The total funding provided to startups in the financial services technology sector in the MENA region during the first six months of 2024 amounted to $186 million—a 59% decrease compared to H1 2023.
This decline was primarily driven by the absence of mega deals, which had previously bolstered the sector’s growth, as reported by MAGNiTT. Without accounting for mega deals, the amount of fintech funding raised represented an almost flat 3% year-on-year decrease in funding and a 2% year-on-year decline in deals, the report revealed.
Nonetheless, the sector remained resilient in terms of deal activity, with 50 deals recorded, just one less than H1 2023. Moreover, the sector saw a 31% increase in the number of unique investors during the period, with a 93% year-on-year increase in the participation of international investors.
The fintech sector accounted for 24% of all VC investments during the period.
Saudi Arabia and the UAE topped the list in terms of capital deployment, with the Kingdom showing a remarkable 391% increase in funding, mainly driven by Moyasar, Abyan and SiFi’s key deals.
Additionally, seed valuations did experience significant growth. The mean seed valuation increased by 4% in H1 2024, while the median valuation surged by 70% compared to the same period in 2023. The UAE recorded a 15% increase in deal numbers, primarily driven by growth in seed and Series A funding rounds.
Philip Bahoshy, CEO of MAGNiTT, commented on the findings, stating: “2024 is a year of shifting investor patterns across the Middle East, Africa, and Southeast Asia, yet one trend remains clear: fintech continues to lead in these emerging venture markets mimicking investor appetite at a global level.”
The analysis also revealed that the fintech industry has experienced an approximately 650% growth in regional funding between 2020 and 2023.
