The Promise of FinTech Iran
All over the world, from New York, London, Hong Kong and Singapore, start-ups are sprouting up to deliver new financial technology (FinTech) to offer online payments, currency exchanges, crowd-funding, online P2P lending and wealth management services that compete with traditional retail and private banking services.
Asia has approximately 2,500 FinTech start-ups, and the UK and US combined have 4,000 FinTech startups. The investment in FinTech start-ups around the world surpasses any other start-up sector by far. Since 2011, more than US$24 billion has been invested in FinTech start-ups worldwide and in 2015, US$11 billion was invested.
Iran & FinTech
Iran stands poised to dominate in FinTech.
Iran has a young population of 75 million people, who are well-educated with significant science and technology global leadership. The basis of FinTech is tech. Unlike many other countries, Iran has an abundance of well-educated tech scientists. Not only that, productivity is significantly higher which is coupled in Iran with lower labour costs compared to Western countries.
Another important benefit of Iran is that it is the largest centre of Islamic finance. Iran, the only Muslim country besides Sudan where the entire financial industry is obliged to be consistent with the principles of sharia law, accounts for more than 40% of the world’s total Islamic banking assets. Trailing far behind is Saudi Arabia with 18.5%, Malaysia with 9.56%, and the UAE with 7.36%. As a result, FinTech in Iran means that it will be poised to lead in Islamic FinTech globally and this has implications for the rest of the world’s banks that are far behind in understanding and catering to Islamic finance customers.
Spending by financial institutions on Blockchain projects is set to exceed $1 billion by 2017, making it the fastest developing enterprise software markets of all time. Iran could begin to attract part of that investment and quickly become a FinTech world leader once its banking system is integrated with the rest of the world.