with technical and operational changes as the sophistication, frequency and range of ransomware attacks increase.

The increase and sophistication of cyber-criminal activities also call for both customers and financial services providers to consider the data security protocols of their suppliers and other third parties.

Managing investments in developing markets is not smooth sailing

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OPINION PIECE

CARD-CENTRIC CHOICES:

The Journey in Payment Processor Selection Saad Ansari Co-founder and CEO at Xpence, delves into the complexities of selecting card processors in the Middle East, underscoring the transformative impact of informed decisions in the fintech landscape.

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he Middle East, particularly Saudi Arabia and the UAE, has witnessed a meteoric rise in card transactions. As businesses strive to meet the demands of this digital age, the importance of selecting the right issuing payment processor cannot be overstated. But it is not just the traditional banks that are in the card issuing game.

The region is experiencing a fintech boom, leading to a plethora of unique card offerings. From card products tailored for children to innovative corporate cards that are revolutionising business spending, the landscape is evolving rapidly, offering consumers and businesses alike a wider range of choices than ever before. However, it is worth noting that relying solely on an interchange-based business model might not be sustainable in the long run. Payment cards have a certain allure, acting as a hook to reel customers in, but the real value lies in building lasting relationships and diversified revenue streams beyond just transaction fees.

buzzing with change. With projections indicating a growth spurt of 10.20% annually from 2023 to 2027, the market is set to touch a whopping $209.50 billion by 2027’s end. A lot of it can be attributed to the nation’s Vision 2030 initiative.

This ambitious plan is all about pushing e-payments, aiming to make them account

T h e M i d d l e Ea st ’s C a rd Payment Revolution: Spotlight on Saudi Arabia and the UAE Saudi Arabia’s card payment scene is

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Banking and Finance news in the MEA market

for 70% of all transactions by 2025. In just 2021, the average Saudi shopper made around nine credit card payments, a notable jump from the year before. Whilst most of these were online, Saudi Arabia is also setting the benchmark in contactless payments. With a 94% adoption rate, it is not only leading the Middle East and North Africa but also outpacing regions like the European Union.

Meanwhile, the UAE is not far behind in the card payment race. The market there is gearing up for a 14.50% growth in 2023, aiming for a total of AED 265.20 billion ($72.20 billion). This growth has been consistent, with the card payment value soaring by 23.50% in 2021 and another 18.40% in 2022. Credit cards have been a significant player, accounting for 17% of the UAE’s total card payment value in 2022. The UAE government has been proactive in this digital shift, introducing initiatives like the UAE Pass, a national digital identity and signature solution, to promote e-payments in everyday transactions.

The Role of an Issuing Payment Processor: An issuer processor is a pivotal e l e m e n t of a n e l e c t ro n i c p a y m e n t s y s t e m , t a s ke d with overseeing the intricate processes involved in the authorisation, clearing and settlement of transactions.

It acts as a bridge connecting financial institutions, fintechs Saad Ansari, Co-founder and CEO at Xpence

and cardholders within the payment ecosystem, ensuring that transactions are executed both accurately and securely. Beyond their primary function in payment processing, issuer processors might also extend other services such as card management, reporting and analytics, or even dispute and chargeback management, all facilitated through APIs.

Ke y C o n s i d e r a t i o n s W h e n Selecting an Issuer Processor:

Efficient Transaction Processing: Opt for a processor that provides the necessary tools and infrastructure to manage cardholder accounts, authorise transactions and settle payments swiftly and efficiently.

Fraud Detection and Prevention: Advanced fraud detection and prevention measures, like real-time monitoring, are essential to detect and thwart fraudulent transactions.

Card Management Capabilities: The processor should allow easy management of payment cards and offer cardholders self-service features like balance checks and transaction history insights.

Enhanced Customer Experience: A processor that ensures rapid and reliable transaction processing can significantly enhance the customer experience, fostering increased loyalty and retention.

Cost Efficiency: By leveraging the right infrastructure and resources, significant cost savings and operational efficiencies in payment processing can be achieved.

Difference from Acquirer Processor: It is vital to understand the distinction between an issuer processor and an acquirer processor. While the former manages processes for the financial institution issuing payment cards, the latter handles transactions on behalf of merchants accepting card payments.

Technical Capabilities: Consider the issuer processor’s technical prowess, especially their use of APIs to facilitate c a rd p a y m e n t p ro c e s s i n g , f ra u d detection and other related services.

These APIs should also promote smooth integration between various systems

IN FINTECH, WHILE WE FREQUENTLY DISCUSS LEGACY TECHNOLOGY, IT IS THE LEGACY MINDSETS THAT CAN BE MORE DANGEROUS. and services, catalysing data flow and digital innovation within the industry.

Xpence’s Journey in the World of Payment Processors: At Xpence, our journey with payment processors has been both enlightening and challenging. We have integrated with five different payment processors, spanning from the UK to the UAE. The swiftest of these integrations saw us issuing our first card and executing a payment in just six weeks. Such milestones, while celebratory, also came with their fair share of lessons.

Our core system, built in-house, was designed with foresight. We ensured it was agnostic, having the capability to seamlessly connect with multiple payment processors across various geographies, whilst ensuring a uniform experience for all of our cardholders. This strategic decision allowed us greater flexibility and scalability, vital for our business model.

Modern processors, while technologically advanced, brought their own set of challenges, including inexperience and platform instability.

Traditional processors, on the other hand, often came with legacy technology and, sometimes more detrimentally, legacy mindsets. In fintech, while we frequently discuss legacy technology, it is the legacy mindsets that can be more dangerous.

The combination of both is something that should be avoided at all costs during the selection process.

O u r key c o n s i d e ra t i o n s w h e n choosing processors were primarily based on data and card control, the platform’s ability to innovate and the alignment with our mission to give employers complete control over how their teams spend using the Xpence

Visa card. Price, interestingly, was often the last factor on our list. We always prioritised our cardholders, focusing on the problems we were solving for them and how our chosen processor could aid in that mission.

In many instances, our choice boiled down to the people behind the processors.

We were entering into long-term contracts, often spanning five years. Switching processors is not a decision made lightly; it is a massive undertaking that can take months. Walking away from a processor prematurely can also result in heavy financial penalties. In some cases, our choice of payment processor was influenced by our sponsoring bank. One such directive led us to almost collaborate with a global payment processor, which, to our surprise, was soon embroiled in one of Europe’s most significant financial scandals in recent years, and now the subject of a popular docudrama on Netflix.

Conclusion Navigating the intricate landscape of issuing payment processors is no small feat, especially in the rapidly evolving markets of the Middle East. At Xpence, our journey has been marked by meticulous selection, learning from experiences and a relentless focus on our cardholders.

The right payment processor does not just facilitate transactions; it becomes an integral part of the business ecosystem, driving innovation and ensuring customer satisfaction. As the region continues to embrace digital payments, businesses must prioritise adaptability, security and customer-centricity in their choice of payment processors. After all, in the world of fintech, the right partnerships can make all the difference. mea-finance.com

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BANKING TECHNOLOGY

No Time to Pause

Serkan Arslan Sales & Business Development Director at Fineksus, talks about the effects of digitisation on the regulation technology sector, the ever-evolving threats from fraud, and details the growing regulatory pressures to maintain AML standards

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ineksus provides services in 32 countries, so can you tell us how the Middle East features in your overall activities?

When we look at the last three decades, the Middle East has thrived tremendously, and the UAE has especially been a catalyser for this improvement in information technology services and become a key role player in building a Financial Tech Hub. At Fineksus, we wanted to be at the heart of this transformation and decided to open our first regional office in Dubai in 2014 to help our clients in the MENA region.

Our passion is to tackle Financial Crime with AI powered solutions and to provide secure, effective and frictionless payment systems for local or cross border.

We also have a SWIFT Certified Service Bureau where we provide connectivity and hosting services to our clients who want to benefit from Fineksus’ over 20 years’ experience in SWIFT’s financial telecommunication world.

What has been the effect of the rapid growth of digitisation on the regulation technology sector?

Serkan Arslan, CAMS, Sales & Business Development Director, Fineksus

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Banking and Finance news in the MEA market

Emerging technologies and postpandemic uncertainty in the global economy have had a profound impact on the financial industry, most notably by significantly accelerating the adoption of digital financial processes. As society increasingly embraces cashless transactions, various industries, including e-commerce and cr yptocurrency platforms have adapted to this new economic landscape. However, this rapid evolution has also had consequences in the realm of financial crime, as criminals have been compelled to devise new methods to exploit the system and target unsuspecting victims.

Also, several factors contribute to the rise in financial crimes. Firstly, the uncertainty in the global economy due to recessions led to an increase in fraud and financial crimes, in contrast, the

financial industry sped up the digital transformation process to mitigate risks and combat financial crimes, by forcing businesses and individuals to rely more heavily on safe digital platforms for financial transactions with increased security checks. This rapid shift created vulnerabilities that criminals have been quick to exploit and adopt. Additionally, the expanding digital channels have posed challenges in terms of regulatory compliance, making it harder for authorities to monitor and regulate financial activities effectively.

As a c o n s e q u e n c e, e m e rg i n g technologies and post-pandemic uncertainty in the global economy have not only expedited the digitisation of finance but have also ushered in new challenges in combating financial crimes and eventually contributed to the rapid growth of the digitisation in the RegTech industry. As we continue to navigate this evolving landscape, it’s essential for both businesses and regulators to adapt and stay ahead of those who seek to abuse the system for illicit gains.

As the region develops larger and more sophisticated financial hubs, how will the AML landscape and requirements develop here?

The global battle against financial c r i m e i s a f i g ht t h a t h a s m a ny trenches, from governments, regulatory bodies and industries, and day by day regulatory bodies are building stricter anti-money laundering (AML) regulatory frameworks.

As the digitalisation of money speeds up, and the use of cryptocurrencies becomes broader, the inherent nature of anonymity and speed of virtual asset transactions is becoming more concerned against AML/CFT prevention.

The Central Bank of the UAE (CBUAE) recently published new regulations and standards for Virtual Assets Service Providers (VASPs) and other financial institutions for AML, consumer protection and data security. The United Arab Emirates (UAE) has become a leading

force in the global fight against financial crime. As a thriving financial centre in the Middle East, the UAE acknowledges the importance of maintaining a robust anti-money laundering (AML) and countering the financing of terrorism (CFT) framework The Central Bank of the UAE (CBUAE) constantly publishing new regulations and standards for the banking sector, Virtual Assets Service Providers (VASPs) and other financial institutions for AML, consumer protection and data security.

Again, as the digitalisation of money speeds up, and the use of crypto currencies becomes wider, the inherent nature of anonymity and speed of virtual asset transactions is coming, the regulatory pressure on VASPs from the Central Bank continues.

Can you tell us what the fraud trends are in 2023 and beyond?

In our ever-expanding digital landscape, where technology continues to strive its

of synthetic identities, the exploitation of biometric data and the persistence of insider fraud. Collectively, these trends pose a serious threat to the integrity of the financial industry.

In this enduring battle against fraud, financial institutions are called upon to implement binding and effective Know Your Customer (KYC) processes, fortified with cutting-edge technological solutions.

These measures stand as the most potent weapons in the ongoing fight against fraud, helping safeguard the financial ecosystem from the ever-evolving tactics of perpetrators.

Please tell us about Fineksus’ plans in the region for the coming years.

We expect that AI and Machine Learning in regulation technology will become even more significant in the upcoming years, driven by the ongoing surge in digitalisation. Financial institutions are struggling with the task of handling

THIS RAPID SHIFT CREATED VULNERABILITIES THAT CRIMINALS HAVE BEEN QUICK TO EXPLOIT AND ADOPT influence on our daily lives, the realm of fraud has not stayed behind; instead, it has adapted to the latest advancements.

As we step into 2023, marked by numerous developments in the financial services sector, considerable fraud trends have also emerged concurrently. These trends pose a formidable challenge to individuals, businesses and authorities alike, necessitating an alert and proactive stance in the ongoing battle against fraudulent activities.

Among the notable fraud trends of 2023, we see the spread of unsafe new digital payment methods, the ascendance of cryptocurrencies, the rise

huge transaction volumes, which has led to a rising demand for automated AML solutions. At Fineksus, we are dedicated to making substantial investments in AI and Machine Learning to assist our clients in navigating this ever-changing environment.

We are also looking other ways of using AI for our Financial Messaging platform, as the region is becoming more sophisticated financial hub, the importance of supporting multiple payment channels is curial and orchestration of these channels will become more critical than ever, we are exploring to use AI in that area as well. mea-finance.com

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COVER INTERVIEW

Pursuit of Excellence In his interview with MEA Finance Vipul Kapur Head of Mashreq Private Banking, examines key trends and opportunities in wealth management industry in the region, underlining how Mashreq is at the forefront of the digital innovation that plays a pivotal role in shaping exceptional client experience

Vipul Kapur, Head of Mashreq Private Banking

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Banking and Finance news in the MEA market

W

hat is your current assessment of the private banking and wealth management market in the region and what are the key trends you have seen emerge in the recent past?

The private banking and wealth management market in the Middle East is booming, largely due to the massive amount of wealth being generated within the region. A significant amount of global wealth is also being drawn to the UAE and being invested in expansion of the country’s infrastructure, driven by visionary government policies and regulations. It also stands out in terms of lifestyle, maintaining its position as one of the world’s most desirable and secure places to reside. Other countries in this region are also aggressively diversifying their economies, thereby bolstering the region’s GDP and creating promising prospects for the underlying wealth management industry. With innovative tourism campaigns, large investments in various sectors, and several countries being prepped for their potential role as financial hubs, the region is leveraging its strengths to cater to the needs of wider population of middle east. All these developments bode extremely well for the private banking and wealth management sector.

In this evolving scenario, we are naturally witnessing a robust growth in private wealth and an increasing focus on professional wealth management services as a number of wealthy and ultra-rich individuals have made their way to the region and demand worldclass service standards. There are an estimated 83,000 HNWIs residing in the UAE at present, each with a net worth of at least USD 1 million. In 2023 the number of millionaires migrating to the UAE increased by approximately 4500

with a further increase expected over the next 5 years. This means that the private banking sector in the region is poised for further expansion as more and more affluent families discover all that the country has to offer Amongst key trends, we are observing that many global private banks and wealth management players are focusing on establishing their base in the region. This will further drive the growth of private banking. There is also an increased focus on experiential banking, digital finance and hyper-personalised services, as the clients become more demanding of their banking requirements and preferences.

What distinguishes Mashreq Private Banking from other providers in the market?

We are in a unique position to offer clients the full suite of banking services as well as the entire range of regional and global wealth management products and solutions. This means that Mashreq Private Banking is a regional powerhouse providing a “one stop shop” for all banking and wealth management requirements.

We offer the entire range of products and services, whether it be premium credit cards, bespoke lending & financing or corporate banking solutions. We are able to offer services catering to daily banking requirements as well as dedicated wealth management and family office services.

Our wealth management proposition offers a wide range of products including local and global equities, fixed income solutions, regional IPOs, structured products, model portfolios, mutual funds and certificates of deposit (CDs) which are both conventional as well as shariah compliant.

I f I we re to m e nt i o n o u r key distinguishing feature, it would be the diverse wealth management platform, which unlocks a unique set of regional and global investment solutions for our clients. It caters to all potential requirements across products and asset classes. We specialise in regional wealth management solutions that many of

ULTIMATELY, THE SUCCESS OF INTEGRATING THE PERSONAL APPROACH WITH TECHNOLOGY HINGES ON CLIENT PREFERENCES AND THE CAPACITY TO ADAPT our competitors cannot and we lead the industry in both digital innovation and bespoke product structuring to suit the needs of our sophisticated high net worth clients. This advantage of bringing regional expertise and global opportunities to our clients has helped position us as a true leader at the forefront of the industry.

How does Mashreq meeting the need to provide fulfilling client experiences?

At Mashreq, we firmly believe that our success is inextricably tied to the success of our clients. Our relationship managers understand this and work relentlessly to help clients achieve their financial objectives. Their passion, dedication, expertise and unwavering commitment to putting clients first make them true assets to our organisation and, more importantly, to our valued clients.

Trust is the bedrock of any successful c l i e n t- a d v i s o r re l a t i o n s h i p. O u r relationship managers understand that trust is earned through transparency and consistency. They provide clients with timely and factual communication, so that clients have the information available to make well-informed and rational decisions.

As a testament to our unwavering commitment to enhancing customers’ wealth creation journeys through personalised service, wide range of solutions and technology innovation, Mashreq Private Banking has been named the Best Private Bank by several prestigious awarding agencies including Financial Times, Global Private Banking Innovation awards and Global Private Banking Awards, to name a few.

I s t h e p e rs o n a l a p p ro a c h essential in relationship management for affluent clients or do you see deployment of te c h n o l o g y re p l a c i n g t h i s concept in the near future?

Both elements have their merits, in fact technology is an enabler of relationship management. While the personal approach is fundamental in building trust and rapport with highnet-worth clients, and human advisors can empathise, understand nuanced financial goals and offer customised solutions, technology helps with data analysis and providing superior service, effectively and quickly. It enables data processing, ensuring accuracy and speed in portfolio management.

Relationship managers and specialists use these tools to streamline routine tasks, gather data-driven insights, and suggest informed strategies, thus freeing up time that can be spent on personalised client interactions that involve financial discussions, goal setting, and addressing complex, unique needs.

Ultimately, the success of integrating the personal approach with technology hinges on client preferences and the capacity to adapt. Some clients may prefer the traditional human touch, while others embrace technology for its convenience.

Therefore, we are flexible and offer a range of options to cater to varying client needs. The key is not to view technology as a replacement but as a facilitator that augments the capabilities of human advisors in relationship management.

With digital technology at their fingertips, the way our clients interact with us has evolved tremendously. mea-finance.com

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COVER INTERVIEW

Our online and mobile banking apps, wealth journeys and investment platforms offer seamless access to information, portfolio performance and financial planning tools. This helps clients monitor their investments in real-time, execute transactions, and communicate with their relationship managers and advisors at their convenience. This digital transformation has significantly elevated client experience.

How has Mashreq Private Banking invested in technology and what is your stance on digital innovation?

We are a technology company with banking in our DNA. Technology is embedded in and at the forefront of all our client offerings. We truly believe that technology gives us the ability to enhance client experience, provide actionable information and a platform where client can take informed decisions supported by their relationship managers and specialists.

We have pioneered what we call the “hybrid model in wealth management.” It is a 3-way model which helps our clients engage seamlessly with our relationship managers and our state-of-the-art digital platform to get actionable information and execution capabilities at their fingertips Combining human expertise with technology is only gaining traction in the wealth management industry more recently, but we started investing in it some years ago. We have in-house digital wealth squads (technology development teams) which are embedded directly within the business and work very closely with relationship and proposition teams to understand client requirements and develop world class client journeys to equip both relationship managers and clients.

Clients receive personalised attention from advisors while benefiting from the efficiency and cost-effectiveness of technology. Hybrid models also provide scalable solutions, making quality financial advice accessible to a broader client base.

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We embarked on a journey of digitising our wealth solutions and I take pride in saying that Mashreq Private Banking now has a robust team of over 20 digital experts including Product specialists, frontend, backend and quality assurance engineers and UI & UX designers, rolling out innovative wealth digital capabilities.

Mashreq has always been at the cutting edge of technology and an undisputed leader in innovation in the country. In keeping with our unwavering pursuit of customer satisfaction, we are currently leveraging technology backed solutions to continuously enhance our already massive financial analysis and service delivery portfolio. These solutions allow us to deliver exceptional experiences to our customers.

How is Mashreq approaching the growing importance of succession planning?

According to a recent survey, it was found that among well-established HNWIs, less than 25% have completed a comprehensive succession plan for their personal assets. Approximately 30% have a plan, but it covers only a portion of their assets. Nearly as many have yet to establish a succession plan, despite their expressed interest in doing so.

Banking and Finance news in the MEA market

Wealth transfer and succession planning form the cornerstone of sound financial management, ensuring that hard-earned assets are preserved, protected and passed on to the next generation according to ones wishes.

With growing wealth, the complexity of clients’ financial requirements also increases, thereby prompting the need for professional wealth management solutions, like the ones provided by Mashreq Private Banking.

The Family office arm within Mashreq Private Banking is a meticulously managed investment team, led by seasoned professionals who are equipped with the expertise to manage these sophisticated requirements.

We recognise that these are not only bespoke but also highly critical. We are privy to confidential financial and family information that is typically known only to our clients and us. We serve as custodians of information and are obliged to protect this knowledge and work with the family patriarchs to design solutions that will serve their immediate and future wealth management and protection needs.

In terms of expertise, succession planning requires personalised services that extend beyond the ordinary, encompassing investment management, estate planning, tax planning, philanthropic planning and risk management. It involves ensuring the seamless transfer of assets and management responsibilities across generations to guarantee the continuity of wealth. Our teams along with in-house and third-party specialists are fully equipped to cater to this growing segment.

Beyond succession, what other two matters would you say are top of mind for your HNW clients at this time?

We have seen growing interest towards solutions which can help preserve and grow wealth for the benefit of future generations. Clients understand the importance of long-term financial security and are actively seeking ways to ensure

their assets continue to appreciate, including prudent investment strategies, diversification across asset classes and exploring alternative investment options to generate returns beyond their traditional business earnings.

UHNWIs are keenly aware of the need to differentiate their corporate strategies from personal income, making wealth preservation and growth a top priority.

Besides this, we have seen that many affluent families are increasingly committed to fulfilling their social responsibilities and engaging in philanthropic endeavors. They aspire to leverage their wealth to create a positive impact on society, addressing pressing issues related to areas such as education, healthcare, poverty alleviation and environmental conser vation.

However, balancing philanthropic goals with financial objectives can be a complex challenge for clients who want to make a meaningful difference while ensuring their philanthropic efforts align with their broader financial and estate planning goals. Accordingly, they are keen on seeking guidance around structuring charitable initiatives, setting up foundations and maximising the impact of their altruistic contributions. Social responsibility is not just a moral imperative but also a strategic consideration for a number of these clients.

To site an example, we recently assisted one of our clients in organising the transition of leadership within their family business. In this case, the family patriarch entrusted the daily management of the business to the next generation.

The primary objective was to free up additional time for him to establish and support his charitable foundations, as well as to devote more effort to his passion for educating underprivileged children.

Philanthropy and charitable donations by individuals and families in the region is estimated at $210 billion and expected to grow, based on a recent report. The expansion of more focused philanthropic investments is influenced by shifts in society, including changes in generations within the

family businesses that hold a prominent position in the region’s private sector.

Finally, another important aspect at the top of the mind of our HNW clients is governance and risk management, given the complex interplay between family dynamics, investment choices and business interests. They recognise that without effective governance, family wealth can be at risk. Establishing clear rules, responsibilities and decisionmaking processes within the family and across their various financial ventures is essential. Moreover, compliance with regulations and risk management strategies is paramount, as families need to adhere to tax laws and financial regulations, to preserve their wealth.

With increasing growth and competition in regional wealth management hubs, how does Mashreq ensure it can source and retain the skilled bankers and relationship managers?

At M a s h re q , we re c o g n i s e t h a t sourcing and retaining skilled bankers and relationship managers is crucial for success in the competitive wealth management landscape of the Middle East. We employ multi-faceted approach to attracting and retaining skilled professionals from UAE as well as our Global network locations.

Internal talent development: We cultivate our internal talent pool by identifying promising candidates and providing them with a platform to gain experience and expertise.

This not only creates a pipeline of talent but also fosters a sense of l oya l t y a n d c o m m i t m e nt among employees.

Performance-driven advancement: Promoting top-performing advisors to the Private Banking division serves as a strong incentive for talent retention, as it not only rewards high achievers but also encourages others to strive for excellence, creating a competitive yet collaborative work environment.

L ong-term commitment: Our Relationship Management team boasts an impressive average tenure, indicating our success in talent retention. This long-term commitment not only helps preserve institutional knowledge but also enhances client relationships, as experienced bankers often have a deeper understanding of their clients’ needs.

Collaboration with international training institutes: Our ongoing collaboration with international training institutes underscores our commitment to continuous professional development. By investing in training and skill enhancement, we equip our bankers and relationship managers with the latest industry knowledge and best practices.

R egulatory support: Enabling initiatives of regulatory bodies aimed at fostering local expertise are providing an additional boost for us. Regulatory backing can include incentives, certifications and professional development p ro g ra m s t h a t e n c o u ra g e individuals to pursue careers in private banking and wealth management, and this is imperative for the growth and maturing of the entire industry.

F ocused recruitment: While external recruitment remains challenging, we continue to seek skilled professionals to complement our internal talent pool. Our attractive platform for development and growth opportunities acts as a compelling factor for external candidates looking to join a dynamic and reputable institution.

Our comprehensive talent acquisition and management strategy not only addresses the talent scarcity issue in the Middle East but also positions us as a preferred employer in the region’s wealth management industry, ensuring our continued growth and success. mea-finance.com

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AVIATION FINANCE

Patches of Turbulence The regional aviation business is performing with strength, but despite the post-pandemic turnaround, higher interest rates, fears of recession and geo-political challenges are leading businesses to seek other funding sources

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he global aviation market has fully reopened and air traffic is powering ahead of 2019 levels in many markets, as pentup demand for air travel is sustaining bookings. The International Air Transport Association (IATA) projected that global industry profits will reach $9.8 billion in 2023, more than double the $4.7 billion forecasted last December.

“Economic uncertainties have not dampened the desire to travel, even as

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ticket prices absorbed elevated fuel costs,” Willie Walsh, the Director General of the global aviation trade body said in June, adding that after a sharp deep following the outbreak of the pandemic, a net profit margin of 1.2% is something to celebrate!

However, despite the sector’s postCOVID turnaround several factors risk derailing IATA’s expectations. These include soaring interest rates to tame inflation, the war in Ukraine, lingering supply chain issues and fears of a recession.

Banking and Finance news in the MEA market

The current operating environment makes it challenging for the key stakeholders in the aviation sector to forecast and plan.

PwC said lessors, lenders, investors and rating agencies will need to look beyond the near term to ensure that sufficient and affordable liquidity is available for deployment as the global aviation sector is set to take delivery of new aircraft worth more than $100 billion in 2023.

With consumers continuing to prioritise spending on air travel, new passenger airlines continuing to be established and record-breaking aircraft orders, the positive momentum behind the recovery is showing no signs of slowing.

Climbing higher in the industry The GCC has acquired extensive aviation credentials over the past three decades.

The aviation industry in the region saw a

huge turnaround in passenger traffic and consequently big order books.

“The region is leading the recovery with May traffic at 17.2% above 2019 levels,” according to IATA. The aviation industry’s main lobby body said Middle Eastern airlines witnessed a 30.8% increase in traffic in May compared to the same period a year ago while capacity rose by 25%.

GCC airlines reported significant profits for the fiscal year 2022/23, boosted by strong demand for leisure travel. Dubai’s Emirates Group reported an annual profit of $3 billion (AED 10.9 billion) for the year ending April 2023 and the aviation behemoth invested AED 7.2 billion in new aircraft, facilities and equipment.

Qatar Airways’ annual revenues soared to $21 billion (QAR 76.3 billion), crediting its strong performance to December’s FIFA World Cup while its net profit stood at QAR 4.4 billion. As well as being home to some of the world’s best airlines – Emirates, Qatar Airways, Etihad and Saudia – the Gulf region is home to three leading budget carriers, Air Arabia, flydubai and flynas.

The low-cost airlines also posted record profits, driven by aggressive expansion of routes and fleet. Sharjahbased Air Arabia posted AED 801 million in half-year net profit while its revenues exceeded AED 2.8 billion. flydubai, Dubai’s low-cost carrier, reported an annual net profit of AED 1.2 billion and its revenues soared by 72% to AED 9.1 billion.

The region also offers globally renowned and expanding airports and supports a broad range of ancillary sectors that comprise the broader aviation industry.

Last November, Saudi Arabia unveiled plans to transform Riyadh Airport into a massive aviation hub capable of eventually handling 185 million passengers and processing 3.5 million tonnes of cargo a year. The King Salman International Airport will cover an area of about 57 km with six parallel runways.

Meanwhile, Abu Dhabi is set to open a state-of-the-art new terminal at its

ECONOMIC UNCERTAINTIES HAVE NOT DAMPENED THE DESIRE TO TRAVEL, EVEN AS TICKET PRICES ABSORBED ELEVATED FUEL COSTS. AFTER A SHARP DEEP FOLLOWING THE OUTBREAK OF THE PANDEMIC, A NET PROFIT MARGIN OF 1.2% IS SOMETHING TO CELEBRATE – Willie Walsh

international airport in November.

Known as Midfield Terminal Building during the construction phase, the $3 billion Terminal A, can handle 45 million passengers per year and process 11,000 passengers per hour.

T h e w o r l d ’s b i g g e s t a i rc ra f t manufacturers – Airbus, Boeing and Embraer – have publicly identified the Middle East to be one of their primary customer targets and predict nearly doubling of the demands in both single aisle and wide-bodied assets.

AS MOST AIRLINES’ REVENUE STREAMS ARE NOW BACK ON TRACK, DELINQUENCY LEVELS FOR THE REVISED LEASE OBLIGATIONS HAVE BEEN LOW THROUGH THE YEAR AND LESSORS’ PROFITABILITY HAS BEEN LARGELY RESTORED – PwC

The age of resilience Globally, the post-pandemic era has witnessed an increase in the number of aircraft leasing companies as new entrants pounce on the opportunity to meet airlines’ demands for new fleet additions.

While there were plenty of new entrants, such as Griffin Global Asset Management, SKY Leasing, and Sirius Aviation Capital, Saudi Arabia’s AviLease has shown the fastest and most significant growth.

The Public Investment Fund-owned jet lessor agreed to acquire Standard Chartered’s aviation finance business for $3.6 billion in August. AviLease bought a portfolio of 100 narrowbody aircraft and became a servicer for another 22 jets.

The deal is part of a push by Saudi Arabia to become a global trade, logistics and tourism hub, and help diversify its economy away from heavy reliance on oil revenues. The kingdom unveiled a new national airline, Riyadh Air, in March.

The carrier, which is set to the skies by 2025, plans to acquire more planes following the purchase of 39 Boeing 787-9 widebody jets in March, with options for 33 more.

M e a n w h i l e, D u b a i Ae ro s p a c e Enterprise signed a multi-tranche finance deal for $1.6bn with 26 lenders in September, the largest loan amount raised by the aircraft leasing firm to date.

The UAE aircraft leasing firm agreed to acquire a total of 64 Boeing 737 MAX aircraft in August. The acquired portfolio, mea-finance.com

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AVIATION FINANCE

which includes Boeing 737 MAX 8s, 737 MAX 9s, and 737 MAX 10 aircraft, is scheduled to be delivered between 2023 and 2026.

Founded in 1985, DAE serves more than 170 airline customers in over 65 countries, and the group’s leasing division manages a fleet of about 425 Airbus, ATR, and Boeing aircraft – with a value exceeding $17 billion.

Aircraft leasing rates are expected to surge, with many lessors already indicating an uptick, but it will take some time for them to catch up with rising interest rates to return to that equilibrium with the debt markets.

KPMG said over the past 18 months the rising rate environment increased the cost of debt became unattractive and many companies pivoted back to commercial banks and private equit y firms for access to more efficient capital.

US Federal Reserve (Fed) Chairman Jerome Powell said in late August that inflation remained too high and central bankers were prepared to tighten more if necessary. A hawkish monetary policy by the US Fed has taken the benchmark overnight interest rate from the near-zero level in March 2022 to its current 5.25%5.50% range.

While rates are higher now than at any time since the global financial crash of 2008, they are not out of kilter with longerterm historical norms.

The aviation finance market is adapting, but it will take time. The natural upward movement of lease rate factors is taking place, but as has been the case in the past, there is a lag in the correlation with the rising rate environment.

Fasten your seatbelts T h e a i rc ra f t l e a s i n g i n d u s t r y demonstrated its incredible resilience last year by seeming to shrug off the worst disaster in its history when the sanctions that were imposed on Russia following the outbreak of the war in Ukraine effectively trapped 550 aircraft in the country.

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The Russian market is relatively small in terms of global air traffic, but it did have an overweight proportion of leased aircraft. KPMG said the publicised impairments relating to the loss of the Russian leased fleet add up to more than $7 billion.

UAE aircraft leasing firm DAE said there was an asset write-off of $538 million related to its aircraft stuck in Russia after Moscow enacted a law in March 2022, allowing the country’s airlines to seize leased planes to fly them domestically.

carrier Go First was granted bankruptcy protection in May. Despite the devastating impact of another global shock event, many larger lessors have been able to cope with the loss, at least for now. Industry analysts expect two-thirds of new passenger aircraft deliveries to be financed by lessors as global traffic is now projected to be at 95.6% of pre-COVID levels.

“As most airlines’ revenue streams are now back on track, delinquency levels for the revised lease obligations have been low through the year and lessors’

INTERNATIONAL TRAFFIC CLIMBED 29.6% IN JULY COMPARED TO THE SAME MONTH A YEAR AGO WITH ALL MARKETS SHOWING ROBUST GROWTH AND INTERNATIONAL REVENUE PASSENGER KILOMETRES REACHED 88.7% OF JULY 2019 LEVELS – International Air Transport Association

Irish lessor Avolon Holdings recorded an impairment of $304 million from its exposure to Russia. Many lessors have active legal claims against insurance companies, which are refusing to pay out because recovery of the aircraft may still be possible, but such large-scale litigation action is expected to take several years to resolve.

The global aviation finance and leasing industry has been in the middle of unprecedented market conditions for almost three years now. Aircraft leasing companies including DAE Capital, ACG Aircraft Leasing, SMBC Aviation Capital Aviation and BOC Aviation have been engaged in a legal tussle to repossess their aircraft after the Indian budget

Banking and Finance news in the MEA market

profitability has been largely restored,” said PwC. IATA said international traffic climbed 29.6% in July compared to the same month a year ago with all markets showing robust growth and international revenue passenger kilometres (RPKs) reached 88.7% of July 2019 levels.

Future increases in aircraft financing will be determined by air travel recovery as well as the efficiency and environmental performance of aircraft fleets. With the current total leased fleet amounting to roughly half of the global fleet, aircraft lessors are expected to continue playing an increasingly significant role in the growth of the aviation sector.

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AVIATION FINANCE

Cleared for Take Off Vijay Valecha Chief Investment Officer, Century Financial gives his overview of Aviation Finance and its resilience in the face of multiple challenges, detailing the vital role it plays in the global financial landscape, how the sector is now changing and primed for growth in the GCC

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as aviation finance activity in the region returned to prepandemic levels?

As 2023 unfolded, the aviation industry showed signs of recovery. Travel restrictions eased, particularly in China, signalling further economic revival.

Despite the turbulence caused by the COVID-19 pandemic and rising crude oil prices, airlines invested in fuel-efficient aircraft to manage cost pressures.

Global passenger traffic rebounded significantly, approaching pre-pandemic levels. Initially, international travel lagged behind domestic travel due to ongoing restrictions.

However, as vaccination efforts progressed and policies eased, international passenger flows improved, especially in the Asia-Pacific region. By Q1 2023, total revenue passenger kilometres (RPKs) reached 88.0% of 2019 levels, driven by recoveries in both domestic and international travel.

Notably, the aviation industr y displayed resilience and adaptability, with domestic traffic rebounding swiftly

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Vijay Valecha, Chief Investment Officer, Century Financial

in regions like Europe, Latin America and the Middle East, surpassing 2019 levels.

Asia-Pacific airlines excelled, achieving 98.9% of 2019 domestic RPKs by March 2023.

Sub Head - A Road to Recovery The GCC region is home to some of the world’s fastest-growing airlines and has a strong track record of investing in aviation infrastructure. Despite the challenges posed by the COVID-19 pandemic, the ongoing conflict in Ukraine and the rising cost of capital, the long-term outlook for the GCC aviation finance market remains positive.

Banking and Finance news in the MEA market

The GCC region is poised to leverage the anticipated expansion of the global aviation sector, benefiting from its strategic location at the intersection of Europe, Asia, and Africa, positioning it as a pivotal hub for international air travel. Additionally, the region enjoys favourable economic conditions, with strong economic growth projected in the foreseeable future, providing a solid foundation for the aviation industry’s development.

Furthermore, GCC governments are actively fostering this growth through substantial investments in airport infrastructure and the implementation of various initiatives designed to attract both airlines and aviation finance entities to the region, further solidifying its status as an aviation powerhouse.

In 2022, the total value of aviation finance transactions in the GCC amounted to $10.2 billion, down from $15.2 billion in 2019, the last full year before the pandemic. Additionally, the number of aviation finance transactions in the GCC declined from 81 in 2019 to 52 in 2022.

Several factors contributed to this decline, including the earlier mentioned impacts of the global pandemic, the conflict in Ukraine and increasing cost of capital.

Despite these challenges, the longterm outlook for the GCC aviation finance market remains positive. Projections suggest that the value of aviation finance deals in the GCC will reach $15.7 billion by 2025. This optimism is grounded in the GCC region’s status as a home to rapidly expanding airlines and its expected robust economic growth in the coming years.

The GCC region is also taking steps to address the challenges facing the

aviation finance industry. For example, the region is investing in digitisation and technology and a sustainable future.

Are digitisation and technology easing the administrative burden of the managing of multiple funding structures?

The aviation finance sector is undergoing a technological revolution through digitisation, substantially alleviating the administrative complexities tied to managing multiple funding structures.

This transformation is exemplified by several innovative tools and approaches.

Document Management Systems, for instance, streamline the gathering, storage and retrieval of documents associated with various funding structures, leading to time savings, error reduction and enhanced efficiency.

Workflow Automation tools take on tasks such as data entry, approval routing and reporting, allowing personnel to concentrate on strategic endeavours.

Furthermore, data analytics tools offer valuable insights into the performance of

associated risks. Overall, digitisation and technology simplify operations, enhance efficiency and elevate transparency in aviation finance, ushering in a new era of streamlined financial management.

Does Avilease’s acquisition of Standard Chartered aircraft leasing business signal anything prophetic about the role of banks in aviation finance?

The recent acquisition of Standard Chartered’s aircraft leasing division by AviLease, a Saudi-owned entity, indicates a significant development that could reshape the role of banks within aviation finance. Historically, banks have been dominant players in this field, but the emergence of newcomers like AviLease suggests a more competitive and diversified landscape.

Several factors are driving this evolving trend. Firstly, the global aviation industry is gearing up for significant expansion, resulting in a heightened demand for financing. This surge in growth creates a window of opportunity for newcomers

LOOKING AHEAD, THE FUTURE OF AVIATION FINANCE IN THE GCC APPEARS PROMISING a range of funding structures, facilitating more informed resource allocation and risk management decisions. Together, these advancements signify a new era of streamlined financial management in aviation finance.

Examples of digitisation and technology tools in aviation finance include loan origination software for automating loan processes, portfolio management software for tracking performance and risk management software for identifying and assessing risks. While these advancements offer cost savings and benefits, it’s crucial to implement the right solutions, provide staff training and maintain robust risk management frameworks to mitigate

like AviLease to disrupt established banking institutions. Secondly, there’s a growing emphasis on sustainability within the aviation finance sector. Banks are encountering mounting pressure to diminish their reliance on fossil fuels, which in turn, is paving the way for nonbank lenders such as pension funds and sovereign wealth funds to actively participate in aviation financing, aligning with more environmentally conscious investment practices.

Banks are expected to maintain their relevance but adapt to shifting market dynamics and the integration of new technologies. Anticipated transformations in the role of banks in aviation finance

include specialised focuses, collaborative ventures with non-bank lenders and technological integration.

Are banks and aviation finance specialists taking steps to i n c o r p o ra te s u sta i n a b i l i t y and climate change into their funding structures?

Banks and aviation finance specialists are increasingly incorporating sustainability and climate change considerations into their financing mechanisms. Initiatives include the development of climatealigned finance frameworks, exploration of blended financing structures, financing for sustainable aviation fuels (SAFs), and support for airlines’ sustainability initiatives. Sustainability integration offers advantages such as risk mitigation, enhanced investment prospects, and improved reputation.

How does the near future for aviation finance in the GCC look?

Looking ahead, the future of aviation finance in the GCC appears promising.

Projections indicate that by 2025, the GCC aviation finance market is set to reach a valuation of $15 billion. This growth is underpinned by the expected expansion of the GCC aviation sector, driven by robust economic development, population growth, and substantial investments in airport infrastructure.

While banks currently dominate the sector, the entry of non-bank lenders and growing interest in sustainable aviation finance signal a dynamic and competitive market. Recent successes, such as Dubai Aerospace Enterprise’s (DAE) significant financing deal, illustrate the confidence banks have in the region’s aviation finance potential.

In conclusion, aviation finance in the GCC is poised for growth and transformation. Digitisation, technology, sustainability and changing roles of banks are shaping the landscape, offering opportunities for investors, lenders and industry stakeholders to navigate the skies of this dynamic sector. mea-finance.com

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ORACLE ROUNDTABLE EVENT

Corporate and Transaction Banking in the Era of the Cloud Cloud adoption is increasingly at the core of digital innovation, with the migration of corporate and transaction banking on to it shaping the future of Saudi Arabia’s financial services sector

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igitalisation in the banking sector is not a new phenomenon, but the focus has shifted to accelerating the pace of transformation, whilst keeping laser-focused on delivering benefits – not only in profitability for the banks but also in customer experience.

Banks that successfully transform digitally move their operations, data and workloads to the cloud, often employing sandbox platforms (isolated testing environments) in the process.

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Cloud adoption is the backbone of digital innovation, and it is shaping the future of the financial services sector.

When technology layers such as customer and frontline engagement, integration and APIs, data and analytics, security and infrastructure are moved to or built on the cloud, new technology and application development is faster, more reliable and more easily scalable.

Banks in Saudi Arabia are investing billions of dollars in next-generation technologies to develop modular, cloud-

Banking and Finance news in the MEA market

based systems and the spotlight has turned to automating and improving core processes.

By adopting the cloud to make their systems accessible from multiple locations, financial institutions in Saudi Arabia are launching new, improved digital products while streamlining their operations.

MEA Finance in partnership with Oracle Financial Services hosted an exclusive roundtable themed Corporate and Transaction Banking in the era of Cloud computing in Riyadh, Saudi Arabia.

The roundtable, which was attended by senior representatives from across the kingdom’s financial service sector, spotlighted how the adoption of cloud technology in corporate and transaction banking is revolutionising the way financial institutions deliver their services and products.

To thrive in the changing operating environment, industry experts say

corporate banks should concentrate on improving customer experience and deploying the latest technology and processes to enhance their services.

Oracle Financial Services, a majorityowned subsidiary of Oracle, provides retail and corporate banks with a secure cloud platform while bringing automation to manage legacy applications and easily scale services according to customers and local market demands.

IBM said cloud technologies make it easier for corporate banks to provide a consolidated multi-country, multicurrency, multi-banking relationship view of accounts. Banks are leveraging cloud technology to unlock new ways to get closer to their customers as digitalisation is reshaping the financial services sector.

Market update: Transaction banking & payments Powerful trends are transforming payments and transaction banking in Saudi Arabia, an economy that was once heavily dependent on cash. Cash is no longer king in the Gulf state as digital payments are increasingly becoming the preferred mode of settling payments in the country.

“Oracle provides components, customised, innovative, end-to-end banking solutions that offer greater efficiency, deployment flexibility and an enhanced user experience,” said Houssam Chaker, Head of Sales – Middle East at Oracle Financial Services.

Traditionally, bank-provided treasury platforms have focused on core transaction execution central to their corporate relationships. However, software-as-a-service (SaaS) solutions

and API connectivity have made robust, multifunctional workstations far more feasible.

Parag Ekbote, Head of Business Development Corporate Banking APJ & MEA at Oracle Financial Services said while there is so much disruption going on in the infrastructure and cloud space, the technology is chiefly being leveraged by new entrants in the financial services sector.

government are quickly catching on to the wave of digitisation to meet clients’ digital demands. Ekbote highlighted that the new paradigm is replacing the traditional model in which banks oversaw the entire lifecycle, from manufacturing the product to its distribution and ensuring its servicing.

Oracle is fostering the growth of the new paradigm by delivering the most comprehensive offering of cloud-native

“ORACLE PROVIDES COMPONENTS, CUSTOMISED, INNOVATIVE, END-TO-END BANKING SOLUTIONS THAT OFFER GREATER EFFICIENCY, DEPLOYMENT FLEXIBILITY AND AN ENHANCED USER EXPERIENCE – Houssam Chaker

Software companies and other thirdparty solution providers have grasped this opportunity to create solutions that are gaining ground with corporate clients of all sizes across an array of sectors.

Ekbote said global e-commerce companies such as Amazon and Alibaba are inarguably disrupting a big part of the retail and consumer side. However, these marketplaces are also disrupting corporate and transaction banking by extending finance and payment services to merchants who use their platforms, he added.

Large corporates and businesses operating in Saudi Arabia as well as the

SaaS solutions such as embedded finance or banking as a service (BaaS).

“Traditional banks provide a balance sheet, Know Your Customer (KYC) and regulation around it. By leveraging innovative tools such as software and data enablers, banks technically ensure that the technology available at their disposal such as machine learning and AI are bringing to the market products that are a combination of the financial product coupled with the technical product,” said Ekbote.

Oracle is assessing how incumbents can collaborate with platforms and participate in ecosystems - embedded

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ORACLE ROUNDTABLE EVENT

finance – and this is the way “we envisage the corporate and transaction bank of the future”.

From a corporate banking perspective, the software and cloud firm provides corporate applications that allow a bank’s customers using Oracle Enterprise Resource Planning (ERP) to control the pace and define areas of business that can be addressed first, such as modernising financials, supporting company-wide planning or improve corporate-wide efficiency.

“The corporate and the transaction bank should offer services as a transaction bank, ensure payments are central to all services offered by the bank, digitalise trade and finance the supply chain and foster sustainability while ensuring that transaction banking is a pillar of your strategy,” Ekbote explained.

Ekbote stressed that corporates, both small to medium enterprises and multinational companies, are clamouring for simplification. “They’re asking banks to simplify their entire account structures,” he said.

On the payments front, Ekbote said the sector is buzzy with activity be it reconciliation or new innovative technologies. However, the million-dollar question is whether these developments reach the corporate.

“When banks decide to augment corporate and transaction banking, they should consider whether the move is a steppingstone towards embarking on a payment digitisation journey,” said Ekbote.

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A study by the Saudi Central Bank (SAMA) stated that electronic transactions surged in 2021 to 57% from 36% in 2019 while in terms of volume, the percentage of digital payments increased to 62% in all the sectors in 2021.

Cloud banking in Saudi Arabia S a u d i A ra b i a ’s b a n k i n g s e c to r experienced a landmark year in the first half of the year. The financial services sector is the lynchpin of Vision 2030, Crown Prince Mohammed bin Salman Al Saud’s economic blueprint to drive growth across non-oil sectors.

Fahad Alturief, Vice President – Cloud, Saudi Arabia, Levant & North Africa Markets at Oracle Financial Services opened his presentation by shedding light on Oracle’s cloud footprint in the kingdom - in Riyadh, Jeddah and Neom.

Since opening its first cloud region in Jeddah, Alturief said the software company is noticing an increasing adoption of Oracle Cloud Service in Saudi Arabia.

“The launch of the Jeddah cloud region and the restrictions that were imposed to mitigate the spread of COVID-19 served as a de facto catalyst for cloud adoption globally across diverse industries in Saudi Arabia, due to several reasons including quick time to market and innovation,” he said.

Alturief said Oracle unveiled plans to invest $1.5 billion in Saudi Arabia in the coming years as the company builds up its cloud footprint in the kingdom and expands beyond the Jeddah cloud region. “We are expanding our footprint in partnership with stc Group’s subsidiary center3, we are building NEOM cloud region and a new one

“THE CORPORATE AND TRANSACTION BANK SHOULD OFFER SERVICES AS A TRANSACTION BANK, ENSURE PAYMENTS ARE CENTRAL TO ALL SERVICES OFFERED BY THE BANK, DIGITALISE TRADE AND FINANCE THE SUPPLY CHAIN AND FOSTER SUSTAINABILITY WHILE ENSURING THAT TRANSACTION BANKING IS A PILLAR OF YOUR STRATEGY – Parag Ekbote

Banking and Finance news in the MEA market

in Riyadh, and all four data regions should be operational by mid-2024,” added Alturief.

The kingdom prioritised the transformation of its banking sector when it established the Financial Sector Development Programme in 2018. Over the years, regulators have introduced a series of initiatives - including the adoption of Open banking - to achieve greater economic development.

Oracle’s cloud regions in Saudi Arabia offer all the services ranging from Platform as a service (PaaS) to SaaS to Infrastructure as a service (IaaS), and the company counts financial giants Alrajhi Bank, Saudi Awwal Bank and Banque Saudi Fransi among its customers.

Alturief also said that Oracle is collaborating with several vendors such as Microsoft. Oracle and Microsoft announced a deeper interoperability of their clouds in July 2022, allowing customers to easily run projects across the two platforms.

Cloud technology is a key enabler in advancing open banking, a key innovation that will allow Saudi Arabia’s banking industry to deliver best-in-class services to its customer base.

Akram Alnabulsi, Closed Solution Engineering Director, Oracle Financial Services concurred with Alturief that Saudi Arabia offers a unique business environment. “Oracle’s cloud region in Jeddah was the fastest-growing data centre worldwide and the company

decided to invest and add more data centres in Saudi Arabia,” said Alnabulsi.

Saudi Arabia is emerging as a cloud hub, with an estimated 40% of the cloud adoption in the country coming from the financial service sector while 90% of fintech companies are using Oracle Cloud to power their solutions.

Alnabulsi said partnerships are an integral part of Oracle’s business model and “this is a strength point”. “To move to the cloud, a company requires a vendor that allows its applications to scale across multiple technologies - Microsoft, VMware and Oracle Open Source,” he added.

On capabilities, Alnabulsi said that a study by Oracle revealed that more

a company wants to introduce to the market,” he explained.

The implementation of Open banking in Saudi Arabia promises to create a new data-sharing infrastructure, which will form the basis of a much richer range of services and products across the entire financial services ecosystem.

The benefits of cloud computing are compelling in numerous sectors of Saudi Arabia’s economy and the banking sector is no exception.

Jose Afonso Pires, Member of the Board of Link Consulting said, in his presentation, that knowing a customer and what they do is something that all financial institutions can do by tracking interactions that a customer does with

A DIGITAL BANKING PLATFORM BUILT ON A CLOUD-NATIVE INFRASTRUCTURE OFFERS HIGH AVAILABILITY AND EXCEPTIONAL SECURITY ENSURING THAT BANKS MEET THE DYNAMIC NEEDS OF CUSTOMERS WITH CONTINUOUS FEATURE ENHANCEMENTS – Oracle Financial Services

than 400 customers in Saudi Arabia are using data centres. Oracle Cloud goes beyond storage or digital infrastructure to offer over 150 AI services ranging from the company’s compute and storage infrastructure to the development suite - whether it’s a visual builder or using Oracle development tools to the integration suite and analytics.

Alnabulsi also highlighted that Oracle Cloud’s security suite offers more than 40 security services. “The beauty about this is that we are using our services to build our applications and financial institutions can use financial applications or use the same tools that Oracle use to develop our applications to extend any SaaS application that

a bank’s mobile app, digital channel, call centre or when he goes to the counter.

However, banks are not able to react in real time and provide targeted content that specifically addresses a customer’s banking requirement.

Artificial intelligence From breakthrough technologies to ethical considerations, the current state of artificial intelligence (AI) is fundamentally changing industries, and the banking sector is no exception.

Badr Tharwat, MEA CTO of Oracle Financial Services said Oracle is working on several “very interesting” Al-driven projects in the Middle East. He explained that 77% of bankers believe that the mea-finance.com

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ORACLE ROUNDTABLE EVENT

ability to unlock the value of AI will be the difference between the success or failure of banks.

Today, different types of AI are available and advanced AI is where things are changing now. Tharwat said a British supermarket chain is leveraging Oracle’s

GenAI has the potential to revolutionise how businesses operate by increasing efficiency, speeding up the creation of complex content, and providing customers with more personalised experiences.

Oracle partnered with Canadian startup Cohere to provide its enterprise

progressing at a dizzying pace, with new models, architectures and innovations appearing almost daily.

“Oracle’s customers – both in the public and private sector – in Saudi Arabia are leveraging GenAI technology to upload their standard operation practices (SOPs)

cloud platform to optimise inventory management, billing and invoicing.

To deliver frictionless payments, Tharwat said just like Apple Pay or Samsung Pay, AI now allows banking customers to authenticate a payment on a mobile bank application using a smile – peer-to-peer payment.

Beyond banking channels and journeys, BaaS is underpinning and broadly unifying open banking, embedded finance, modular banking and banking as a platform – fluid terms in the dynamic financial service sector.

Tharwat said banks should consider the potential of open banking, with banking as a service. “Open Banking has just started in Saudi Arabia and Oracle has been making an amazing effort fostering its growth,” he said.

“AI use cases in banking are revolutionising both the front and back through innovative solutions such as smile-to-pay and conversational bots as well as real-time transactional analysis and risk monitoring,” Tharwat explained.

AI has been part of the toolkit of many industries and professionals for many years.

However, generative AI (GenAI) has stepped onto the scene - think ChatGPT, Google’s Bard, OpenAI’s DALL-E and Midjourney.

customers a way to build their GenAI apps without having to share their data in ways they may not want to do. “Cohere is a large language model, but what differentiates it from ChatGPT is that it sits in a company/ organisation premises,” Tharwat said, adding that Cohere is private, isolated and an entity can upload data in the cloud with confidence that no one will have access it.

Oracle will be embedding Cohere’s GenAI technology into a bunch of its products while Cohere is leveraging the software giant’s cloud technology to train, build and deploy its GenAI models. GenAI and large language models have been

into the cloud. Rather than going through tonnes and tonnes of documents, they can leverage Cohere,” Tharwat said.

AI technology is entering a new era, with a massive number of new consumer options arising from the creation of the GPT model several years ago. One year from today, industry experts believe the AI landscape will likely look very different than it does today and different in other ways a year after that.

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Digitalising corporate & transaction banking Globally, the growing demand from digitally savvy corporate and consumer

LENDING IS A PROCESS AND THERE ARE SO MANY STEPS THAT ARE ASSOCIATED WITH THAT PROCESS. AI AUTOMATES DOCUMENT PROCESSING, IMPROVES RISK ASSESSMENT, STREAMLINES THE LOAN APPROVAL PROCESS AND PERSONALISES MICRO-LENDING SOLUTIONS – Parag Ekbote

Banking and Finance news in the MEA market

customers, intense competition from new entrants and evolving regulations are forcing banks to fundamentally revisit their operating and business models.

Traditionally corporate digital customer experiences have lagged behind retail banking experiences and there is an

feature enhancements,” according to Oracle Financial Services.

Cloud technology provides a dynamic platform to develop, trial and offer innovative services – driving operating and business model transformation.

Cloud solutions allow incumbents

Krishnaswamy Srigarith, Senior Consultant at Saudi Payments said there is a general feeling in the market that might be shocking to banks – “I don’t need a bank to do banking”. Srigarith emphasised that this is a very clear and resonating statement, banking

urgent need to catch up. However, the growing desire to access financial services from digital channels has led to a surge in new banking technologies that are reconceptualising corporate and transaction banking.

Banks in Saudi Arabia are seeking closer customer relationships over multiple channels, a lower cost base and increased revenues from growing their transaction business with new services.

“A digital banking platform built on a cloud-native infrastructure offers high availability and exceptional security ensuring that banks meet the dynamic needs of customers with continuous

to augment the accessibility of their services and products from multiple locations and streamline their operations while creating an opportunity to deliver new and enhanced digital products.

customers do not need a bank, but they require banking services.

However, what does this mean to the banking industry and how is the sector adapting to evolving customer demands?

Srigarith said leveraging innovative technologies such as the cloud helps banks to sustain and remain in the market and be relevant in the market.

Banks should offer innovative services and products such as embedded finance to remain relevant in the market. “What is required here is for banks to redefine themselves as some sort of technology companies and coexist with tech giants such as Oracle, Amazon and whatever to cross-sell their products, particularly in the freight finance and corporate finance,” said Srigarith.

Naj Aktam, Head of Cash Management at BNP Paribas, said that as a global bank, digital transformation is something that the French multinational lender picked up a long time ago. “From an innovation perspective, as a bank, we realised that we will not make it if we continue to use our legacy system and not adopt a customer-focused approach. We are collaborating with fintechs and other players in the market that are accelerating digitalisation,” added Aktam.

Leveraging the cloud As the banking sector accelerates its digital transformation journey, cloud technology has emerged as a pivotal enabler for banks. Banks are recognising the potential of the cloud to enhance agility and security in their quest to meet evolving customer preferences a n d c o m p ete w i t h c l o u d - n a t i ve fintech firms.

WITH ISO 20022, FINANCIAL INSTITUTIONS CAN COMMUNICATE WITH EACH OTHER USING A COMMON DATA LANGUAGE, MAKING IT EASIER TO CONDUCT CROSSBORDER TRANSACTIONS AND ENSURING A HIGHER LEVEL OF STANDARDISATION ACROSS DIFFERENT PAYMENT SYSTEMS – Mohammed A. AlKatian

mea-finance.com

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ORACLE ROUNDTABLE EVENT

From a global banking perspective, Ahmed Najmeldine, Chief Operating Officer at Standard Chartered Bank said just like BNP Paribas, Standard Chartered in Saudi Arabia offers corporate banking rather than retail services. He highlighted that the bank has been collaborating with fintech companies to augment its services and products.

Cloud technology empowers banks with flexible and scalable IT infrastructure, allowing them to rapidly adapt to evolving banking needs and offer innovative, personalised services to customers. Yagoub Yousef Al-Sulaiman, Head of Transformation Management at Alinma Bank weighed in saying, the cloud is a very big added value to both banks and fintech companies”.

Al-Sulaiman said Alinma has participated in several cloud technology initiatives. The incumbent also has fintech, which helped the bank to scale up its operations when it was not yet using the cloud. Al-Sulaiman said the financial regulator in Saudi Arabia is playing an active role in accelerating innovation while highlighting the unveiling of the ‘Open Banking Lab’ in December 2022.

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From a regulation point of view, A b d u l a z i z As s i r i , I n f ra st r u ct u re Development Head at SAMA said the central bank is implementing several initiatives to accelerate digital transformation in the banking sector under the Financial Sector Development Programme, one of the pillars of Vision 2030.

IBM said cloud technology enables services to be tailored to specific

market or customer requirements and facilitates external collaboration with customers and partners, so they can share resources, information and processes.

Amol Bahuguna, SVP, Head of Corporate Technology, Innovation and Change Management at Riyad Bank said the bank was one of the first banks in Saudi Arabia to invest in private cloud.

The bank has its APIs and microservices

THE LAUNCH OF THE JEDDAH CLOUD REGION AND THE RESTRICTIONS THAT WERE IMPOSED TO MITIGATE THE SPREAD OF COVID-19 SERVED AS A DE FACTO CATALYST FOR CLOUD ADOPTION ACROSS DIVERSE INDUSTRIES IN SAUDI ARABIA, DUE TO SEVERAL REASONS INCLUDING QUICK TIME TO MARKET AND INNOVATION – Fahad Alturief

Banking and Finance news in the MEA market

on the cloud and is considering hosting other monolithic applications in the cloud.

From an ecosystem perspective, Abdulrahman Khan, Products and Innovation, Banque Saudi Fransi said change is vital in the financial services sector and traditional banks must be more innovative and embrace new technology to maintain a competitive edge and remain relevant in the future.

The dynamic scalability and elastic load-balancing capabilities of the cloud enable banks to handle peak transaction loads without compromising on service quality. “I believe that all the banks in Saudi Arabia are now ready with their digital transformation strategies and have a clear understanding of the requirements and the applications that can run in the cloud,” said Esraa Diwali, Senior Manager of Digital Payments at SAB. From a fragmentation perspective, Oleksandr Savchenko, Director – Head of Trade, Work Capital & Transaction Banking, Standard Chartered Bank posed a question asking if GCC countries want to roll out unified customs are the regional governments open to sharing data or

the data should be stored in several hybrid clouds.

Though banking leaders agree that cloud investment is a priority, many are yet to see the expected returns from their technology spending.

Augmenting credit & lending life cycle

Banking customers’ expectations about the range of services they can use have changed rapidly over the years, forcing financial institutions to partially switch to digital technologies to help customers track loan applications, access account information and make and receive payments.

“Lending is a process and there are so many steps that are associated with that process. AI automates document processing, improves risk assessment, streamlines the loan approval process a n d p e rs o n a l i s e s m i c ro - l e n d i n g solutions,” said Ekbote.

Yogesh Kapoor, Head of Enterprise Transformation at SAB weighed in saying that 20 years ago banks used to offshore financial services and this outsourcing process entails offshoring

the responsibility, but banks cannot offshore commitment to customers.

“AI use case in lending extends to credit scoring, loan approval, fraud detection and collection management, but not without the governance and controls that require bankers to continuously monitor lending and borrowing patterns,” he added.

Amazon Web Services said certain parts of the lending process such as underwriting and closing, are still done manually. Saudi banks are investing significantly in modernising these processes using data to help identify and better understand customer needs and assess credit risk.

Saleh Abdullah Almogamy, Head of Architecture at Alinma Bank concurred with other participants that AI is only as powerful as the data sets that are available to it. He said at the end of lending when banks make the final decision, they learn lending patterns to conclude on whether to reject or accept financing applications.

To augment the credit and lending life cycle as well as advance customer mea-finance.com

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experience, financial institutions a re c o n c e n t ra t i n g o n re m ov i n g friction from the closure processes, automating loan application processes, augmenting underwriting and credit risk assessments and creating ecosystems.

Jose Afonso Pires, a Member of the Board, of Link Consulting, highlighted the crucial role AI plays in supporting credit decision-making.

“Though lending is typically a process, there is discrete information that can be evaluated whether or not the application is compliant to provide a loan,” Pires said, adding that with AI, banks can determine the likelihood of a customer’s ability to fulfil the terms of the loan based on similar situations.

Afnan Al-Ammar, Acquiring Product Manager – POS, Banque Saudi Fransi concurred with Abdulrahman Khan that AI is a helpful tool in identifying the clients who would be potential clients to have the PR financing.

Banks are leveraging cloud technology and other digital capabilities to change business models. The cloud makes it easier for financial institutions to build solutions that use data to develop a more holistic understanding of customers and use the insights to advance customer experience.

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AI USE CASES IN BANKING ARE REVOLUTIONISING BOTH THE FRONT AND BACK THROUGH INNOVATIVE SOLUTIONS SUCH AS SMILE-TO-PAY AND CONVERSATIONAL BOTS AS WELL AS REAL-TIME TRANSACTIONAL ANALYSIS AND RISK MONITORING – Badr Tharwat

Payments in the cloud Digital payments have evolved over the past 40 years from proprietary platforms to more open standards enabling more connectivity and data sharing.

Mohammed A. AlKatian, IT Strategy & Architecture – Senior Director, Saudi Payments said interoperability for realtime payments.

He highlighted that ISO 20022 enables interoperability between different payment systems, which is critical in today’s global financial ecosystem.

“With ISO 20022, financial institutions can communicate with each other using a common data language, making it easier to conduct cross-border transactions and ensuring a higher level of standardisation across different payment systems,” added AlKatian.

Banking and Finance news in the MEA market

Mohammed Al Jaser, Senior Enterprise Architect, Saudi Payments echoed similar sentiments, saying in a world of instant payments, banks are digitising their core banking platforms to have access to realtime payments. The transaction banking division, which includes treasury and cash management, corporate payments and trade finance, remains a steady source of revenues and profit.

“Oracle started to rework its core banking platform more than 20 years ago as Iflex, which was later renamed Flexcube and today it is known as Oracle Banking. Oracle Banking is a one-stop solution for a bank for its core banking operations, across retail and business banking operations,” said Oracle’s Chaker.

Chaker highlighted that the platform’s integrated payment hub covers all payment schemes including real-time payments, SWIFT, RTGS and Automated Clearing House (ACH). The core banking solution is being leveraged by Citigroup, Al Rajhi Bank and UniCredit to transform banking operations across retail, corporate, SME, microfinance and Islamic banking.

Deloitte said while these businesses have significantly benefited from the international flow of funds, trade, services and capital, in the long term they would have to contend with new fragmentation risks to their revenue pools and operating models.

“Simply understanding the market trends, the business needs and then start working on real-time payment initiatives will help banks to adopt the right strategy.

Providing it and explaining it clearly to the

old stakeholders, will help you to achieve and go live immediately,” said Diwali.

He added that financial institutions should provide the service and explain it clearly to the stakeholders, which will help them to achieve and go live immediately.

“Strategy is a vision, mission, objectives, initiatives,” George Hadid, IT Senior Business Relationship Manager, Service Demand at The Saudi Investment Bank said, adding that if a bank has the

strategy, for example, targeting a niche segment or category of customers, the machine will give you the decision to approve the facilities.

Meanwhile, Hailah Almajhad, Head of Systems at SAMA said strategy is like dreams. “Everyone can dream, but when it comes to execution it has to be like an endorsement,” Almajhad said, adding that it takes a minimum from three to five years for a strategy to come to fruition.

ORACLE STARTED TO REWORK ITS CORE BANKING PLATFORM MORE THAN 20 YEARS AGO AS IFLEX, WHICH WAS LATER RENAMED FLEXCUBE AND TODAY IT IS KNOWN AS ORACLE BANKING. ORACLE BANKING IS A ONE-STOP SOLUTION FOR A BANK FOR ITS CORE BANKING OPERATIONS, ACROSS RETAIL AND BUSINESS BANKING OPERATIONS – Houssam Chaker

With the business-to-business crossborder payments market expected to be valued at $42.7 trillion by 2026, legacy platforms and infrastructure make payments slow, expensive and opaque.

The migration to the new ISO20022 standards promises to provide banks with richer data to achieve their digital aspirations. ISO 20022 is emerging as a common language and model for financial messages across the world.

SWIFT projected that 80% of global, high-value payments by volume will be processed through this standardised messaging system as major currencies are adopting it.

The move to ISO 20022, meanwhile, is more than just a mandatory exercise. Instead, it’s a key factor in driving innovation and building a frictionless future – offering new opportunities and the chance to enhance services all along a transaction’s lifecycle.

The G20 has outlined a roadmap to improve the speed, cost, transparency, choice and accessibility of cross-border payments, and new developments are coming thick and fast to help realise these goals. mea-finance.com

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LEADERS IN PAYMENTS 2023

A Real Time of Change for Payments The payments sector has evolved dramatically in the region over the past few years, driven by new innovative technologies, governments’ push for cashless economies as well as changes in customer behaviours and regulatory shifts

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Banking and Finance news in the MEA market

T

he payments industry remains resilient – despite the combined ef fe ct s of ex p a n s i o n a r y monetary policy, geopolitical tensions, pandemic-induced supply chain shocks and a macroeconomic e n v i ro n m e n t c h a ra c t e r i s e d b y high inflation and soaring prices of commodities.

The changes in the payments space are being accelerated by the advancements in innovative technologies and evolving customer expectations

that have shattered the status quo and opened the window for new players that are challenging legacy banks.

The Middle East payments market has significantly expanded over the years to include fintech and BigTech firms and telecom companies alongside traditional banks. Boston Consulting Group (BCG) said incumbents have a chance to alter their growth trajectory and win a significant share in the burgeoning payments market.

There is likely no stopping to the exponential growth of instant real-time payments in the region with financial institutions expected to continue implementing initiatives to modernise the sector in the medium term.

Traditional banks in the region are also carving out payment businesses to form separate entities that can act like fintech companies and compete more nimbly in a bid to remain relevant in an evolving market.

C a n a d a ’s B r o o k f i e l d A s s e t Management agreed to acquire Emirates NBD-backed Network International for $2.76 billion in June as the Middle East and Africa regions have emerged as an interesting space for innovation in the advancement of domestic and regional payment systems.

“Having shown resilience to both to the COVID-19 pandemic and to some major macroeconomic shocks affecting other regions, the Middle East region payments sector will grow at a compound annual growth rate (CAGR) of 9.8% for the region through 2026, in stark contrast to the 4.7% observed in the period from 2016 to 2021,” said BCG. MEA Finance hosted its Leaders in Payments Conference and Awards 2023 on 14 September 2023 at The RitzCarlton Hotel - JBR in Dubai. The exclusive annual forum attracted leading finance, fintech and technology professionals who discussed the latest developments in the payments services sector while identifying emerging trends and opportunities in the region.

Participants in the 2023 Payments Summit highlighted several current

THE CONTINUOUS DEVELOPMENT OF PAYMENT SYSTEMS IS ESSENTIAL AS IT FORMS THE CORE OF THE GLOBAL ECONOMY, IMPACTING TRADE, BUSINESS AND THE REST OF THE ECONOMY – Jamal Saleh

topics, including the role of regulators in providing a legislative and regulatory environment that stimulates the development of payments and the role of innovative technology and the cloud in the development of instant payments.

Jamal Saleh, Director General of the UAE Banking Federation (UBF) underlined the Central Bank of the UAE (CBUAE)’s initiatives in the field of payments to meet the needs of stakeholders in line with the National Strategy for Payment Systems, which was launched in 2019.

Saleh said CBUAE is developing the payment infrastructure to ensure wider acceptance of cashless payment methods, provide payment and settlement services and enhance transparency and financial stability.

Positioned for growth – regulation & standardisation The Middle East region’s payments ecosystem has evolved dramatically over the past three years, driven by technological advancements, governments’ push for cashless payments, changes in customer behaviours and regulatory shifts – trends that are expected to continue driving disruptive business models in the payments space in the years to come.

Moderated by Lucian Crisan, Senior Manager - Fintech and Financial Services, PwC, the Regulation, Standardisation and Ongoing Developments panel highlighted the role that regulation and standardisation activity are playing in driving growth in the Middle East region’s payments sector.

The discussion had the participation of Ken Coghill, Director - Head of Innovation & Technology Risk Supervision, Dubai Financial Services Authority (DFSA); Altaf Ahmed, Director, Digital Payments & Retail Solutions, e&; Mohammed Wassim Al Khayata, CEO, Al Maryah Community Bank; Viplav Rathore, Managing Director - Head of Cash Management Products for Africa & MENAP, Standard Chartered Bank; Gabrielle Inzirillo, Head of Ecosystem Development, Abu Dhabi Global Market (ADGM); and Samer Soliman, Chief Executive Officer at Arab Financial Services (AFS).

Crisan opened the panel by asking how non-bank institutions such as e& Group have benefited from the emergence of innovative technologies and how they are leveraging these trends to offer better products and services. e & G ro u p’s A h m e d s a i d telecommunications is the company’s core business. However, its subsidiary, e& Enterprise, which is a business-tobusiness (B2B) digital transformation solution provider, offers a wide range of solutions including digital payment solutions. “One of the innovative technologies that we have been utilising in the past few years is the cloud to enhance payment offerings and it is one of the key differentiators that will shape the future of payments,” he added.

The chessboard is being rearranged and understanding these market innovations and acting is critical for financial institutions seeking to grow and prevent disruption. mea-finance.com

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Giving an example of Zip-Zap machines, popularly known as knuckle-busters, Soliman said innovation in the payments space has been going on for many.

“We started with the digital post terminal where, we started accepting payments using swipe machines rather than Zip-Zap machines, which was followed by android devices that unlocked many opportunities in terms of the acceptance of payments. Recently, AFS unveiled the soft point of sale (POS) terminal that converts Android devices into a payment acceptance terminal,” said Soliman.

He highlighted that adoption is one critical aspect that AFS focuses on when designing or constructing customer journeys. “We started rolling POS machines in 1998 and it took a very long time to adopt,” said Soliman.

The payments ecosystem is constantly adapting to and embracing emerging trends, technologies and customer preferences such as contactless payments, digital wallets and real-time transactions.

From a supervisory perspective, Coghill said the objective of a payments services provider is making a profit while the regulator’s key focus is to protect the users of a product or service. “But

ADGM’s Inzirillo weighed in saying payments as an industry is difficult to regulate, it is a specific industry that requires so many moving parts, good technology, incredible infrastructure and more importantly tonnes of partnerships to make a good solution that fulfils the needs of users.

She highlighted that a common misconception in the financial services

Asked what regulators could do to accelerate the growth of the payments sector, Standard Chartered Bank’s Tikyani said regulators have a difficult job of balancing both the robustness of the regulation and leaving some room for innovation.

“I recommend regulators to have continuous dialogue with the industry, with peers across borders to develop

as regulators, and having a broader objective of protecting users, the financial ecosystem, the integrity of the marketplace in which a payments service provider operates, we have to consider the systemic consequences and the potential unintended consequences that could come out of introducing new rules,” Coghill explained.

sector is that regulators, whether it is the Central Bank of the UAE (CBUAE) or the Dubai Financial Services Authority (DFSA) impede innovation, in actual fact “regulators want financial institutions to give more details on products or services and why their solutions are much better than the others, and how the end users can be protected.”

parity in the regulations. Regulations in one jurisdiction shouldn’t be very different from the other so that whoever has to follow the regulations, fintech firms or banks, do not have to match two different aspects,” said Tikyani.

On how digital banks are fostering inclusion while addressing trust concerns, Khayata said being a financial services

WITH THE VAST TRANSFORMATIONS TAKING PLACE IN THE WORLD OF PAYMENTS, WE MUST APPROACH THEM WITH A CLEAR VISION, AS WELL AS THE IMPORTANCE OF GUIDING STAKEHOLDERS, INCLUDING BANKING AND FINANCIAL INSTITUTIONS, TECHNOLOGY COMPANIES AND INDIVIDUALS, WITH THE PRINCIPLES AND STANDARDS OF JUSTICE, SECURITY, TRANSPARENCY AND GOVERNANCE, AND COMPLYING WITH THEM TO ENSURE A SAFE AND SEAMLESS EXPERIENCE FOR ALL – Jamal Saleh

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LEADERS IN PAYMENTS 2023

provider regulated by the CBUAE, the trust element is there and Mbank UAE’s application provides customers with the ability to set limits of cash withdrawals, point of sale transactions and online payments among other services.

With instant payments becoming a global phenomenon, regional countries including the UAE and Saudi Arabia are rolling out this innovative form of funds transfer, allowing immediate availability of the funds for people and businesses.

Real-time payments - financial institutions The Middle East is fast becoming the global hotspot for the real-time payments revolution sweeping the globe. The region’s payments ecosystem stands at the edge of significant returns as the pace of fintech disruption moves at a relentless speed.

The discussion on the Business Case for Real-Time Payments and the importance of real-time payments was moderated by Sandeep Dhawan, Regional Head of Product – Payments at J.P. Morgan. The panel had the participation of Jagadeshwaran K, Managing Director - Treasury & Trade Solutions, MENAPT at Citi; Gautam Dutta, MD & Head - Cash Product Management & Innovation at First Abu Dhabi Bank; Mahmoud Abuebeid, CEO & Board Member, Global Software Solutions (GSS) Group; Siva Subramanian, Head - Product Management - Payments &

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ONE OF THE INNOVATIVE TECHNOLOGIES THAT WE HAVE BEEN UTILISING IN THE PAST FEW YEARS IS THE CLOUD TO ENHANCE PAYMENT OFFERINGS AND IT IS ONE OF THE KEY DIFFERENTIATORS THAT WILL SHAPE THE FUTURE OF PAYMENTS – Altaf Ahmed

Cash Management, Infosys Finacle; and Abdulrahman Khan, Head of Products & Innovation, Banque Saudi Fransi.

Dhawan opened the discussion by asking the panellists about their favourite mobile app. He highlighted that his favourite mobile app is DubaiNow because it offers access to all the services in Dubai, from paying electricity bills to renewing vehicle registration to paying traffic fines. “I want to drive home the point that the growth of real-time payment schemes is being accelerated by many forces – one of them being convenience.”

Global payment solutions firm, ACI Worldwide, said the region is the fastestgrowing real-time payments market globally, with transactions projected to grow at a CAGR of 30.6% from $675 million in 2022 to $2.6 billion by 2027.

Citi’s Jagadeshwaran said instant real-time payments are not a new phenomenon, they have been around for a while. “UAE’s Instant Payments Platform (IPP) traces its roots back to 2018 and the launch of the National Payment Systems Strategy (NPSS) in the country w h i c h i s s e t to turbocharge instant payment schemes,” he said.

Jagadeshwaran projected that the future of the instant

Banking and Finance news in the MEA market

payments sector is characterised by interoperability, interconnectedness and convergence.

Real-time payments deliver speed and convenience along with a range of other features on the services layer.

“Saudi Arabia is the Middle East region’s largest real-time payments market with 352 million transactions recorded in 2022 while 37.2 million transactions were executed in the UAE, as the figure is expected to grow at a CAGR of 31.5% to reach 146 million by 2027,” said Dutta.

He accentuated that real-time payments will revolutionise the way we transact in the future, driven by payments tokenisation that is happening in the central bank digital currencies (CBDC) space on the distributed ledger.

GSS Group’s Abuebeid weighed in saying there has been a dramatic change in the way we send money across borders over the past decade. “We are witnessing an overall increase in the volume of payments in the real-time payment space, but the average ticket size is decreasing due to microtisation of remittance,” said Abuebeid.

He highlighted that the emergence of open banking will facilitate the sharing the financial data between the banks and other third-party providers, paving the way for the development of innovative payment services.

They bring transparency, certainty and precision to the process of moving funds and fulfil the needs that consumers and businesses have for nextgeneration payments.

While real-time payment initiatives have initially centred around domestic retail payments, these are expected to evolve into the corporate, business-to-business segment and cross-border space.

Subramanian said the growth of realtime payments is evident in the increase of B2B and B2C transactions that have grown exponentially over the years. “More than 70 countries are at multiple stages of real-time payments readiness. In addition to driving business growth across borders, they give access to new markets and more transparency to the fragmented and unpredictable B2B payments landscape,” added Subramanian.

Turning to Saudi Arabia, Banque Saudi Fransi’s Khan said the Saudi Central Bank (SAMA) unveiled its real-time payments initiative ‘Sarie’ in 2021, as part of the kingdom’s Financial Sector Development Program (FSDP) under Vision 2030, to achieve 70% non-cash transactions by 2030.

“Sarie allows bank customers to send and receive money in real-time using a wider range of services and transfer

options. Customers of local banks can make instant transactions of up to $5,300 (SAR 20,000) through the system,” said Khan.

Furthermore, Sarie users can benefit from the quick transfer service to send up to $660 (SAR 2,500) using mobile phone number, email address, ID number or IBAN, he added.

SAMA said the share of digital payments in the retail sector reached 62% of total payments, including cash, in 2022, exceeding the 60% target set by the FSDP under Vision 2030.

The real-time payments technology is accelerating global consumer demand to be able to pay and be paid in real-time, putting the onus on market infrastructures to meet these expectations.

Payments data monetisation

The ‘In Conversation With’ session between Ramana Kumar, the CEO of Magnati and Arjun Singh, Partner – Global Financial Services at Arthur D. Little touched on various aspects of data monetisation in the payments industry.

Kumar said today’s payment solution providers have a treasure trove of data at their fingertips. “By using it to generate insights into consumer purchasing behaviour and coupling these insights with an understanding of emerging trends, payments firms can provide better service to customers - from fraud detection to spending insights,” he said.

Asked about use cases that have emerged from data monetisation over the past three years, Kumar said Magnati started investing in data monetisation models more than six years ago.

Arthur D. Little’s Singh said data monetisation is a two-sided coin. “First, there is more data which is now available and accessible for several reasons, including the fact that our lives have become increasingly digital. Secondly, consumers are increasingly waking up to the reality that data is theirs, which the vast majority of the world doesn’t understand,” added Singh.

The role of the cloud in payments The Middle East has fully embraced digital payments, enabled by a supportive government focus and a strategic push towards digital or cashless economies.

With digital payments and transaction volumes growing across the region, one of the main advantages of moving to the cloud is the ability to pre-empt and automatically address spikes in payment processing.

The Role of the Cloud in Payments panel was moderated by Saad Ansari, Co-founder & CEO of Xpence. It had the participation of Mohammed Wassim Al Khayata, CEO of Al Maryah Community Bank; Mohamed Roushdy, Founder mea-finance.com

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of Fintech Bazaar; Hani Idris, CEO of International Development Bank and Sasi Nair, Head of Technology Service Delivery, Commercial Bank of Dubai.

“Without the cloud, I don’t think we were able to achieve what we built over the past four years with my team at Xpence – rapidly launching and scaling at quite a low cost across multiple markets,” said Ansari.

The cloud platforms enable financial institutions to embed agility – banks can focus more on creating value for customers and less on transaction p ro c e s s i n g a n d i n f ra s t r u c t u re maintenance. Khayata said Mbank’s mobile application is cloud-based, and the digital bank is leveraging Azure for cybersecurity.

“Today, cloud-based accounting syste m s h a ve c l o u d c o m p u t i n g capabilities to generate invoices, to even process payroll, to do payment instructions and financial reporting,

“For payment companies, the sudden surge in demand calls into question the ability of a company to allocate resources to handle the heaviest predicted uptick in transactions without a degradation in performance,” said Amazon Web Services.

On trends that are shaping the use of the cloud in payments, Idris

70% of their population is under the age of 30.

Cloud computing has become the requisite technology foundation across every industry, providing better access to data, dynamic scale, built-in security and agile capabilities that drive new features and innovations – the payments industry is no exception.

which includes tax. The cloud is the future for payment services,” said Khayata.

Cloud adoption is the backbone of digital innovation, and it is shaping the future of the financial services sector.

From a fintech perspective, Roushdy said as much as 40% of fintech firms are in the payments sector and it is the space that has experienced a high level of disruption within the financial service, driven by the surge of new technology-driven payment processes, new digital applications that facilitate easier payments and alternative processing networks.

said countries in emerging markets, including the GCC region, have a good opportunity to adopt the latest innovative technologies in the payments space and other financial-oriented and banking services.

“The emerging markets have a unique opportunity because most of these countries have not yet been in the payment industry from the initial stage, keeping in mind that we are now in the fourth revolution from the industrial revolution, which is the digitalisation of revolution,” Idris said, adding that these countries have very special characteristics in that

F ro m a te c h n i c a l c h a l l e n g e s perspective, Commercial Bank of Dubai’s Nair said cloud technologies are mainly associated with flexibility and that flexibility comes with a lot of configurations. He said a misconfiguration with a financial service such as payments can be disastrous.

Citing a study by Gartner, Nair revealed that 99% of cybersecurity breaches are happening because the cloud security settings are not configured in the right manner or there is no configuration at all.

“Data privacy and compliance is a major concern when it comes to the

WE STARTED WITH THE DIGITAL POST TERMINAL WHERE, WE STARTED ACCEPTING PAYMENTS USING SWIPE MACHINES RATHER THAN ZIP-ZAP MACHINES, WHICH WAS FOLLOWED BY ANDROID DEVICES THAT UNLOCKED MANY OPPORTUNITIES IN TERMS OF THE ACCEPTANCE OF PAYMENTS – Samer Soliman

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LEADERS IN PAYMENTS 2023

use of the cloud in payments. Payments contain a lot of sensitive financial information and customer data; hence it is important that financial institutions ensure that customer data is secured within the perimeter,” adds Nair.

P a y m e n t p ro v i d e r s h a v e a n opportunity now that did not exist in the past decade to predict and anticipate what customers want and simultaneously reinvent themselves. Cloud systems for payments offer the flexible architecture and technology solutions needed to continuously iterate, improve and respond to customer needs.

ISO 20022 & cross-border payments

OVER THE YEARS, CROSS-BORDER PAYMENTS HAVE LONG BEEN PLAGUED BY SLOW TRANSACTION TIMES, HIGH COSTS AND A LACK OF TRANSPARENCY. HOWEVER, INNOVATIVE TECHNOLOGIES OFFER SIGNIFICANT GAINS TO MARKET EFFICIENCY, COMPLETENESS, AND ACCESS, AS WELL AS TO TRANSPARENCY, TRANSACTION AND COMPLIANCE COSTS, AND SAFETY – Paul Bryson

T h e a d o p t i o n of I S O 2 0 0 2 2 , a globally developed methodology for transmitting data that provides a consistent messaging standard for payments, by financial institutions is expected to bolster the acceleration of cross-border, cross-currency instant and business-to-business payments in the next five years.

Moderated by Sanjiv Purushotham, Managing Partner, Bridge DFS, the ISO

BUNA, Anand Sampath, Managing Director, Head- Payments, Collections & Client Implementation, First Abu Dhabi Bank (FAB); and Onur Ozan, Regional Head, Middle East, North Africa & Turkiye, Swift.

“ISO 20022 has been available for processing for about six months now and we have done well as a community, barring some teething issues in terms of getting to where we are. We can

ISO 20022 is emerging as a common language and model for financial messages across the world. SWIFT projected that 80% of global, high-value payments by volume will be processed through this standardised messaging system as major currencies are adopting it.

SWIFT’s Ozan said there are two ways to approach the topic of ISO 20022 and these two approaches will converge at

20022 and Cross-Border Payments in Review panel highlighted whether ISO 20022 has had any immediate impact on the payments space six months after its introduction. The panel had the participation of Pritesh Kotecha, SVP, MEASA, Smartstream; Ahmed El Hefnawy, Chief Business Officer,

safely say that the remodelling of crossborder payment space has started,” said Sampath.

“Middle East and Asian countries have almost adopted ISO for their payment infrastructure while Europe and the Americas are expected to do so in 2023 and 2024, respectively,” he added.

some point. “One is the cross-border element and that is the one we are driving when we are talking about the November 2025 deadline while the second approach is taking place in the domestic payments or the regional landscapes, such as Buna, on adopting ISO 20022 for payments and cash management,” he said.

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Banking and Finance news in the MEA market

He further highlighted that the journey started in 2018 for cross-border payments when the industry set a milestone of November 2025 and currently the industry is in the middle of the transition to ISO 20022 for payments and cash management messages.

Buna’s El Hefnawy weighed in saying harmonisation by November 2025 is a bit ambitious as many stakeholders are yet to start their migration to ISO 20022.

“Buna has access to over 100 participants and knows who has made how much progress. There are some organisations, that have made a lot of effort to migrate to ISO 20022,” he said.

Kotecha said the adoption of ISO 20022 in cross-border payments will be driven by the opportunity, adding that he believes “the opportunity in cross-border payments is massive”. “Last year, as much as $156 trillion worth of cross-border payments flew across the globe, one the corporate side it was $24 trillion and to put that into perspective, that’s 25% of global GDP,” added Kotecha.

Meanwhile, the growth of crossborder payments in the Middle East is being driven by governments that are

developing instant payment systems through bilateral and multilateral agreements and the rise of pure-play online retailers enabling e-commerce across geographies.

Purushotham asked Sampath what the future holds for ISO 20022. Sampath drew the forum’s attention to G20 efforts in terms of bringing transparency in the cross-border payment space. He highlighted that the size of the crossborder payments industry cannot be underestimated. “We are looking at a more than $250 trillion industry by 2027.

So, to achieve transparency around cross-border space, G20 set out about 2019 building blocks categorised into five different topics,” said Sampath.

Frustration with the traditional correspondent banking model, both cumbersome and costly in a world of instant, low-cost payments, has led to the intensification of non-bank providers.

Ozan concurred with Sampath that back in 2020, the G20 under the Presidency of Saudi Arabia, embarked on the journey to enhance cross-border payments. “ISO 20022 helps financial institutions with the interconnectivity

between cross-border payments and local domestic payments, and that in some form of standardisation and harmonisation – one of the important pillars of cross-border payments have been achieved,” he said.

Globalisation, digitalisation and the rise of e-commerce have changed the way consumers around the world shop, creating a truly global marketplace and cross-border payments revenues are on track for solid growth over both a five-year and a ten-year horizon despite economic headwinds.

Monetising payments & thirdparty risk The next ‘In Conversation With’ session between Sagar Chandiramani, CEO of WorkerAppz Payments, Navin Gupta, Managing Director, Southeast Asia & MENA, Ripple and Arjun Singh, Partner, Global Financial Services Practice, Arthur D. Little, spotlighted the opportunities emerging from the monetisation of real-time payments and the impact of regulations on third parties.

Chandiramani said data has always been around, but the advancement in

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LEADERS IN PAYMENTS 2023

technology is enhancing the ability to leverage customer data. “Innovative technologies are providing tools which dissect customer data to figure out how the data fits into the company’s existing ecosystem as well as more products,” added Chandiramani.

“From a payments perspective, WorkerAppz Payments started with cross-border payments for individuals and corporates. Now when we do money transfers and study how businesses and individuals move money, we realise that companies could ascertain an indicative value of cross-border trade most importantly.”

Asked how cross-border payments can remain profitable if all frictionrelated costs were to be solved, Ripple’s Gupta said it is obvious the industry and business models will evolve with time and new cross-border payments will emerge in the coming 50 years.

The clients and the customers It is no secret that customer experience

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is the new battleground for financial services providers. It has emerged as the most important competitive differentiator and a key driver of growth, loyalty and retention within the payments space.

The discussion on The Clients and Customers - Needs and Requirements from Modern Payments was anchored

by G o n c a l o Tra q u i n a , Pa r t n e r, KPMG Lower Gulf. The panel had the participation of Paul Bryson, Managing Director, Virtuzone; Raju Adnani, MEA Head of Domestic Payments, Citi; Vibhor Mundhada, CEO, Neopay, Mashreq; Ibtissam Ouassif, Co-Founder and CPO, Cashew Payments; Omar Haddad, General Manager - GCC Cluster II, Paymob; Nisreen Al Matarweh, Account Director, Swift and Seemanti Considine, Head of FI and Transaction Banking at Wio Bank.

Traquina opened the panel by highlighting that the world finds itself in the interception of financial innovation and evolving customer expectations.

“Over the years, the financial industry

Banking and Finance news in the MEA market

has witnessed a whirlwind of technology advancement from real-time payments to ISO 20022 to instant payment platforms and the cloud,” Traquina said, adding that the innovations promise to reduce pain points, streamline processes and usher in quicker, smoother and much more efficient payments experience.

Pa y m o b’s H a d d a d s a i d b e i n g customer-centric starts with the vision of an organisation itself and its leadership.

He highlighted that payment firms or financial institutions can tailor their products to meet customer needs and requirements by collecting customer feedback and data.

Mundhada said payment firms need to understand that payments have to be seamlessly integrated into a user journey because it is something that the user utilises to facilitate transactions.

“Payment services and products need to follow what the customer wants, and by default, financial services providers should be customer-centric in approach,” added Mundhada.

Virtuzone’s Bryson said the Dubaibased company formation specialists process thousands of cross-border transactions a month. “Over the years, cross-border payments have long been plagued by slow transaction times, high costs and a lack of transparency.

However, innovative technologies offer significant gains to market efficiency, completeness and access, as well as to transparency, transaction and compliance costs and safety,” said Bryson.

Customer experience is also a strategic imperative in today’s digitally disrupted world. Similarly, the payment industry is a complex network of stakeholders, technologies, processes and regulations that facilitate the exchange of monetary value for goods and services.

“We consult and partner with clients to understand their requirements while joining forces with fintechs to get insights into how they are managing to crack the code on user experience. We marry the two together to come up with our innovative customer-centric solutions and that’s what we are doing with crossborder payments,” said Considine.

Within this ecosystem, issuing banks, acquiring banks, payment processors, payment gateways and payment networks collaborate to ensure smooth operations. Overall, the payments ecosystem operates under the guidance of local, regional and global regulatory bodies that enforce compliance, security and consumer protection measures to

UAE’S INSTANT PAYMENTS PLATFORM TRACES ITS ROOTS BACK TO 2018 AND THE LAUNCH OF THE NATIONAL PAYMENT SYSTEMS STRATEGY IN THE COUNTRY WHICH IS SET TO TURBOCHARGE INSTANT PAYMENT SCHEMES – Jagadeshwaran K

maintain the integrity and stability of the financial system.

Reminiscing the time when SWIFT GPI was launched in 2017, Al Matarweh said cross-border payments were associated with slow transactions and it took forever for the payment to reach the beneficiary. “With SWIFT GPI, we are focused on addressing these challenges.

Thousands of institutions are now on GPI and more than 95% of global payments are processed in less than 24 hours and around 50% is less than three minutes,” she said, adding that “if you compare the challenges before GPI to after GPI, one can see the difference.”

Cashew Payments’ Ouassif said the buy-now-pay-later (BNPL) space and embedded finance are great use cases of modern payments, given that they are available at the point of checkout when the user needs it the most.

Citi’s Adnani echoed the views of fellow panellists that modernising the payment infrastructure has been a very critical

step to meet the growing consumer demands and the evolving regulatory landscape. “The payments industry is going through an exciting phase, and we are witnessing the transformation at play in the instant real-time payments that are being accelerated by emerging technologies such as the cloud,” said Adnani.

Leading bankers and technology professionals who attended the MEA Finance banking technology summit agreed that the emergence of innovative technologies such as the cloud, the changes in the regulatory environment, changing customer behaviours and reimagined customer experiences are fuelling the move to frictionless, embedded finance journeys.

The real-time payment options that financial institutions offer to customers are now a differentiator and understanding the underlying technology and the payment preferences of the targeted segment is vital.

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CONFERENCE & AWARDS 2023

Banking and Finance News in the Middle East Markets

LEADERS IN PAYMENTS AWARDS 2023

The MEA Finance Leaders in Payments Awards 2023 spotlights the innovations and achievements of the region’s top banking, fintech and financial technology players

T

he winners of the MEA Finance Leaders in Payments Awards 2023, held at the Ritz Carlton Hotel JBR in Dubai, were announced and presented with their awards on the 14th of September in a ceremony packed with senior executives from banking, fintech and payments technology providers.

These special payments focused awards bring recognition to the key individuals and businesses that are, through their hard work, innovative approaches and dedication, building a new, smarter and more agile payments ecosystem in the region that will transform transactions, from the day-to-day to the corporate, and positively influence the lives of people and businesses across the region Organized by MEA Finance Magazine and already regarded as the apex of recognition for payments excellence across the region, the awards programme spotlights the genuine innovations and stand-out performance of institutions in the banking, fintech and payments technology space.

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A high number of entries underwent evaluation by a panel of judges comprised of industry experts before conferring the prestigious awards to the winners. The panel selected twenty-four category winners following concentrated consideration of their research and knowledge of the market, understanding of the needs of their full range of clients and customers and an assessment of all relevant developments and achievements from the preceding year.

Here follows the full list of the MEA Finance Banking Leaders in Payments Awards 2023 winners: 1. Best Payment Gateway - Mastercard 2. Best End-to-End Online Payments Processing Systems Provider - Checkout.com 3. Best Real-Time Payments Provider - Infosys Finacle 4. Best Real-Time Payments Implementation - ENBD X by Emirates NBD 5. Best Digital Overlay Payment Service Provider - ACI

Banking and Finance news in the MEA market

6. B e s t P a y m e n t Te c h n o l o g y Implementation - UAE - Mashreq NEOPAY 7. Best Payment Technology Implementation - KSA - Banque Saudi Fransi 8. Best User Experience in Payments - UAE - Al Ansari Financial Services PJSC 9. Best User Experience in Payments - KSA - Banque Saudi Frans 10. Best Cross-Border Payments Technology Provider - Smartstream Technologies 11. Landmark Innovation in Cross-Border Payments Award - Swift 12. Best Payments Service Award - HPS 13. Best Open Banking Payments Project - First Abu Dhabi Bank 14. Best Payments Inclusivity Initiative - Magnati 15. B est Instant Payments Technology Implementation - Commercial Bank of Dubai 16. B est Instant Payments Technology Implementation Provider - Global Software Solutions Group (GSS) 17. Best Remittance and Foreign Exchange Service Provider - Al Ansari Exchange LLC 18. Overall Best Payments Platform in the Middle East - HPS 19. Payments Innovation of the Year - KSA - Banque Saudi Fransi 20. Payments Innovation of the Year - UAE - Commercial Bank of Dubai 21. Best Innovation in Payments Technology - Arab Financial Services (AFS) 22. Payments Technology Executive of the Year - Samer Soliman, Chief Executive Officer, Arab Financial Services (AFS) 23. Digital Payments Leader of the Year - Ramana Kumar, Chief Executive Officer, Magnati 24. Payments Executive of the Year - Onur Ozan, MD, Regional Head for Middle East, North Africa and Turkiye, Swift

Celebrating Excellence in the Regions Payments Industry

I

Nap Estampador Group Commercial Director, MEA Finance Magazine

n the ever-evolving landscape of the payments industry, it is important to recognise and applaud those who consistently raise the bar, innovate and drive positive change. In this special issue, we are delighted to extend our heartfelt congratulations to all the exceptional winners of our 2023 MEA Finance Leaders in Payments Awards.

Amidst fierce competition, and in a region known for its dynamic financial ecosystem, this year’s recipients have demonstrated marked dedication, vision and a relentless pursuit of excellence in the payments sector. Their remarkable achievements have not only set new benchmarks but have also inspired the entire market.

All winners are true trailblazers in the Middle East payments arena, demonstrating unwavering commitment to enhancing financial inclusivity, security and efficiency in payments. Their groundbreaking initiatives and forward-thinking strategies have not only transformed the way payments are processed but have also made a lasting impact on countless businesses and individuals.

In a region known for its rapid technological advancements and diverse consumer needs, this year winners have consistently adapted, innovated and thrived. They have forged invaluable partnerships, introduced cutting-edge solutions and championed financial literacy to empower the region’s populace.

Beyond their impressive financial accomplishments, it is their additional desire to combine ethical practices, a customer-centric approach and commitment to sustainability, sets them apart. In an era where financial institutions are increasingly scrutinized for their societal impact, the winners have set new standards in corporate responsibility.

As we celebrate these commendable achievements, let us also reflect on some wider meanings of their successes, reminding us that in our interconnected world, financial services has the power to transform lives, bridge gaps and drive economic growth. Their efforts serve as an inspiration for all who aspire to make a positive difference through innovation and dedication.

In closing, we extend our heartiest congratulations to all the winners for their well-deserved recognition. We eagerly anticipate their continued successes and the transformative impact they will undoubtedly have on the future of payments in the region.

Join us in celebrating excellence and innovation as we honour the recipients of the 2023 MEA Finance Leaders in Payments Awards.

mea-finance.com

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MEA FINANCE LEADERS IN PAYMENTS AWARDS 2023

Best End-to-End Online Payments Processing Systems Provider Checkout.com

Checkout.com was the recipient of the Best End-to-End Online Payments Processing Systems Provider award. The award was conferred to Checkout.com in recognition of the global payments solution provider’s certification by EMVCo for 3D Secure version 2.3.1 – the latest protocol for authentication.

The certification allows Checkout.com authentication to best support merchant needs, using proprietary artificial intelligence to roll out support safely and intelligently.

The latest 3DS protocol aims to directly address some of the biggest pain points of previous protocols, such as reduced payment performance and increased cart abandonment as a result of customer friction.

Checkout.com said the certification comes on the heels of Ubble’s, which was acquired by the payments solution provider last year and it is a continuation of the platform’s multi-product journey as it builds its Payments Plus offering.

The platform’s acquiring licence from the Central Bank of the UAE, collaboration with Mamo, global reach and dedication to the Middle East reflect its commitment to revolutionising the payments sector.

Best Real-Time Payments Provider Infosys Finacle

Infosys Finacle walked away with the Best Real-Time Payments Provider award.

Finacle Payments has been at the forefront of unlocking possibilities in the world of digital and real-time payments for more than eight years now.

The ISO 20022-based, cloud-native and real-time payments services hub, empowers financial institutions to enhance the customer proposition with value-added services and tailored payment offerings for emergent payment rails – real-time, instant or faster payments.

With Finacle, banks can deploy a comprehensive payments engine with rich business functionality that can be delivered on all channels. Infosys Finacle payments solution is helping the bank drive speed and agility, optimise cost and unlock new revenue generation opportunities.

Finacle Message Hub, an open and cloud-native microservices-driven enterprise message transformation hub, processes financial and non-financial messages in real-time, regardless of originating source and format. The hub helps banks redesign their message transformation strategies, drive seamless corporate onboarding and servicing, and help reduce operational expenditure in financial message management.

Best Real-Time Payments Implementation ENBD X by Emirates NBD

Emirates NBD walked away with the Best Real-Time Payments Implementation award.

The Dubai-based bank’s ENBD X enables users to send money like they send a text, in just a few clicks.

The mobile app has transformed the mobile banking experience of hundreds of thousands of customers, accelerating logins by 8x, payments and transfers by 3x, and performance by 6x. The platform allows customers to send money to local bank accounts using IBAN, to international accounts through Western Union or account details or to their contacts by entering the recipient’s mobile number.

ENBD X features include DirectRemit – a service that offers 60-second, free transfers to countries that have a large population-based in the UAE, including the UK, India, Pakistan, Philippines, Sri Lanka and Egypt and Smart Pass authentication – a digital banking security feature that serves as a secure replacement for SMS authorisation codes. The service is especially useful when the mobile number registered with the bank may not be active to receive one-time-passwords through an SMS e.g. when travelling abroad.

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Banking and Finance news in the MEA market

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MEA FINANCE LEADERS IN PAYMENTS AWARDS 2023

Best Digital Overlay Payment Service Provider ACI Worldwide

ACI Worldwide received the Best Digital Overlay Payment Service Provider award in the Middle East, in recognition of the company’s digital overlay services.

The new services enables banks and financial intermediaries to add a range of realtime digital overlay services to support a high-volume, data-rich digital payments ecosystem for consumer, corporate and merchant customers.

The company launched an end-to-end digital central infrastructure solution designed for central banks and financial institutions in September.

The new digital central infrastructure is a single ISO 20022 native solution that offers central banks and financial institutions a one-stop solution encompassing real-time central infrastructure integrated with digital overlays such as request to pay, QR-code payments, back-office management platform and AI-powered anti-fraud technology.

Best Payment Technology Implementation – UAE Mashreq Neopay

Mashreq NeoPay was the recipient of the Best Payment Technology Implementation award, which was conferred to the payment solutions provider in recognition of its ‘Business in a Box’, which is powered by the fintech Nymbl.

Business-in-a-box solution stands as a robust offering for Tier 2 and Tier 3 merchants.

The comprehensive solution not only facilitates seamless payment acceptance but also streamlines inventory management, order processing, restaurant operations and tax billing within a unified platform.

Furthermore, the payments platform’s Cashew buy now, pay later (BNPL) integration on POS terminals simplifies payment acceptance for customers using the Cashew BNPL wallet.

Best Payment Technology Implementation – Saudi Arabia Banque Saudi Fransi

Banque Saudi Fransi was the recipient of the Best Payment Technology Implementation award in Saudi Arabia. The award was presented in recognition of the bank’s implementation of ‘verse’, a corporate marketplace that helps prestigious clients by showcasing the bank’s corporate service providers and fintechs to effortlessly solve their challenges.

With verse, Banque Saudi created a simplified hub to connect partners with clients within the bank to revolutionises the way corporate banking relationships are nurtured, managed, and expanded. The marketplace gives to access to a wide range of banking services, tailored specifically for unique requirements.

Within the payments space, the platform offers 13 different PTSPs that are supporting the bank in the e-commerce business, focusing on simplified corporate client management, extensive service provider Network and enhanced collaboration and efficiency.

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Banking and Finance news in the MEA market

Best User Experience in Payments – UAE Al Ansari Financial Services

Al Ansari Financial Services was the recipient of the Best User Experience in Payments award in the UAE. The Best User Experience in Payments award recognised Al Ansari’s commitment to delivering customer experience through innovative technologies, expanding the branch network and offering exceptional customer service.

The company offers customers more than 70 foreign currencies for exchange and 17 currencies through its multicurrency prepaid TravelCard. Its customer satisfaction rate has consistently remained high and was at 98% in the first half of 2023, as measured through the feedback tablets installed in all our branch counters.

Al Ansari’s digital channel experience has remained best-in-class, with an app store rating of 4.7 out of 5 with more than 126,000 ratings across Google Play and Apple App Store. The company also received several accolades, awards and certifications, which serve as a testament to upholding customer excellence as one of their core values.

The firm’s mobile app is equipped with advanced technology and user-friendly features such as face recognition, biometric access and UAEPASS integration for eKYC.

Best User Experience in Payments – KSA Banque Saudi Fransi Banque Saudi Fransi walked away with the Best User Experience in Payments award in Saudi Arabia. The bank was given the award for its unwavering commitment to excellence with a focus on partnering with specific fintech firms and service providers, each bringing an exceptional corporate user experience.

The bank has partnered with top-tier Payment Technology Service Providers (PTSPs) e-commerce platforms that can quickly onboard clients/merchants, allowing large clients seeking quick and fast integration to receive payments at a faster rate. Banque Saudi has already established fund collection accounts for them and does not need to do any additional work from their side once a new merchant has been onboarded.

Some Banque Saudi’s PTSPs focus on having better reconciliation and settlement processes, ensuring that the payments can be used in real-time instead of being batch-based, while others focus on having better customer service by replying to clients at a faster rate.

Best Cross-Border Payments Technology Provider Smartstream Technologies

Smartstream Technologies received the Best Cross-Border Payments Technology Provider award in the Middle East region. The firm was conferred the award in recognition of its TLM Aurora Advanced Payment Control, a platform that provides a single, integrated solution for financial institutions to track, monitor and investigate all their payments.

It enables banks to automate their exception handling processes, providing a formalised business and communication protocol, delivered through FIN, local FTS, ISO 20022 XML-based messages and the SWIFT gpi tracker API. Advanced Payment Control offers a standardised way of working. Its pre-configured workflows allow the automation of large parts of the exception-handling process, guiding users through the exception lifecycle and virtually eliminating the risk of errors occurring. The tailored workflows not only reduce the potential for error but it improve resolution times – leading to increased efficiency and reduced costs.

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MEA FINANCE LEADERS IN PAYMENTS AWARDS 2023

Landmark Innovation in Cross-Border Payments Award Swift

In recognition of its innovative payments solution that enables simple, low-value cross-border payments for SMEs and consumers, Swift walked away with the Landmark Innovation in Cross-Border Payments award.

Swift Go offers consumers predictability, speed, ease and security. It also allows financial institutions to deliver an outstanding customer experience, remain competitive in a high-growth market and become leaders within the payments industry.

Swift worked with its early adopter community of 12 banks to define Swift Go in January 2021 and since then, the proposition has seen unparalleled growth in adoption. They have grown their community of banks by over 414% since January 2022 and now have over 630 banks signed up, representing 130 countries with most low-value payments on Swift.

Last year, Swift created a new API to help customers deliver better payment predictability without having to develop and perform eligibility checks in-house. The firm also designed a new customer journey for non-gpi banks who can benefit from Swift Go without having to subscribe to gpi.

Best Payments Service Award HPS

HPS was the recipient of the Best Payments Service Award in the Middle East region.

The firm was given the award in recognition of its two innovations - Card as a Service provision, a service that enables corporates to easily develop and launch card services, and their Retailer Open Payment Platform, a platform that allows retail customers to shop by whatever channel they choose, 24/7 while offering a seamless customer journey.

The multinational company’s comprehensive suite of solutions, PowerCARD, covers the entire payment value chain by enabling innovative payments through its open platform that allows the processing of any transaction coming from any channel initiated by any means of payment.

The platform is being used by more than 450 financial institutions in over 90 countries and has offices in the UAE, Morocco, South Africa, Mauritius, Singapore, France and Greece. HPS counts banks, digital banks, fintech companies, national switches, processors, finance companies, retailers and telecom companies among its customers.

Best Open Banking Payments Project First Abu Dhabi Bank

First Abu Dhabi Bank (FAB) was presented with the Best Open Banking Payments Project award. This award recognised FAB’s partnership with Mobile Wallet Client, a leading contactless and cashless mobile wallet and merchant service provider in the UAE. FAB provided Mobile Wallet Client with a combination of Virtual Accounts and APIs to help facilitate the management and reconciliation of the platform’s ‘client money’.

Virtual Accounts allow users to ‘top-up’ their wallet accounts via bank transfers, in addition to existing credit card and kiosk top-up options.

Client also uses Virtual Accounts to maintain the ‘holding’ of merchant settlements, before the actual remittance of proceeds to its registered merchants, as per their agreed turnaround times. FAB developed APIs to ensure that these transactions are updated in Client’s applications as and when these transactions are done. The proposition expanded FAB’s suite of solutions and services offered under the Cash Management division of Global Transaction Banking, giving the bank a unique edge.

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Banking and Finance news in the MEA market

Best Payments Inclusivity Initiative Magnati

Magnati was the recipient of the Best Payments Inclusivity Initiative award. The award honoured Magnati for its unwavering commitment to societal progress through financial inclusion to provide essential financial services to all segments of society.

The payments platform’s NAFIS Payment Card has effectively bridged the financial divide by extending a comprehensive suite of financial services tailored to meet the unique needs of NAFIS a federal program to increase the competitiveness of Emirati human resources and empower them to occupy jobs in the private sector.

The card was introduced to meet the needs of NAFIS, a federal program to increase the competitiveness of Emirati human resources in the private sector, leading to increased job opportunities and thereby supporting economic growth.

Beyond individual empowerment, the Nafis Payment Card has made substantial contributions to the UAE’s economy. Its support for Emirati talents has led to increased productivity and job opportunities for Emiratis, thereby bolstering economic growth.

Best Instant Payments Technology Implementation Commercial Bank of Dubai With a base of more than 1.5 million customers across retail and wholesale banking, Commercial Bank of Dubai (CBD) has grown by 10% in the past year driven by the bank’s best-in-class, state-of-the-art technology-enabled platforms that provide ease of payments across more than 20 corridors.

The bank’s numerous capabilities including omni-channel integration, payment pre-validations and real-time anti-money laundering, registered a 36% increase in instant payments last year.

CBD’s ‘Enterprise Payment Hub’ platform offers a seamless payment experience to its customers. The platform features a centralised payment hub to provide omni channel experience by integrating products and schemes into a single platform, event-driven architecture for payment processing and tracking and real-time integration with Fraud and AML detection.

The payment hub also features a cloud-agnostic solution for ease of scalability and integration and intelligent pre-processing with smart routing and transformation toolkit.

Best Instant Payments Technology Implementation Provider Global Software Solutions Group

Best Instant Payments Technology Implementation Provider award was conferred to Global Software Solutions Group (GSS).

The locally-owned, UAE-based software solutions provider is currently the only tried and tested solution provider having an end-to-end solution for the UAEIPP and was selected to power two of the six pilot 1 banks successfully (and to have taken their customers to soft launch in production).

The company’s customer base now covers all types of participants - large banks, medium-sized banks, finance houses, digital banks and exchange houses and is growing at a rapid pace.

GSS’s vision is aligned with the UAE - partnerships with NPCI (for interoperability between UAEIPP and India’s UPI), and r3 (for interoperability between UAEIPP and CBDC) are being pursued to make UAEIPP truly successful across all its stakeholder participants to enable seamless payments for the UAE population.

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MEA FINANCE LEADERS IN PAYMENTS AWARDS 2023

Best Remittance and Foreign Exchange Service Provider

Al Ansari Exchange

Al Ansari Exchange was the recipient of the Best Remittance and Foreign Exchange Service Provider award in the Middle East.

The award was presented to Al Ansari Exchange in recognition of the company’s unrivalled reputation as a regional leader in this market, backed by performance that includes contributing about 40% of the AED 2.9 billion core operating income of exchange houses and profits constituting 74% of the AED 800 million consolidated net profit for the exchange houses.

In the foreign exchange business, Al Ansari contributed 32% of the AED 1 billion income generated by exchange houses as well as 46% of the AED 1.6 billion income in the remittance business. The firm has opened 15 new branches since the first half of 2022, strengthening its network to an impressive 238 branches across the UAE. Al Ansari’s ongoing expansions in Kuwait and Oman reflect its commitment to growing the firm’s regional footprint, reinforcing its growth-oriented approach.

Overall Best Payments Platform in the Middle East HPS

HPS received the award for the Overall Best Payments Platform in the Middle East. HPS is a trusted partner and serves more than 450 financial institutions in over 90 countries with a strong presence in the UAE, Morocco, South Africa, Mauritius, Singapore, France and Greece.

The firm provides the invisible technology that enables simple, seamless and secure payment transactions so that people can create, share and live. The company is recognised for its flagship payment solution, PowerCARD, a comprehensive and digitalready platform that covers the entire payments value chain by enabling innovative payments through its open platform.

Further, HPS’s PowerCARD-Switch offers value added services involving multiple actor transactions such as dynamic currency conversion, mobile top-up and bill payment.

The company provides services to banks, digital banks, fintech companies, national switches, processors, finance companies, retailers and telecom companies among its customers.

Payments Innovation of the Year – KSA

Banque Saudi Fransi

Banque Saudi Fransi was presented with the Payments Innovation of the Year award in Saudi Arabia. This award was given to Banque Saudi Fransi in recognition of the bank’s partnership with Western Union, which is aimed at providing clients with the fastest and most efficient way to send and receive cash instantly to over 200 countries.

Through FransiPlus and FransiMobile, the bank’s clients are able to instantly transfer money or receive it. The bank also offers Cash Pickup and Account to Account, services that allow customers to transfer money securely. It has made significant improvements to payments over the years, driven by the innovative payment solutions that are being implemented by Saudi Payments and Saudi Central Bank.

The Instant Payment System, a project that was run nationwide to enable retail and corporate clients to instantly transfer money within the kingdom using certain proxies, allows the bank to make transfers of as much as SAR20,000 in a single transaction.

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Banking and Finance news in the MEA market

Payments Innovation of the Year – UAE Commercial Bank of Dubai

Commercial Bank of Dubai (CBD) bagged the Payments Innovation of the Year award in the UAE. The award was given in honour of the bank’s commitment to advance customer experience and provide a seamless process for its customers payments journey.

CBD is cognisant of the fact that cheque payments are still a significant volume of the whole, requiring multiple data points and manual verification on the instrument before finally crediting the customer.

The bank implemented an AI-based cheque clearing system that autonomously validates the cheques efficiently, with an array of salient features providing 100% accuracy to reduce the processing time and enhance automation of processing.

To reduce the processing time and enhance the automation of the cheque processing, CBD implemented an AI based cheque clearing system which provides an autonomous way to validate the cheques efficiently and accurately.

Best Innovation in Payments Technology Arab Financial Services

Arab Financial Services (AFS) was honoured with the Best Innovation in Payments Technology award in the Middle East. This award was conferred to AFS in honour of the firm’s second-generation digital payments solution, AFS Pay. AFS Pay is the first solution in Bahrain to transform Android devices into smart Point of Sale (POS) terminals and eliminates the need for additional hardware, allowing businesses of all sizes to effortlessly accept payments using their own smartphones.

This innovative solution supports contactless enabled Visa and Mastercard cards, enabling businesses to accept a wide range of payment methods, including Contactless Debit and Credit Cards (Tap & Go), NFC Devices like Samsung Pay and Apple Pay, as well as Smart Link payments.

AFS is owned by 37 regional banks and financial institutions including Bahrain’s Bank ABC ( majority shareholder) and Saudi National Bank. The payments firm serves more than 60 clients in over 20 countries across the Middle East and Africa.

Best Payment Gateway Mastercard

CONFERENCE & AWARDS 2023

Mastercard received the Best Payment Gateway award in the Middle East region.

Mastercard has forged partnerships with organisations from diverse sectors and municipalities in the Middle East to help foster environments for the adoption of digital payment solutions in everyday life.

The digital payments firm’s collaborations in Egypt, Saudi Arabia and the UAE are great examples of how the company is supporting the development of country-wide digital transformation. Mastercard partnered with the UAE government to increase artificial intelligence capabilities and readiness in the region.

An initial focus of the effort will be dedicated to battling financial crime, securing the digital ecosystem and driving inclusive growth in the UAE and beyond. Mastercard also partnered with Greater Amman Municipality to enable seamless digital payments across the municipality-operated public transport network, powered by Mastercard’s Payment Gateway Services.

The company’s portfolio of integrated services and solutions is generating new business, deepening customer engagement, driving loyalty, protecting digital systems and creating new opportunities beyond payments.

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MEA FINANCE LEADERS IN PAYMENTS AWARDS 2023

Payments Technology Executive of the Year

Samer Soliman, CEO of Arab Financial Services

Samer Soliman, CEO of Arab Financial Services was the recipient of the Payments Technology Executive of the Year award in the Middle East. Soliman is a payment, consumer finance and banking veteran, who is driving AFS’s digital payments and fintech growth strategy across the Middle East and Africa markets.

For over three decades, he has worked with some of the biggest names in the financial services sector, having started his career at Citibank followed by twenty-one years in Network International, where he held several key posts including Managing Director of their Middle East business.

Soliman has been at the helm of AFS since 2021 and in his comparatively short time at the forefront of the business, he has already led his team in securing numerous successful deals and partnerships across the region and the wider world, including – selecting Singapore-based Brankas in a partnership bringing their established open finance practices to MENA, entering into a strategic partnership with National Bank of Kuwait and launching prepaid business cards in Bahrain and Oman with Visa.

With the company’s executive team, Soliman is continuing the AFS tradition of pioneering new, smart payment solutions and services to the region, including advancing the company’s financial inclusion efforts.

Digital Payments Leader of the Year

Ramana Kumar, Chief Executive Officer of Magnati Ramana Kumar, Chief Executive Officer of Magnati, bagged the Digital Payments Leader of the Year award in the Middle East.

As head of Magnati, a unit of First Abu Dhabi Bank, Kumar is responsible for building lifecycle solutions for corporates encompassing merchant acquiring, government solutions, prepaid solutions, remittances, and UAE’s first fully featured digital wallet -Payit.

He is responsible for building a future-proof payments company driven around the vision of digital-first and works with fintechs and tech companies providing marketleading solutions to drive the best customer experience.

Previously, he was Head of Global Transaction Banking (GTB) in NBAD and was instrumental in building the Middle East regional proposition for the Bank including products and channels across cash, trade and cards.

Ramana has special interests in innovation, fintech, financial inclusion, blockchain and the impact on the payments space. He was instrumental in many “first in the market” initiatives across payments driving digital payments, cashless initiatives, and financial inclusion. The banking veteran has participated in many forums focusing on future payments, financial inclusion, digital wallets, KYC and Identity and fintech/blockchain.

Payments Executive of the Year

Onur Ozan, MD, Regional Head for Middle East, North Africa and Turkiye, at Swift Onur Ozan, MD, Regional Head for Middle East, North Africa and Turkiye at SWIFT was the recipient of the Payments Executive of the Year award in the Middle East.

Ozan is responsible for delivering instant and frictionless payment solutions through payment market infrastructures, banks and fintech companies.

He is a recognised payments expert with more than two decades of experience in regional and global roles within financial services, particularly B2B, B2P, and P2P payments. Onur is passionate about payments, technology, customer value propositions and crafting successful go-to-market strategies.

A people person, enthusiastic about developing and sustaining high-performing diverse teams. Onur is an EMCC (European Mentoring and Coaching Council) accredited coach/mentor actively taking part in corporate mentorship programs.

Prior to his current position, Onur oversaw channel management strategy and solutions sales efforts across the Middle East, Turkiye and Africa.

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Banking and Finance news in the MEA market

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