March 2025

CEO2: The Power of One CEO2: The Power of One

Wendy Wang, Founding Management and Group President, Ascentium and George Hojeige, CEO, Virtuzone

ROADMAP TO EMBARK ON THE GLOBAL HORIZONS

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Business Matter

Energy is a property of matter, and the most heralded result of the nuclear fusion of matter is that the output is greater than the input; natures’ example of something being greater than the sum of its parts. There is no shortage of analogies or metaphors to use in celebrating the current dynamic regional business environment and on balance this is a good thing, and as you probably suspect, this is exactly what I am building up to. So here you are.

Inside we examine several heated and expanding sectors, but where the metaphor of the month comes to the fore in this, the March 2025 edition of MEA Finance, is in relation to our cover story featuring George Hojeige, CEO of Virtuzone and Wendy Wang Founding Management and Group President at Ascentium. The interview tells us the hows and whys of the recent acquisition by Ascentium of Virtuzone and how this will bring greater energy and added dimensions to the regional business landscape; a real life working example of an outcome that is greater than the sum of its parts.

The energy behind the expansion of wealth management and private banking is looked into once again. This sector of the regional banking and finance markets shows no sign of resting in its inexorable journey toward becoming a leading global wealth centre – “We anticipate regional booking centres in the Middle East to rank higher by 2030”, says Saad Osseiran, Head of Private Bank Middle East at Deutsche Bank.

The long established but ever energetic fusion of technology and banking is enthusiastically debated in our coverage of the MEA Finance and Infosys Roundtable that took place on the 6th of February. With the theme

- Driving Digital Transformation for Financial Services, go to page 54 to hear from the array of regional banking technology heavyweights present at this informative and enjoyable event.

The never-ending energy of innovation in the realm of payments is examined this month, where we hear from SAB, Careem Pay and Rak Bank, all contributing from their particular perspectives in the regional payments landscape – “Payments innovation is far from reaching its peak,” asserts Pradeep Negi, SVP Payments and Compliance, Portfolio Delivery, RAKBANK. The banking technology contribution from Infosys this month also focuses on payments and the trends shaping the financial landscape. Then Kartik Taneja Payments and Consumer Lending, Mashreq and Chairman of NEO PAY, provides opinion on the trifecta of benefits around contactless payments - speed, convenience and protection.

Between our pages we take an interesting look at the fast evolving activities of AI in the industry, where the arrival of Agentic AI heralds an age of autonomous decision making for the machines that are now becoming our colleagues.

The narrative mass increases further with Sebastian W. Graewert, Senior Executive Officer at The Mauritius Commercial Bank, detailing their role in linking the Middle East with Africa. Then Dr. Bernd van Linder, CEO, Commercial Bank of Dubai shares insights into how the Bank is navigating global macroeconomic challenges while advancing digital strategy, and Fernando Morillo, Global Head of Retail Banking, Mashreq points to the unique regional characteristics creating growth for banks.

Finally, our monthly market focus is on Iraq whose undoubted challenges are being faced by moves to improve the economic climate with non-oil investments.

So, however you choose to fuse with this month’s dense and powerful content, we are sure it will amount to intellectual energy most well applied.

Mashreq introduces ‘Mashreq Biz,’ a game-changer in digital banking for SMEs

Mashreq has successfully launched Mashreq Biz, a next-generation online and mobile business banking platform designed to simplify and enhance the banking experience for businesses

Mashreq Biz launch brings advanced digital banking tools to SMEs in the UAE.

Offering an intuitive, easyto-navigate interface, Mashreq Biz empowers SMEs and business owners to manage their finances, payments and transactions seamlessly from the comfort of their office or home, transforming day-to-day business operations into a streamlined, efficient process.

With SMEs constituting over 94% of active enterprises in the UAE, employing 42% of the workforce and contributing 40% to the national GDP, these businesses are pivotal to the country’s economic diversification and growth. As of mid-2022, the UAE had approximately 557,000 SMEs, contributing 63.5% to the non-oil GDP, with projections indicating this number will reach 1 million by 2030.

Aligned with the growth of the SME sector in UAE, Mashreq is advancing the digital transformation of over 70,000 existing NEOBIZ and Business Banking customers by introducing the ‘Mashreq Biz’ platform. Launched in 2019, NEOBIZ was the first digital banking proposition in the UAE specifically designed for SMEs.

Rajeev Chalisgaonkar, Group Head of Business Banking, Mashreq

The Mashreq Biz platform builds on this foundation, offering even more advanced features that cater to the dynamic needs of SMEs. This strategic enhancement underscores Mashreq’s commitment to maintaining its leadership as a digital innovator and emphasises its role as a pivotal player in the regional banking industry.

Rajeev Chalisgaonkar,

Group Head of Business Banking, Mashreq,

added “The launch of Mashreq Biz signifies a major leap in our commitment to support SMEs. By providing a platform that not only simplifies operations but also boosts productivity, we are setting a new benchmark in business banking. Mashreq Biz is meticulously crafted to align with the diverse needs of our customers across various sectors, ensuring that it serves as a robust partner in their growth journey. Several of our SME customers participated in the designing and testing of Mashreq Biz, and we sincerely thank them for their insights and their feedback which helped us deliver a platform that addresses the real-world needs of modern SMEs and improves their competitiveness.”

The introduction of Mashreq Biz is a significant step forward for business banking, offering a wide range of services that enable businesses to access banking solutions anytime, anywhere. Key features of this state-ofthe-art platform include an integrated dashboard for a complete relationship overview, instant foreign currency account openings, bulk payments and deposit bookings at preferential rates. With additional functionalities such as workflow approvals, multi- user management and value-added services, accessible on both web and mobile, Mashreq Biz promises to redefine convenience and efficiency for business banking customers.

Invest Bank expands Digital Trade Finance through partnership with Veefin Solutions

Veefin Solutions will implement an advanced Supply Chain Finance system for Invest Bank, designed to enhance financial services for businesses by optimising cash flow, risk management and working capital efficiency

Invest Bank announced a strategic partnership with Veefin Solutions to introduce cutting-edge digital trade finance solutions for businesses across the UAE. Through this collaboration, Invest Bank will implement advanced Supply Chain Finance (SCF) solutions, designed to optimise cash flow, enhance working capital efficiency and streamline receivables and payables management via specialised open account finance products.

Deploying the SCF system is particularly crucial given the rapid expansion of businesses in the UAE. As of mid-2024, the country is home to 1.021 million registered enterprises, including over 550 fintech companies. Additionally, SMEs are projected to reach one million by 2030, reinforcing the need for seamless, technology-driven financial solutions.

Sharjah significantly contributes to the UAE’s startup ecosystem, hosting approximately 60,000 small to mediumsized enterprises and startups valued at $424 million across six free zones and 33 industrial zones. Considering formal SMEs account for 40% of national income and generate roughly seven out of every 10 jobs, highlighting their economic significance.

Edris

Al Rafi, Chief Executive Officer at Invest Bank

Edris Al Rafi, Chief Executive Officer at Invest Bank said: “With our strategic partnership with Veefin, Invest Bank is poised to leverage Supply Chain System to redefine the landscape of open account finance. This collaboration not only strengthens our position in competitive markets but also enhances our risk management framework and elevates client service standards. By integrating cutting-edge financial technology, we are driving a transformative shift in our digital strategy, empowering businesses with seamless financial solutions while reducing dependency on traditional banking infrastructure.”

The new Supply Chain Finance (SCF) system enhances financial management by enabling businesses to optimise cash flow with greater flexibility. Clients can choose between early payment discounts or extended payment terms, ensuring liquidity remains aligned with their operational needs. Additionally, the system enhances risk management by providing greater visibility and realtime control over the financial health of suppliers and buyers, enabling smarter, data-driven decision-making. By reducing the time gap between payables and receivables, the SCF solution further improves working capital efficiency, ensuring smoother operational liquidity and sustainable business growth.

Gautam Udani, Co-Founder and Chief Operating Officer at Veefin Solutions, said: “We are glad to support Invest Bank in its mission to digitise Supply Chain Finance. Our platform will help replace legacy manual systems with an intuitive, fully automated digital solution, ensuring faster approvals, better transparency and a superior user experience for businesses seeking financing.”

Invest Bank’s partnership with Veefin Solutions represents a strategic milestone in digital transformation, reinforcing customer-centric innovation through cutting-edge banking solutions. This collaboration accelerates the bank’s transition to a more integrated and seamless customer experience, enhancing service speed, reliability and operational efficiency. Additionally, the partnership strengthens Invest Bank’s role in driving Sharjah’s economic growth and fostering community engagement.

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Determination to Progress

While Iraq’s undoubted challenges are well understood, Prime Minister al-Sudani’s government has moved to boost the investment climate, with non-oil investments on the increase and key parts of the banking sector possessing significant growth potential

Iraq’s President appointed Mohammed Shia al-Sudani as the country’s new Prime Minister in October 2022, breaking a yearlong political stalemate and ushering in a new era aimed at addressing numerous pressing issues ranging from a beleaguered economy to unemployment to deteriorating infrastructure and widespread corruption.

Al-Sudani wasted no time in addressing Iraq’s challenges, describing the country’s corruption crisis as “more deadly than COVID-19.” He attributed the oil-rich nation’s economic struggles and the erosion of state authority to this pervasive corruption, signalling his determination to tackle the problem head-on.

Iraq is currently enjoying a phase of relative stability; even as geopolitical tensions persist across the Middle East. Sustained high oil prices in recent years have provided Al-Sudani’s government with financial muscle to prioritise infrastructure development and steer the country away from the cycles of conflict that have plagued it for decades.

The International Monetary Fund (IMF) said that domestic stability has strengthened since the new government assumed power in October 2022, enabling the approval of Iraq’s inaugural three-year budget.

The IMF stressed that the budget marked a significant fiscal expansion beginning in 2023. This year, the fund projects GDP to rise to 5.3%, up from 1.4 in 2024.

Iraq’s economic narrative has long been intertwined with its abundant oil reserves. Despite record oil revenues and the passage of a long-awaited budget, the World Bank warns that Iraq risks missing a key opportunity to implement overdue reforms. The reforms are essential to stimulate private sector growth and generate the millions of jobs required over the next decade.

Meanwhile, a robust banking sector is pivotal for economic development, facilitating investment and fostering private sector growth. Iraq’s banking system has historically faced challenges, including limited financial inclusion, outdated infrastructure and a lack of public trust.

Recognising these issues, the Central Bank of Iraq has embarked on reforms aimed at modernising the sector, including working with the US Treasury Department to bolster anti-money laundering and countering the financing of terrorism (ALM/CFT).

Lifeblood of Iraq

Iraq’s economy has been inextricably tied to its oil reserves, the secondlargest OPEC producer after Saudi Arabia with the world’s fifth-largest proven oil reserves, amounting to 145 billion barrels. The oil sector has been the backbone of the economy, providing the government with the funds needed to rebuild infrastructure, provide public services and stabilise the country after decades of conflict.

The country’s economic outlook is heavily reliant on the oil sector, which makes up over 99% of its exports,

85% of its government budget and 42% of its GDP. Consequently, the IMF’s growth projections could be undermined by a potential decline in oil prices in 2025 – a trend that is increasingly anticipated due to repeated OPEC+ forecasts of slowing global oil demand growth for this year and the next.

OPEC+ agreed earlier in February to continue its policy of gradually increasing oil production starting in April despite calls from US President Donald Trump called on the group to lower crude prices. Iraq, along with several other OPEC+ members, has had difficulties adhering to production cuts agreed by the alliance earlier last year, but has made significant strides in improving their compliance in recent months.

Earlier in January, Iraq discovered a massive oil field that is expected to significantly increase the country’s hydrocarbon reserves. The field, located in the central part of the country, contains more than 2 billion barrels of medium and light crude oil, with a projected daily output of 5,000 barrels.

However, Iraq’s heavy reliance on oil revenues exposes the country to external shocks. The volatility of global oil prices, as seen during the COVID-19 pandemic and the subsequent recovery, has underscored the risks of an undiversified economy. For instance, in 2020, when oil prices plummeted to historic lows, Iraq’s economy contracted by 10.4%, according to the IMF, strikingly highlighting the need for economic diversification.

“Reducing oil dependence and ensuring fiscal sustainability while protecting critical social and investment spending will require a significant fiscal adjustment, focused on controlling the public wage bill and increasing non-oil tax revenues,” said the IMF.

Meanwhile, a top economic adviser to Prime Minister al-Sudani issued a warning last September that Iraq faces a potential budget crisis in 2025 due to falling oil prices, the overwhelming source of government revenue.

Iraq increased its budget in 2024 even after record spending in 2023 when more

REDUCING OIL DEPENDENCE AND ENSURING FISCAL SUSTAINABILITY WHILE PROTECTING CRITICAL SOCIAL AND INVESTMENT SPENDING WILL REQUIRE A SIGNIFICANT FISCAL ADJUSTMENT, FOCUSED ON CONTROLLING THE PUBLIC WAGE BILL AND INCREASING NON- OIL TAX REVENUES

– the International Monetary Fund

than half a million additional employees were hired into the already hugely staffed public sector and a capital-intensive nationwide infrastructure modernisation effort.

The oil-rich nation’s recent budget update is far more complex than it appears on the surface. The 2025 budget reflects Iraq’s ongoing fiscal challenges amid declining oil prices. While the 2024 budget rose to $161 billion (IQD 211 trillion) from IQD 199 trillion the previous year, maintaining a projected deficit of IQD 64 trillion, the 2025 budget necessitates stricter financial discipline.

“We forecast the budget deficit to widen to 8% of GDP in 2024, from 2% in 2023, and to an average of 12.4% over 2025/26,” Fitch Ratings said while affirming Iraq’s B- rating, citing the country’s heavy dependence oil, weak governance and high level of political risk.

The authorities in Baghdad have prioritised paying salaries and pensions to maintain social stability, as these expenditures account for over 40% of the budget. To strengthen finances, Iraq aims to increase non-oil revenues through improved tax collection, addressing issues such as tax evasion and customs inefficiencies, which currently result in an estimated loss of $10 billion annually.

Concerns for the 2025 budget reflect a challenging global oil market. Since mid-2022, oil prices have been steadily declining, with Brent crude, the international benchmark, dropping from over $120 per barrel to below $75 in recent days.

Fitch projected that Iraq’s revenue will average 34.1% in 2025/26 as lower oil prices more than offset higher output and as the authorities have limited flexibility to raise non-oil revenues.

A path to resilience

More than two decades after the start of the Iraq war, the country is on the path to finding its place on the global investment map. Since assuming power, Prime Minister al-Sudani’s government has taken steps to improve the investment climate, including streamlining business regulations, offering tax incentives, and establishing special economic zones. Foreign investment has played a pivotal role in Iraq’s economic recovery and growth. The latest data from fDi Markets shows that inbound FDI over the first nine months of 2023 hit a record $24 billion, more than double the previous full-year record in 2008.

Over the years, Saudi Arabia, Qatar and the UAE set out to strengthen economic ties with Iraq. Saudi Arabia set aside $3 billion for investment in Iraq via its Public Investment Fund in 2023. Later, the kingdom unveiled a $1 billion mixeduse project, including offices, shops and more than 6,000 residential units.

Earlier this year, Iraq invited Saudi Arabian utilities giant ACWA Power to finalise an agreement for the construction of a 1,000-megawatt (MW) solar energy plant in the Central Najaf governorate.

Last April, UAE’s AD Ports Group signed a preliminary agreement with the General Company for Ports of Iraq to develop Al Faw Grand Port and its economic zone. The deal covers the potential investment, management and operation of ports, economic zones and related infrastructure in other cities in Iraq.

The two entities agreed to set up a joint venture to develop the new facilities while exploring investment opportunities and conducting feasibility studies related to ports, economic zones and other infrastructure under the General Company for Ports of Iraq.

Similarly, Masdar plans to develop a 1 gigawatt (GW) solar project in Iraq, which would be the first phase of a potentially larger project. Four solar parks will be built in the first phase of the project, including a 450 MW park in the Dhi Qar governorate, a 350 MW park in Anbar, a 100 MW park in Maysan and a 100 MW park in Nineveh.

Qatar’s Emir visited Baghdad in June 2023, during which Estithmar signed MOUs worth $7 billion to develop two new residential cities, five-star hotels and deals to manage and operate hospitals. The Gulf state took a 25% stake in TotalEnergies’ $27 billion Gas Growth Integrated Project (GGIP) in 2023. The energy project seeks to develop oil production and capture gas in Iraq, which is currently flared.

Last October, QatarEnergy agreed to acquire a 50% stake in TotalEnergies’ solar power project in Iraq, which is part of the GGIP.

While the oil and gas sector dominates Iraq’s FDI landscape, there has been a noticeable increase in foreign investments in non-oil sectors, such as telecommunications, construction and renewable energy.

However, security concerns, bureaucratic inefficiencies and corruption remain significant barriers with the World Bank’s Ease of Doing Business Index, ranking Iraq 172nd out of 190 countries, underscoring the need for further reforms.

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– Fitch Ratings

A foundation for growth

The banking sector in Iraq has undergone significant transformation in recent years, playing a crucial role in supporting economic growth. Historically, the industry has been underdeveloped, with limited access to financial services and a high reliance on cash transactions.

However, reforms aimed at modernising the financial system have begun to yield results. The Central Bank of Iraq (CBI) has implemented policies to expand access to banking services, particularly in rural areas.

Iraq’s central bank raised the minimum paid-up capital requirement for banks by 60% in August 2023, setting the new threshold at $307.7 million. Commercial banks, many of which are small, had until the end of 2024 (December 31 st ) to meet this new requirement either by injecting the necessary additional capital or submitting a merger and acquisition plan by January 1st, 2025.

“The government’s capacity to support the banking system is limited. We think Iraq’s capacity and willingness to support failing domestic banks during a crisis is limited and uncertain,” S&P Global Primary Credit Analyst Puneet Tuli said in a report, adding that the two largest state-owned banks are, reportedly, undercapitalised and have not been restructured in the past 20 years.

Iraq’s Islamic banking sector possesses significant long-term growth potential, driven by the country’s predominantly Muslim population and low levels of banking penetration. “Islamic banking assets

have grown strongly in recent years, to a 9.7% market share at end-2023 (2022: 8.15%) and $15.1 billion (IQD 19.81 trillion) total assets,” said Fitch Ratings.

Meanwhile, despite robust foreign exchange earnings from oil exports, the Iraqi market has experienced limited US dollar supply.

The scarcity stems from increased scrutiny over dollar access through CBI auctions and US restrictions on several Iraqi banks, barring them from conducting dollar transactions to curb the potential flow of the greenback to sanctioned neighbouring countries.

CBI expanded its ban on US dollar transactions to eight more Iraqi banks in January 2024, citing compliance issues related to these transactions, primarily international transfers. While the banks are still permitted to operate in other currencies, including the Iraqi dinar, the latest action brings the total number of banks facing this restriction to 32, including 19 domestic Islamic banks.

Fitch Ratings said the ban, which is being implemented in collaboration with the US Treasury, severely weakens the banks’ business, risk and financial profiles while creating exceptionally high credit, market and operational risks.

Iraq’s journey toward economic diversification and resilience is far from complete, but the progress made in recent years is undeniable. By reducing its heavy reliance on the oil industry, modernising its financial sector and attracting foreign investment, Iraq is laying the groundwork for a more prosperous future.

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Instant Gratification

The rollout of real-time, instant payment systems across the GCC, while delivering substantial benefits to both businesses and consumers, fostering financial innovation and creating new opportunities, is also placing the region among the leaders in the world of payments modernisation

The GCC payments industry is undergoing a seismic shift as consumers increasingly adopt digital transactions over cash. From the adoption of ISO 20022 standards to Swift’s strategic initiatives and the rise of real-time payment platforms, both supportive regulations and innovative industry initiatives are playing key roles in this transformation.

KPMG said these elements are catalysts for payment modernisation as financial institutions look to grow and strategically position themselves, now and in the future.

“The rapidly evolving payments landscape is accelerating the pace of change in the banking industry, creating unprecedented opportunities for growth and innovation.”

While regulatory mandates are driving many of the changes in the GCC payments ecosystem, other factors, such as the

shift from a cash-based economy to a digital one, are also playing a significant role. The transition, fuelled by consumers’ increasing demand for flexible and seamless payment solutions, is creating substantial growth opportunities for banks and payment service providers alike.

“Transformative change is sweeping through the financial sector of one of the world’s most historically significant regions. It’s a story of technological leapfrogging, cultural adaptation and economic reinvention, all centred around real-time payments,” according to ACI Worldwide report.

Modernising payment systems is a crucial undertaking for economies worldwide. Globally, more than 85 jurisdictions on six continents support real-time payments, ensuring immediate fund availability to beneficiaries and can be used on a 24/7/365 basis, providing a reliable and efficient system.

A study by ACI Worldwide revealed that the Middle East is the fastest-growing real-time payments market globally, with transactions expected to grow at a CAGR of 28.8% from 855 million in 2023 to 3 billion by 2028.

A connected financial ecosystem is vital to improving economies and advancing financial inclusion. Swift, the global financial messaging network, is leading the charge in revolutionising crossborder payments through the adoption of ISO 20022 and the implementation of its Cross-Border Payments and Reporting Plus (CBPR+) programme.

The initiatives are driving the transition toward real-time, frictionless and data-enriched cross-border transactions, setting new standards for efficiency and transparency in global financial communications.

Meanwhile, integrating artificial intelligence (AI) in payments offers businesses vast opportunities, including streamlining operations, reducing costs and delivering personalised experiences to customers. AI is poised to revolutionise the payments industry by enhancing personalisation, bolstering security and streamlining digital transactions. The transformative potential will benefit both businesses and consumers.

The future of the GCC payments landscape hinges on a diverse ecosystem of different forms of value, models, networks, providers and technologies that will continue to expand and coexist.

A

new payments era

GCC domestic payment infrastructures

– including instant payment systems such as Saudi Arabia’s Sarie and the UAE’s Aani, domestic card schemes such as Mada and Jaywan and local digital wallets such as stc pay (now bank), Barq and Hala in Saudi Arabia as well as e& money and du Pay in the UAE – offer faster, locally tailored payments backed by strong regulatory support.

“While the evolution in payment systems continues at pace across the globe, core objectives are becoming evident: to interconnect countries and regions, to adopt best practices, to set standards and to meet consumer expectations,” David Shinkins, Managing Director, Global Head of Cash Management Sales at Barclays said in a blog post.

“The GCC region is no exception, with a focus on real-time capability, resilience and standardisation driving advancements in their payment landscape.”

The UAE central bank, through its subsidiary Al Etihad Payments, launched Aani, an instant payment platform, in October 2023. The instant payments initiative, a key component of the central bank’s Financial Infrastructure Transformation (FIT) program, is expected to significantly boost the adoption of digital payments in the UAE, ushering in a new era of fast, secure and frictionless transactions.

“Real-time payments have become ingrained in the fabric of the payment landscape and have spawned new expectations and demands from businesses to their financial services providers,” according to BNY’s The Current State of Play of Emerging Payments report.

Aani, the UAE’s instant payment platform, has seen explosive growth in 2023. Transactions soared to 64.1 million, a significant jump from the 38.3 million transactions in 2022. The total value of the transactions soared to a record AED164.7 billion in 2023 compared to AED101.2 billion the previous year.

Beyond the UAE’s Aani, other GCC states have launched similar initiatives.

Bahrain utilises FAWRI+, Saudi Arabia employs SARIE and Oman, Kuwait and Qatar all launched their instant payment schemes in 2023. The widespread adoption of real-time payments across the region underscores a strong push towards instant payments and the broader digitisation of financial services.

“The contributions from real-time payments to Bahrain’s GDP are expected to rise from $537.0 million in 2023 to $677.6 million by 2028, 1.32% of formal GDP or equivalent to the output of 12,500 workers,” according to ACI Worldwide.

Similarly, Qatar’s payments industry is set for notable growth, with total revenues projected to hit the $4.15 billion mark by 2028, according to Boston Consulting Group (BCG).

Three key instant cross-border payment initiatives have been launched in the region: Project Aber, a joint digital currency between Saudi Arabia and the UAE; the Buna payment platform, enabling multicurrency transactions for Arab Monetary Fund members and the AFAQ system, linking the real-time gross settlement (RTGS) systems of the six GCC nations.

“Cross-border transaction volume may not outnumber domestic payments, but they are often critical and highvalue payments. As the volume of cross-border payments grows, there will be a greater need to accelerate innovation and capabilities for these payments,” said BNY.

Real-time payments are transforming the Gulf region’s payment landscape by eliminating the delays and inefficiencies inherent in traditional systems, paving the way for innovative business models and previously unthinkable applications.

Setting a new standard

GCC banks are leading the charge in adopting Swift’s ISO 20022 standard. The new transaction format necessitates a significant overhaul of incumbent banks’ legacy systems, which operate across fragmented external markets and internal IT infrastructure.

“The ISO 20022 messaging standard continues to gain momentum as more and more clearing and settlement mechanisms adopt the new ISO 20022 standard,” Celent said in a report, adding that payment modernisation enables banks to break free from legacy technology infrastructures and accelerate the evolution of their payments businesses to meet today’s demands.

The migration to ISO 20022, which began in 2022 and is set to be fully implemented by November 2025, is a critical step toward enabling real-time cross-border payments. Through the standardisation of the way payment messages are formatted and transmitted, the standard eliminates inconsistencies and inefficiencies that have long plagued cross-border payments.

“The Middle East is transforming its payment landscape with ISO 20022 and instant payments. Not only does this align with global standards, but ISO 20022 enables efficient, transparent and secure transactions, fostering financial inclusion and economic growth,” said Sashi Mundhra, the Head of Solution Consulting – EMEA at Volante Technologies.

Unlike older standards, ISO 20022 is designed to carry richer, structured data, enabling greater automation, improved compliance and enhanced customer experiences.

“Native ISO 20022 offers a unique opportunity to create a modern, interoperable and global payment infrastructure, with a richer messaging set enabling faster, safer and more innovative payment services that can be delivered cost-effectively by banks and fintechs alike,” according to EY.

For real-time cross-border payments, ISO 20022 is a game-changer. It supports endto-end data exchange, allowing financial institutions to include detailed remittance information, such as invoice details, tax information and payment purpose codes, directly within payment messages.

Meanwhile, in addition to the adoption of ISO 20022, Swift’s CBPR+ programme aims to standardise the implementation

of the new messaging standard across borders. CBPR+ ensures that financial institutions worldwide can seamlessly exchange ISO 20022 messages, regardless of their internal systems or regional differences.

The combination of ISO 20022 and CBPR+ is driving the global financial industry closer to the reality of real-time cross-border payments. While real-time domestic payment systems, such as the UAE’s Jaywan and Saudi Arabia’s Mada, have already gained widespread adoption, cross-border payments have lagged due to the complexity of coordinating multiple jurisdictions, currencies and regulatory frameworks.

Swift’s initiatives are addressing these challenges by creating a unified, standardised framework for cross-border transactions. ISO 20022’s richer data capabilities enable financial institutions to offer enhanced digital services, improve compliance and boost automation. The standard is also capable of driving product innovation in areas such as enhanced reporting, automated reconciliation and real-time cash flow forecasting.

Swift said that more than one million ISO 20022 messages are now being sent over its network each day in ISO 20022 format, as of December 2024, to 220 countries and territories worldwide. The financial services sector is poised to unlock new levels of efficiency and innovation in cross-border payments as ISO 20022 adoption is on the increase.

Beyond ISO 20022, Swift plans to unveil a new platform in the next one to two years to connect the wave of central bank digital currencies (CBDC) now in development to the existing finance system. With as much as 90% of central banks exploring digital currencies, Swift’s scaled interlink solution will offer banks a single global connection point for digital asset payments, eliminating the need for thousands of individual counterparty connections.

Future of AI in payments

AI is revolutionising the GCC payments landscape by automating tasks such

TRANSFORMATIVE CHANGE IS SWEEPING THROUGH THE FINANCIAL SECTOR OF ONE OF THE WORLD’S MOST HISTORICALLY SIGNIFICANT REGIONS. IT’S A STORY OF TECHNOLOGICAL LEAPFROGGING, CULTURAL ADAPTATION AND ECONOMIC REINVENTION, ALL CENTRED AROUND REAL-TIME PAYMENTS

– ACI Worldwide

as cashflow forecasting, offering valuable insights into industry trends and enhancing security through account validation and fraud management.

“With the use of AI expanding rapidly throughout the business environment, banks have a host of opportunities to employ the technology for faster processing of commercial and consumer payments, global treasury management and improvement of internal processes,” said Grant Thornton.

AI’s potential in finance extends beyond automation and efficiency gains. Forward-thinking financial institutions are leveraging AI as a transformative tool, integrating it into core strategies. The use of AI is not just to streamline operations but to drive revenue growth, create competitive advantages and improve both customer and employee satisfaction.

“AI presents many opportunities for treasurers and broader payments leaders. It can help automatically create insights such as cashflow forecasting while fortifying payments with account validation and fraud management,” JP Morgan said in a blog post.

The rise of GenAI in 2023 has captured the attention of the financial industry, prompting banks to explore its potential and sparking discussions about its revolutionary impact on payments.

“GenAI has the potential to revolutionise payments with a multifaceted approach by boosting personalisation and security

and increasing the efficiency of digital payments, thus benefiting both businesses and consumers alike,” said PwC.

AI offers substantial benefits to the payments industry, including enhanced fraud detection, personalised user experiences and improved operational efficiency. However, its adoption also presents inherent risks related to data privacy, bias, transparency and security.

“New use cases for AI in the payments domain require careful consideration as organisations try to balance the privacy and inclusivity concerns against the raw potential it holds,” according to Mastercard’s whitepaper titled What’s next for real-time payments? Navigating the next wave of adoption.

The implementation of AI, particularly GenAI, requires significant investment and can disrupt existing workflows, procedures and roles. However, despite the challenges, the driving forces behind the adoption of the technology in payments are focused on making payments more efficient, secure, customer-centric and innovative.

The GCC payments landscape is transforming rapidly, fuelled by technological advancements, diverse payment options and a dynamic market shaped by both new players and regulatory oversight. The increasing demand for real-time payments is raising consumer expectations for faster, more convenient transactions, requiring market infrastructures to adapt and innovate quickly.

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Payments in Progress

Victor L . Philippe Chatenay Virtual Assets Program Lead, Innovation Banking at Saudi Awwal Bank – SAB, provides a Saudi Arabian perspective on the leading movements that are currently top of mind for those at the forefront of the developing regional payments scene

November of this year marks the deadline for banks to be ISO20022 compatible. Will all regional banks make this deadline? With the SWIFT-mandated transition to ISO 20022 for cross-border payments by the end of 2025, Saudi banks are progressing toward compliance.

Currently, 84% of banks, including major institutions like SAB, are aligning with the new standard. However, 16%—primarily smaller and startup banks—are not yet on track. For those lagging, SWIFT will provide support but will also impose charges to facilitate their transition.

It is important to note that SWIFT is not mandating full adoption of all ISO 20022

standards immediately, but only those related to cross-border payments. The primary challenge in adoption lies in the richer data format, which disrupts existing payment systems. To mitigate this, Saudi banks will continue using their current message content while mapping it to the new format. While this approach means many data fields will initially remain empty, it ensures minimal disruption to existing systems and customer operations.

Going forward however, cross-border transactions will gradually adhere to the new ISO 20022 format. In the first instance, we expect Saudi banks to be able to include additional information within payment messages without requiring extra input from customers. However, as data requirements evolve, banks may eventually need to collect more details from customers. This shift will be implemented gradually to avoid disrupting customer relationships and ensure a seamless transition to the enhanced messaging standard.

Despite these challenges, ISO 20022 presents significant opportunities for Saudi banks. A key benefit is its alignment with the G20’s commitment—endorsed under Saudi Arabia’s presidency in 2020— to enhance cross-border payments by 2027. Compliance with the new standard will be a critical step toward meeting this global objective as the enhanced data structure allows for greater transparency, automation and efficiency.

Victor L. Philippe Chatenay, Virtual Assets Program Lead, Innovation Banking, Saudi Awwal Bank - SAB

What developments can we expect from the Saudi payments sector in the coming years?

Saudi Arabia has a young, digitally savvy population, making it a prime market for innovative payment solutions. According to SAMA, cash usage has declined significantly, with digital transactions surpassing 60% of all payments. Government-backed initiatives under Vision 2030, such as SADAD, mada and the instant payments system Sarie are

investment and strategic partnerships. STC Pay, now a licensed digital bank, is setting a precedent for mobile-first banking, while Al Rajhi Bank and SNB are rolling out fintech partnerships and digital-first services. With the backing of SAMA’s open banking program, banks are integrating standardised APIs to offer embedded finance solutions, such as instant payments through e-commerce platforms or automated expense management tools for SMEs.

WITH FINTECHS DRIVING INNOVATION AND BANKS ACCELERATING THEIR DIGITAL TRANSFORMATION, THE COUNTRY IS POISED TO BECOME A REGIONAL LEADER IN PAYMENTS INNOVATION

driving modernisation efforts, fostering an environment where digital payments are increasingly the norm.

Much like in other jurisdictions, fintechs have been quicker to meet the shifting consumer expectations toward faster and more convenient financial services. While Saudis are accustomed to instant messaging, one-click e-commerce and seamless mobile experiences, traditional bank apps often remain cumbersome. This has opened the door for fintechs like Tamara and Tabby, which embed Buy Now, Pay Later services at online and offline checkouts, providing a frictionless shopping experience. Additionally, the introduction of Saudi Arabia’s open banking framework, which supports the secure sharing of financial data, is fueling the rise of fintech players like Tarabut Gateway, Lean Technologies and Rabet, who are enabling financial innovation across the MENA region.

In the coming years however, we can expect banks to close the gap via heavy

In conclusion, Saudi Arabia’s payments sector is evolving rapidly. With fintechs driving innovation and banks accelerating their digital transformation, the country is poised to become a regional leader in payments innovation.

The UAE recently authorised the first stablecoin issuer in the country. Do you foresee the regulatory framework in Saudi Arabia also expanding to virtual assets? Virtual assets present a significant opportunity to improve fund transfers both locally and internationally. Today’s financial networks operate through a fragmented system of siloed banks and payment infrastructures. Virtual assets, underpinned by Distributed Ledger Technology (DLT), offer a more unified, efficient and transparent network, enabling real-time settlement, lower operational costs and streamlined liquidity management.

Despite these benefits, adoption

faces regulatory challenges. Like other jurisdictions, regulatory certainty remains a key issue in Saudi Arabia. SAMA, conscious of both the risks and potential benefits of digital assets, has taken a learning-throughexperimentation approach. Last year, the central bank joined the mBridge project—an international Central Bank Digital Currency (CBDC) initiative with China, Hong Kong, Thailand and the UAE— to explore how blockchain could enhance cross-border payments.

This initiative, along with ongoing discussions with Saudi banks, reflects SAMA’s commitment to understanding digital assets’ risks and opportunities. These insights will likely shape future regulatory developments and determine whether Saudi banks can integrate virtual assets into their services. However, unlike the UAE’s stablecoin authorisation, we expect initial Saudi use cases are expected to focus on wholesale and corporate transactions rather than smaller retail ones. Given the Kingdom’s existing instant payment infrastructure—such as SADAD, mada and Sarie—there is less urgency for consumer-facing stablecoin payments, with the benefits this would bring over the existing systems unclear.

Beyond regulation, there is a strategic challenge for banks to adopt virtual assets, which is identifying where this technology fits within the broader and increasingly complex payment landscape, including embedded finance, Banking-as-a-Service, open banking and AI-driven solutions. As banks increasingly invest in these technologies, the ROI and value realisation from diverting some budget to virtual asset capabilities must be clear.

We expect that, as regulatory clarity improves and valid use cases are identified via experimentation, Saudi banks will adopt virtual assets although they will likely prioritise stability and compliance in the wholesale market over rapid expansion in retail and small business as seen with UAE’s stablecoin.

The Best is Yet to Come

Pradeep Negi SVP Payments and Compliance, Portfolio Delivery at RAKBANK, provides detailed insights into the current payments environment, highlighting that this rapidly developing sector in the world of finance still has much space for innovation and growth

November of this year marks the deadline for banks to be ISO20022 compatible. Will all regional banks make this deadline?

The November 2025 deadline for UAE banks to achieve ISO 20022 compatibility is fast approaching. While the transition is ambitious, most regional banks are actively working toward compliance. However, whether all banks will meet the deadline depends on several factors:

1. Early Kick-Start with AANI (Domestic Payments). The majority of UAE banks initiated their ISO 20022 delta analysis and compatibility gap assessments with the launch of AANI in March 2023.

2. Core & Supporting Systems Impact. The magnitude of this change requires extensive system reconfigurations and changes in rules for compliance, especially in systems dependent on structured, enriched ISO 20022 data elements.

3. Adoption Strategies. Native vs. Converter-Based: Some banks have opted for a Native ISO 20022 implementation, directly incorporating new message formats into their core systems. While this approach is more future-proof, it is also more complex and resource-intensive.

4. Challenges & Potential Delays. Legacy systems, especially in

smaller banks, face difficulties interpreting and processing enriched ISO 20022 messages.

While a significant portion of UAE banks are on track to meet the November 2025 deadline, complete readiness across the board remains uncertain however, larger and mid-sized banks, particularly those with AANI experience and proactive ISO 20022 strategies, are well-positioned.

What have been the noticeable impacts of the inaugurations of the UAE’s Aani and Saudi Arabia’s SARIE instant payments platforms?

The Transformative Impact of UAE’s AANI and Saudi Arabia’s SARIE Instant Payments Platforms, launched respectively in 2023 and in 2022, has

significantly transformed domestic payment landscapes across the region. These platforms have introduced realtime, account-based and proxy-based payments, aligning domestic payment infrastructures with international payment standards while enhancing transparency, compliance and customer convenience.

The impact of these innovations has been profound, with notable advancements in digital payment adoption, regulatory alignment and user experience.

What difference has the existence of Buna made to regional economies and businesses?

Buna has been a catalyst for regional economic growth and cross-border payment Innovation.

• The launch and evolution of Buna has significantly transformed the regional payment landscape across the Arab world, serving as a cornerstone for cross-border financial integration. As an advanced payment system operated by the Arab Regional Payments Clearing and Settlement Organisation (ARPCSO), Buna has successfully bridged regional and international currencies, fostering greater economic connectivity and unlocking new business opportunities. Since its inception, Buna has demonstrated remarkable growth:

• Approximately 120 banks have signed the Buna Participation Agreement, with 105 banks now fully operational. ( Ref. BUNA newsletter)

• The platform supports all major six key currencies—AED, EGP, SAR, JOD, USD and EUR—encouraging a wider adoption of non-Arab currencies alongside regional ones.

• Additionally, the key differences Buna has made to regional economies and businesses include:

Pradeep Negi, SVP Payments and Compliance, Portfolio Delivery, RAKBANK

• Simplified payment processes for businesses dealing with international clients and suppliers.

• Enhanced convenience for customers who can pay cross-border invoices using only a phone number.

• Improved customer experience through frictionless payment interfaces in digital banking apps.

What key roles do you see the embedding and advancing development of AI having in relation retail and commercial payments?

The rapid advancement of Artificial Intelligence (AI) is having a transformative role, reshaping the retail and commercial payments landscape, particularly with recent developments in instant payments, proxy-based payments, QR payments and real-time merchant settlements. As consumer expectations for seamless, secure and immediate transactions continue to grow, AI’s role has become more pivotal than ever.

AI is no longer just a back-office tool; it is now at the core of modern payment ecosystems, driving innovation, operational efficiency, risk mitigation and customer-centricity. Here is how AI is embedding itself into retail and commercial payments in the context of these new payment innovations:

1. AI-Driven instant payments & early merchant settlements

2 Proxy-Based Payments: Simplifying commerce with AI insights. The introduction of proxy-based payments—using mobile numbers, email IDs or other identifiers instead of traditional account details—has simplified cross-border payments and enhanced payment accessibility.

3. QR-Based payments: Revolutionising Merchant Payments with AI

4. Direc t account transfers for merchants: Real-Time Reconciliation with AI

5. Enhancing cust omer experience through AI insights

Can we expect to see further developments in payments or payments technology or are they reaching peak evolution?

Payments innovation is far from reaching Its peak!

The world of payments is undergoing continuous transformation, and despite the remarkable progress made over the last decade, the industry is far from reaching its peak. PayTechs, Payment Service Providers (PSPs) and banks are driving this evolutionary momentum, capitalising on real-time transfers, account aggregation and seamlessly embedded payment experiences.

PAYMENTS INNOVATION IS FAR FROM REACHING ITS PEAK!

While the pace of innovation varies across markets, the trajectory of advancements in open banking, realtime payments, digital wallets and voiceactivated payments suggests that payments technology is only entering its next phase—one that will be more instantaneous, invisible and frictionless. And here is why the peak of payment innovation is still ahead:

1. P ayTechs: The driving force behind innovation. The continued collaboration between PayTechs and incumbent PSPs will shape new propositions that deliver greater convenience and cost-efficiency for businesses and consumers alike.

2. Open Banking: From one-off payments to subscription models. Open banking has already transformed how customers interact with their finances, but its full potential remains untapped—especially regarding subscription payments.

The subscription payments market will continue to expand rapidly, especially with AI-driven personalisation and automated payment flows catering to streaming services, digital content platforms and utility providers.

3. R eal-Time Payments: The new standard for global commerce. Realtime payment systems have already seen wide-scale adoption through platforms such as:

• AANI in the UAE

• SARIE in Saudi Arabia

• UPI in India

• FedNow in the US

Real-time payments are evolving to support proxy-based identifiers like mobile numbers and email addresses, further simplifying payment initiation.

4. Digital Wallets & Super Apps: The rise of embedded finance

Digital wallets and super apps have emerged as cornerstones of modern payment ecosystems. With biometric authentication and AI-driven personalisation, digital wallets will continue to evolve, blurring the lines between domestic and international payment experiences.

5. The Rise of Voice-Activated Payments: Payments without touch —once the realm of science fiction. They are now becoming mainstream, as natural language processing (NLP) and AI capabilities improve, voicebased payments will become more intuitive, particularly in smart homes, vehicles and wearable devices.

6. Ce ntral Bank Digital Currencies (CBDCs): A new payment paradigm. Central banks worldwide are exploring or implementing CBDCs to modernise monetary systems. The integration of CBDCs with instant payment systems will significantly reduce crossborder transaction costs, streamline remittance flows and enhance financial inclusion.

7. PayTechs and Incumbent PSPs: A collaborative future. While PayTechs are spearheading innovation, incumbent PSPs are not standing still.

Remittances and Currencies in the UAE

Mohammad Elsaadi who joined Careem as the VP of Careem Pay in 2023, and has since spearheaded their evolution into a holistic fintech that now offers P2P transfers, international remittance, bill payments and merchant checkout solutions, gives us his particular insights on remittances payments and currency fluctuations in the UAE

How have recent global events – the recent United States elections for example, impacted currency exchange rates relevant to UAE expats, and specifically those sending money to India and other key remittance corridors? Major global events can impact currency exchange rates because they create uncertainty in global markets. This can cause investors to perceive higher risks on the horizon and move capital toward safe-haven currencies, which in turn leads to fluctuations in exchange rates. Alternatively, if a country is seen as more attractive post-election, demand for its currency rises. A recent example of this was the US elections, which led to a notable appreciation of the USD in late January and early February. Since the UAE dirham (AED) is pegged to the USD, this resulted in a stronger AED against key remittance corridor currencies, including the Indian rupee (INR) and Pakistani rupee (PKR). In line with this trend, we have

Mohammad Elsaadi, VP of Careem Pay

seen many UAE expats take advantage of the favorable exchange rate, leading to a surge in remittance transactions during this period. Beyond elections, broader global economic factors - such as ongoing discussions around tariffs and trade policies - continue to influence exchange rate movements. These factors affect the economies of export-reliant nations, potentially leading to currency depreciation and shaping remittance behaviors in key corridors.

What trends are you observing in remittance volumes and frequency from the UAE in the current economic climate?

What we are seeing in terms of the trends in remittance volumes and frequency is a noticeable spike in remittances from British and European expats in January and February of this year compared to November and December last year. The UK and Europe lead in ticket volumes, indicating a higher total value of transfers. Meanwhile, Pakistan sees the highest

frequency of transactions throughout the month, highlighting a preference for more regular money transfers.

How are users navigating these currency fluctuations?

To navigate and best manage these fluctuations in currencies, many expats now appear to be timing their transfers strategically, either taking advantage of favorable exchange rates or managing financial obligations through frequent, smaller transactions.

How does Careem Pay’s remittance service address the specific needs of expats in the UAE?

To address the specific needs of expats in the UAE, we have built our remittance service around the needs of the region’s expats, offering a seamless, fast and affordable way to send money home. With highly competitive exchange rates - up to 50% cheaper than banks - and zero hidden fees, we ensure customers

WE ARE SEEING A NOTICEABLE SPIKE IN REMITTANCES FROM BRITISH AND EUROPEAN EXPATS IN JANUARY AND FEBRUARY OF

THIS YEAR COMPARED TO NOVEMBER AND DECEMBER LAST YEAR

inclusive, fast and affordable remittance solution that meets the evolving needs of expats - whether they’re supporting family or managing their financial investments abroad.

How is fintech changing the landscape of international money transfers and impacting the expat experience in terms of speed and cost-effectiveness?

As is widely seen and experienced across the payments and remittance sectors, the application of fintech is

integration of AI-driven exchange rate forecasting, greater adoption of realtime payments and deeper financial inclusion through digital platforms. These innovations will empower expats with smarter and more efficient ways to manage their money internationally.

How is Careem Pay planning to evolve its remittance services to meet the changing needs of expats in the future?

Careem Pay has rapidly expanded its remittance services, entering more than twenty-five markets in under two years, with a corridor-by-corridor approach that ensures full compliance and a seamless customer experience.

TO HELP CUSTOMERS GET THE BEST VALUE, WE INTRODUCED A ‘RATE ALERT FEATURE’ WHICH NOTIFIES CUSTOMERS WHEN RATES ARE MOST FAVORABLE

Rather than launching multiple corridors at once, we focused on quality and reliability from the start, delivering a high-performing solution that serves major remittance destinations, including India, Pakistan, the UK, the Philippines, Lebanon and Europe.

get the best value. Our near-instant transfers allow them to send money when it matters most, without the hassle of follow-ups. Last year, we processed largevolume transfers in as little as eleven seconds. For Careem Plus members, we go even further, offering exclusive member-only rates and zero fees on transfers, enabling customers to save hundreds of dirhams with each transfer. Our vision for Careem Pay is to offer an

transforming remittances by driving down costs and significantly improving speed and accessibility. Digital platforms like Careem Pay, with some of the largest corridors in the world including Pakistan, India and the UK, are now reducing reliance on traditional remittance providers.

What developments can we expect to see in the future? Looking ahead, we expect further

To help customers get the best value, we introduced a ‘rate alert feature’ which notifies customers when rates are most favorable. Careem Plus members enjoy zero fees and exclusive rates, allowing them to save up to AED 400 per transfer - one of the most competitive offers in the market.

As a result, Careem Pay’s remittance service has become one of the fastestgrowing on the Careem Everything App. We are excited to continue expanding and providing our customers with a smarter, more affordable way to send money home.

Generational Change

In our fast changing and increasingly competitive premium market, GCC banks must strategically position themselves, redesign operating models and build strong execution frameworks to thrive in the evolving private banking and wealth management landscape

GCC cities, particularly Dubai, Abu Dhabi and Riyadh, have emerged as the go-to hubs for entrepreneurs and the world’s wealthy families seeking favourable business policies and expansion opportunities.

The GCC is solidifying its position as a centre of global wealth, with its financial wealth projected to expand by 4.7% annually by 2027 to reach $3.5 trillion, up from $2.8 trillion in 2022, according to Boston Consulting Group (BCG).

From UBS Group to Deutsche Bank to Rothschild & Co, the world’s largest wealth managers are increasing their presence in the Middle East to win business with affluent individuals, family

offices, charities and foundations across the region.

The GCC’s private banking and wealth management sector is set for continued expansion, driven by several key factors: rising personal wealth, a growing emphasis on individual financial planning and the ongoing transfer of wealth between generations.

“The industry is undergoing a paradigm shift fuelled by changing demographics, generational wealth transfer, the growing influence of millennial high-net-worth individuals (HNWI) and burgeoning digitalisation,” said Capgemini.

However, a transformative shift is underway in the GCC’s private banking and wealth management sector, creating

new opportunities for family offices, wealth managers and private banks.

Global advisory firm IMC highlighted the crucial role of leading financial centres such as the Dubai International Financial Centre, Abu Dhabi Global Market and King Abdullah Financial District in driving this transformation.

“Naturally, the GCC region has been drawing substantial international investment over the last decade. The growth is reshaping the financial position of the region, with wealth management firms adopting client-oriented strategies and advanced technologies to meet the demands of investors.”

Meanwhile, a confluence of new consumer preferences, digital models, demographics, macroeconomics, regulatory and competitive trends has fundamentally reshaped the private banking and wealth management experience for consumers and advisors alike.

An unprecedented transfer of wealth will take place over the next decade, reshaping the GCC’s financial landscapes and intergenerational wealth management. Similarly, wealth management and private banking are following the lead of retail banking by increasingly using artificial

intelligence (AI), big data, robotics and other innovative technologies to advance customer experience, foster trust and streamline operations.

Private banks and wealth managers in the GCC must play the long game to capitalise on the transformation sweeping the industry, as evolving consumer preferences, tech advancements in banking and changing market dynamics present both challenges and opportunities.

Trillions on the move

It is impossible to discuss private banking and wealth management without considering wealth transfer and succession planning. Wealth transfer and succession planning are essential components for HNWIs and enterprising families to preserve their legacy and wealth for future generations.

Since the beginning of time, inheritance has been a constant feature of human society, with wealth and estates transferring between generations.

The Middle East is poised for a historic intergenerational wealth transfer, with an estimated $1 trillion (AED 3.67 trillion) in high-net-worth assets expected to change hands by 2030, according to Swiss private banking group Julius Baer. Notably, the UAE has experienced robust growth in this sector, with high-net-worth assets increasing by 20% since 2022 to reach $700 billion.

For GCC enterprising families, succession planning and family governance have always been an essential part of successful wealth planning. “Regional trends indicate that Millennials and Gen Z are taking their place in the boardrooms of family businesses, as GCC states are implementing laws to support the continued economic contribution of family-owned businesses,” Saod Obaidalla, Executive Vice President and Head of Private Banking at Emirates NBD said in a blog post.

However, cultural sensitivities in the GCC region have often prevented open conversations about retirement and leadership transition within family

AI HAS THE POTENTIAL TO MAKE THIS A REALITY, REVOLUTIONISING THE INDUSTRY BY EMPOWERING ADVISORS WITH TOOLS TO PERSONALISE CLIENT ENGAGEMENTS, GENERATE INSIGHTS, AUTOMATE TASKS AND OPTIMISE

STRATEGIES

– Backbase

businesses, making succession and estate planning a less common practice.

“Up to now, succession planning and governance have not always been a high priority for many family businesses in the GCC region due to cultural expectations which make it hard for younger family members to discuss retirement and death with founders or current leaders,” PwC and World Government Summit (WGS) said in a joint report.

The proactive approach of GCC states in supporting enterprising families is yielding encouraging results, with targeted practical measures now in place to address succession and estate planning needs. Abu Dhabi’s new law and Dubai’s Family Business Centre are taking significant steps to protect family businesses and ensure a seamless transfer of ownership and management to future generations.

PwC and the WGS said that the UAE offers a range of government programs and facilities to support family businesses, including special events that facilitate networking and knowledge sharing. The UAE is not alone. Saudi Arabia is actively working to support family businesses through targeted measures, including the National Center for Family Business, which aims to enhance their role and sustainability under Vision 2030.

“What makes family businesses unique in Saudi Arabia compared to other countries outside the region is that the majority are relatively young – established during the 1960s – and have either gone through one succession or none yet,” according to KPMG.

Wealth transfer, which encompasses the transfer of ownership of businesses, property and other assets, is the ultimate indicator of how successfully a family navigates the transition from one generation to the next. Structured succession and wealth transfer enable patriarchs to establish a lasting legacy and secure the financial future of their families.

The evolving landscape of wealth in the GCC, characterised by the growth of family-owned businesses and the influx of wealthy individuals from around the world, is creating new challenges for wealth managers.

To meet the complex needs of their growing pool of clients, advisors are focusing on enhancing their expertise in wealth preservation and succession planning and simultaneously diversifying the investment options they provide.

Exploring new frontiers

The private banking and wealth management industry has transformed significantly over the past decade. While private banking and wealth management are traditionally known for their established values and personalised, confidential service, which are still important, McKinsey suggests that these qualities alone are “no longer enough” for many clients.

Clients now demand personalised advice tailored to their specific situations, along with easy-to-use digital tools and customised experiences.

Fuelled by shifting demographics and evolving investment trends, wealth

PRIVATE BANKING & WEALTH MANAGEMENT

managers and private banks are increasingly harnessing the power of AI, Big Data and the cloud to augment client experiences and build stronger trust.

AI is making remarkable progress in a wide array of tasks, as demonstrated by the rollout of DeepSeek, OpenAI’s ChatGPT and Alphabet’s Gemini.

“AI has the potential to make this a reality, revolutionising the industry by empowering advisors with tools to personalise client engagements, generate insights, automate tasks and optimise strategies,” according to Backbase’s The Platform Advantage: Accelerating AI & innovation in wealth management report.

The hyper-personalisation inherent in ChatGPT capabilities holds the potential to transform the financial services landscape radically, setting a new standard for customer experience and engagement.

Wealth managers in the GCC region are exploring various applications across the value chain to improve client experience and boost operational efficiency. The integration of GenAI is projected to revolutionise client interactions, reduce costs and drive productivity gains across the industry.

“Wealth managers are starting to use GenAI to monitor transactions and screen clients by such means as media and name screening,” BCG said in a report while noting that early adopters are realising significant efficiency gains in their processes for generating and handling alerts.

The future of wealth management is digital. AI is poised to transform wealth management significantly by enabling more personalised, data-driven advice across various areas, including portfolio optimisation, risk management, fraud detection, tax analysis and even client relationship management.

The tech advancements, combined with the drive for greater efficiency and lower costs, have fostered a flourishing wealth sector.

Rising to the challenge

Global private banks and wealth managers are increasingly expanding

their presence in the GCC, driven by the region’s robust economic growth, an influx in HNWIs and strategic initiatives by governments to diversify their economies.

Rothschild, JP Morgan, Deutsche Bank and HSBC are locked in a fierce battle for dominance in the GCC, expanding their presence in Dubai, Abu Dhabi and Riyadh to capitalise on the region’s economic growth.

Last November, HSBC also launched its private banking services in Kuwait, demonstrating the bank’s commitment to expanding its wealth management offerings in the Middle East. The new service offers clients world-class wealth solutions, global private banking expertise, an extensive international network and access to market capabilities.

While international financial institutions have historically dominated private banking and asset management in the Gulf region,

WHAT

The increasing interest in impact investing among wealthy families and high-net-worth individuals is pushing private banks and wealth managers to develop strategies in response to growing public awareness of the global sustainability agenda.

“Wealth managers find themselves in the position of needing to identify, develop and commercialise products that are compatible with or actively promote environmental themes while ensuring that such products have the potential to generate a level of return commensurate with traditional investments,” according to BCG.

To achieve success in sustainability, private banks and wealth managers must adopt a proactive strategy to navigate a constantly changing regulatory landscape, evolving client expectations, limited availability of

MAKES FAMILY BUSINESSES

UNIQUE IN SAUDI ARABIA COMPARED TO OTHER COUNTRIES OUTSIDE THE REGION IS THAT THE MAJORITY ARE RELATIVELY YOUNG – ESTABLISHED DURING THE 1960S – AND HAVE EITHER GONE THROUGH ONE SUCCESSION OR NONE YET

– KPMG

local players are increasingly stepping up, particularly in countries experiencing a surge in new wealth creation.

Progressive private banks and wealth managers in the GCC must address increasing global competition as international firms move into the region, significantly raising standards and operational expectations.

Meanwhile, the growing interest in impact investing among wealthy families and HNWIs is pushing private banks and wealth managers to develop strategies in response to growing public awareness of the global sustainability agenda.

data-driven metrics, and an increasing demand for internal expertise to provide clients with knowledgeable and professional guidance on sustainability matters.

Private banking and wealth management continue to offer strong growth prospects, fuelled by rising household and entrepreneurial wealth, as well as the ongoing transfer of wealth across generations. The sector is experiencing notable regulatory changes, emphasising alignment with global standards and the adoption of best practices.

HNW Hot Spot

Saad Osseiran Head of Private Bank Middle East at Deutsche Bank tells MEA Finance that Deutsche Bank is extremely bullish about our region’s wealth management and private banking market, and gives us some clear reasons to understand exactly why

What key factors are currently fuelling the growth of wealth management across our region?

Firstly, the Middle East is seen as a safe haven for wealth preservation amid global economic and geopolitical uncertainties. Middle Eastern countries benefit from regional stability and connectivity to global markets. In particular, Riyadh, Abu Dhabi and Dubai are seen as a key

financial hubs connecting East to West, thereby driving demand for UHNW and entrepreneurs to setup their regional headquarters catering to both business needs and family wealth. Secondly, governments in the region, in particular those of the UAE and Saudi Arabia are implementing initiatives and reforms to attract foreign investment and to improve the business environment. Introduction of long-term residency visas and tax incentives in countries like the UAE has

encouraged wealth retention and growth. Diversification from the oil & gas sector has created a boom in other sectors like finance, technology, tourism and real estate, thereby creating new wealth and opportunities for wealth management. Thirdly, the Middle East has a young population, with a significant portion entering their wealth-accumulation stage. Social reforms and youth empowerment in Saudi as part of Vision 2030 will create significant opportunities and wealth in the coming decade. All these factors contribute towards the growth of wealth management in the Middle East and Deutsche Bank is extremely bullish on the Middle East region, and looking to expand across all of our private banking, investment banking and corporate banking franchise.

Deloitte’s International Wealth Management Centre Ranking in 2024 for asset size shows Bahrain and the UAE at eighth and ninth positions, respectively. Will regional booking centres rank higher by 2030?

We anticipate regional booking centres in the Middle East to rank higher by 2030 as investors look to diversify from traditional wealth management hubs like London, Switzerland, Singapore and Hong Kong. We see more clients starting to consider

Saad Osseiran, Head of Private Bank Middle East at Deutsche Bank

other jurisdictions for diversification purposes, particularly in the UAE due to the favourable factors mentioned above. For Middle East clients, we see a trend towards re-investing locally and not only directing investments internationally. The growth of wealth management in the region also helps to attract key talent, including senior talent who traditionally base themselves in other wealth centres such as New York, London or Singapore, to consider moving to the region to benefit from the growth in wealth management sector in the region. The same can be said about banks, asset managers, hedge funds and private equity managers who are looking to setup offices in the region to capture the growth in the region.

Succession planning in the region has been a much debated concern in recent years, so is it now being satisfactorily addressed?

Family-owned businesses account for approximately 90% private companies in the Middle East and contribute significantly to GDP. Many of these businesses are transitioning from first or second generation leadership to the next generation. Succession planning in

WE

ANTICIPATE

WE SEE COMPETITION AS HEALTHY AND A KEY DRIVER FOR INNOVATION AND DEMOCRATISATION OF FINANCE

of formal plans. To address this, many families are adopting formal governance structures, such as family constitutions, boards of directors consisting of both family and outside directors, and setup of family offices to manage their wealth, plan for succession and ensure longterm sustainability. In addition, some countries, such as the UAE and Saudi Arabia are in the process of introducing legal reforms to improve corporate governance and facilitate smoother succession processes.

As AI technology makes tailored financial services more accessible and inclusive, how can regional private banking define itself?

Compared to a decade ago, wealth managers today are faced with a much

REGIONAL BOOKING CENTRES

IN THE MIDDLE

EAST TO RANK HIGHER BY 2030 AS INVESTORS

LOOK

TO DIVERSIFY FROM TRADITIONAL WEALTH MANAGEMENT HUBS LIKE LONDON, SWITZERLAND, SINGAPORE AND HONG KONG

the Middle East is evolving, with increased awareness of its importance and growing best practice adoption. However, there are challenges particularly around cultural sensitives, large families and complex family dynamics, regulatory framework and Shariah law, and lack

more complex regulatory requirements, particularly around KYC, AML and investor suitability and offering framework. This, combined with cost pressure, will require institutions to adopt AI technology to improve efficiency specifically in areas such as fraud detection, credit and

market risk assessment and automation of routine tasks. In the near future, we see a trend for affluent and HNW segments to pivot towards AI-powered algorithms to analyse client data, risk profiles, investment preferences and provide personalised investment advice and portfolio recommendations. This will enable Private Banks to use dedicated resources more efficiently to provide high-touch and tailor-made solutions for the UHNW and Family Offices, where the human personal touch is still required and makes a big difference in the relationship coverage.

What will be the effects on those operating in the regional market, and their clients, of the growing and increasingly competitive wealth management sector?

We see competition as healthy and a key driver for innovation and democratisation of finance. Increased competition allows banks to reinvent themselves and constantly improving the offering shelf. Banks that are nimble, entrepreneurial, adapt to the changing landscape and can provide the right solutions will benefit the overall financial ecosystem and emerge as winners. At Deutsche Bank, strategic partnerships are especially important in this area, in particular with government enablers and supporting local initiatives, connecting our global UHNW clients to regional clients to explore areas of mutual collaboration and bringing in investment into the region. In turn, this enhances our global offering and potential business we can capture with our UHNW clients and family offices, both in the Middle East and globally.

Powerhouse of Prosperity

Vipul Kapur Head of Private Banking at Mashreq, talks exclusively with MEA Finance, sharing insights on the key trends fueling the growth of wealth management and private wealth in the region

What are the main elements now defining the GCC as a leading global hub for wealth management?

Gulf Cooperation Council (GCC) states, particularly the UAE and Saudi Arabia, are rapidly emerging as a global hub for entrepreneurs and wealthy families seeking favourable business policies and expansion opportunities. With the Middle East region poised for an unprecedented generational wealth transfer of US$1 trillion (AED 3.67 trillion) by 2030, the landscape of Private Banking is evolving at a remarkable pace. Affluent families in the GCC are integrating sustainability in their investment strategies, reinforcing the region’s prominence as a wealth management powerhouse.

What key factors are currently fueling the growth of wealth management across our region?

The wealth management sector in the Middle East is experiencing remarkable growth, driven by several key factors. The region›s economic landscape is flourishing. In 2023, the region saw a 6.2% increase in ultra-high-net-worth individuals (UHNWIs), only second to North America with 7.2% 1 This surge reflects the robust economic activities and diversification efforts underway. Governments are also proactively enhancing financial frameworks. By the end of 2024, the Dubai International

Vipul

Kapur,

Head of Private Banking at Mashreq

Financial Centre (DIFC) registered over 6,920 entities, marking a 25% increase from the previous year. 2

Such reforms are creating a more conducive environment for wealth management services.

Further, the integration of digital platforms and AI-driven advisory services is revolutionising client interactions, making wealth management more accessible and personalised. This technological shift caters to a tech-savvy clientele seeking efficient and tailored financial solutions.

A significant transfer of wealth is also occurring, with younger generations prioritising investments in Environmental, Social and Governance (ESG) initiatives, impact investing and digital assets. This shift is reshaping traditional investment strategies to align with contemporary values.

The MENA wealth management market is projected to grow from US$1.25 trillion in 2024 to US$1.78 trillion by 2029. This growth is driven by a broader range of investment products, including private equity, structured solutions and sustainable investments, attracting a diverse clientele 3 .

Collectively, these factors are propelling the wealth management industry in our region, positioning it as a dynamic hub for sophisticated financial services.

Deloitte’s International Wealth Management Centre Ranking in 2024 for asset size shows Bahrain and the UAE at eighth and ninth positions, respectively. Will regional booking centres rank higher by 2030?

Bahrain and the UAE have already established themselves as leading global wealth management hubs. This is a testament to the region’s strong regulatory frameworks, economic resilience and ability to attract high-networth individuals (HNWIs).

Looking ahead to 2030, there are several factors that could push these centres even higher in the rankings. Firstly, the continued influx of global wealth into the region is expected to accelerate.

The UAE, for example, has been a top destination for migrating millionaires, in fact more than any other country in the world with Dubai alone attracting over 6,500 new millionaires in 2024. 4

Secondly, ongoing regulatory advancements in financial free zones like DIFC and Abu Dhabi Global Market (ADGM) are making the region even more attractive for asset booking. The rise of alternative investments, including private equity and sustainable finance, is also playing a key role.

Bahrain benefits from a strong regulatory framework, leading position

in Islamic finance and initiatives like open banking and fintech advancements. The country is attracting global wealth managers with tax incentives and strategic access to GCC markets.

While competition from established centres like Switzerland and Singapore remains strong, if current trends continue — particularly with digital transformation and wealth preservation strategies — the UAE and Bahrain could see even higher rankings by 2030.

Another key centre to look out for is Saudi Arabia, which is experiencing a surge in UHNWIs, driven by Vision 2030, the rise of family offices and financial market expansion. The Saudi Tadawul Group’s growth and mega-projects like NEOM are boosting investment opportunities, making Saudi Arabia a rising wealth hub as well.

Succession planning in the region has been a much-debated concern in recent years, so is it now being satisfactorily addressed?

Succession planning has been a growing priority in the region, especially with nearly US$1 trillion in wealth expected to transfer across generations by 2030. Historically, this topic was often delayed or overlooked, but today, we are seeing real progress.

Regulatory advancements have played a huge role. The DIFC and ADGM have introduced legal frameworks that give families more flexibility and clarity, making succession planning more structured. Given that family businesses contribute around 80% of the non-oil GDP in the GCC, ensuring a smooth transition is critical to long-term economic stability.

Another key shift is in awareness. More family offices and business owners are recognising the importance of planning ahead. We’re also seeing the next generation getting actively involved, bringing fresh perspectives and governance models.

That said, challenges remain. Many families still find the process complex and cultural factors can slow decisionmaking. Aligning traditional values with

MORE FAMILY OFFICES AND BUSINESS OWNERS ARE RECOGNISING THE IMPORTANCE OF PLANNING AHEAD

modern legal structures takes time, but the momentum is there.

Overall, while there’s still work to do, succession planning is being addressed more proactively than ever, which is a positive sign for the region’s long-term financial landscape.

As AI technology makes tailored financial services more accessible and inclusive, how can regional Private Banking define itself?

As artificial intelligence (AI) continues to reshape the financial services industry, regional Private Banking has had a real opportunity to define itself by focusing on the things technology cannot replace. While AI makes financial services more accessible and efficient, I feel like it’s the human touch and relationship-driven approach that sets Private Banking apart.

AI can certainly provide useful insights and streamline processes, but private banks are in a unique position to offer clients something more personalised, strategic advice, tailored wealth planning and bespoke solutions that take into account a client’s entire financial picture. For HNWIs especially, that level of personal attention and trust is irreplaceable.

What is also critical is local expertise. AI can deliver global data, but clients in this region often value knowledge of the local market, customs and regulations. Whether it’s navigating Islamic finance principles or aligning with sustainable investing, private banks have an opportunity to cater to the unique needs of their clients.

In short, by combining the power of AI with personalised service and deep local knowledge, regional private banks can carve out a distinctive and highly relevant space in today’s digital-first world.

What will be the effects on those operating in the regional market, and their clients, of the growing and increasingly competitive wealth management sector?

As the wealth management sector continues to grow and become more competitive in the region, I think we can expect some significant shifts for both firms and clients. For wealth management firms, the increased competition will encourage innovation and a stronger focus on personalised services. To stand out, firms will need to offer better tailored investment strategies and build deeper, trusting relationships with clients. This could lead to a higher level of service across the board, with wealth managers using advanced tech and data-driven insights to provide more value.

For clients, the growing competition means more choices and, likely, lower fees as firms compete for their business. Clients will have access to a wider range of innovative products, including alternative and digital assets. The result will be a more personalised financial experience, where clients can receive faster and accurate advice, powered by AI and digital tools.

However, with all these options, clients may feel more pressure to choose wisely, as the market can get more complex. Ultimately, though, this increased competition is a win for clients — it fosters greater innovation and efficiency, ensuring they get the best possible solutions and services.

Intelligence Agency

Supplementing the well understood benefits, Agentic AI, heralds a new generation of increasingly powerful operating systems for autonomous decision making and action-taking, promising to further enhance service and customer experience, though banks would be wise to also weigh up potential risks

GCC states are positioning themselves as key players in the field of artificial intelligence ( AI), as the transformative technology is projected to contribute $320 billion to the Middle East by 2030 – accounting for about 2% of the global economic impact. AI has the potential to fundamentally alter the region’s financial services sector, disrupting traditional structures and paving the way for innovation and new operating models.

GCC banks are embracing AI-driven transformation, from automating processes to enhancing customer experiences, while carefully considering the ethical implications and potential risks.

“The vast scope and wide-ranging potential benefits of AI in banking –impacting everything from top line and cost efficiency to customer experience – underscore the importance of acting quickly and resolutely to secure the advantages of innovative technology,” according to Roland Berger.

Experts in the banking industry say AI can help financial institutions reduce costs and increase profitability, maintain a competitive edge in a rapidly changing financial ecosystem and improve operational efficiency across front-toback-office functions.

Digital transformation is revolutionising the banking sector, but a technology gap has emerged due to outdated legacy systems and the rise of agile fintech startups.

While traditional banks are moving to the cloud to become more agile and accelerate their digital transformation, the rapid evolution of AI, particularly generative AI (GenAI), is fundamentally changing what it means to be digital in the banking industry.

S&P Global highlighted that banks have a long history of using AI to improve risk management, minimise losses, prevent fraud, enhance customer retention and drive efficiency and profitability. However, the adoption of both established and innovative AI technologies is poised to fundamentally change how banking services are delivered and experienced.

The emergence of GenAI in early 2023 has yielded promising results for banks globally while simultaneously introducing new potential risks. For banks in the GCC, the key challenges are determining the most effective applications of GenAI and ensuring its successful adoption and scaling across their organisations.

AI is reshaping banking as banks shift from being reactive to proactively serving customer needs. GCC banks face crucial decisions as technology is shifting customer expectations and changing the regulatory landscape.

Stepping up the AI gears

Over the decades, banking practices have not changed. The industry’s fundamentals still consist of taking in deposits, lending money and managing payments, but agentic AI is expected to revamp how that work gets done significantly.

The financial services industry is on the verge of a major transformation with the rise of agentic AI. Building upon the foundation laid by innovative technologies such as GenAI, Blockchain and Robotic Process Automation (RPA), agentic AI introduces a new era of autonomy and intelligent decision-making.

Agentic AI’s key differentiator lies in its capacity to operate in real-time, enabling informed decisions and continuous performance optimisation through ongoing learning. The futuristic agents are designed to mimic human capabilities by performing tasks autonomously, working collaboratively, reflecting on progress and refining performance through iterative learning.

The World Economic Forum said unlike GenAI, which relies on human input and struggles with complex, multi-step reasoning and coordination, agentic AI employs networks of learning, adapting and collaborating agents. The agents make decisions and continuously improve, mirroring human cognitive processes.

While still in its experimental phase, agentic AI holds transformative potential for banking, with applications ranging from compliance, deepfake and fraud

prevention and onboarding/KYC processes to wealth management, credit and treasury workflows.

“Agentic AI represents a new generation of increasingly powerful foundation models that act as operating systems for autonomous, action-taking, digital agents capable of enhanced reasoning and decision-making, as well as increasingly disruptive chatbots and copilots,” said Bank of America Institute.

The rapid advancement of AI is evident in the emergence of agentic AI, a next-generation technology that is already appearing even before chatbots and copilots reach their second versions. Agentic AI has the potential to autonomously handle a wide range of tasks, from complex software engineering projects and customer service interactions to more personal tasks like booking travel arrangements.

The emergence of GenAI followed eight decades of incremental progress, increasing computational power and reducing the time and cost associated with training resource-intensive foundation models. However, agentic AI has arrived remarkably quickly, appearing just two years after the launch of ChatGPT and the beginning of GenAI’s widespread adoption.

“Agentic AI’s greater autonomy compared to GenAI allows it to manage repetitive, data-heavy processes. It empowers banks and the broader financial services ecosystem to optimise workflows, strengthen compliance and improve decision-making, ultimately revolutionising how they operate and interact with customers in this new era,” according to the World Economic Forum.

Agentic AI offers banks two key avenues for transformation. Internally, it can drive operational efficiency by automating routine tasks such as data entry, compliance checks and report summarisation. The futuristic agencies can also build sophisticated predictive models for trading, risk management and insights into market dynamics, fraud, credit and liquidity risk.

Externally, Agentic AI can enhance customer relationships through automated help desks powered by chatbots and personalised investment recommendations.

Next frontier of customer experience

Today, retail banking customers are less loyal and readily switch banks for a better experience and value. They expect their banks to prioritise their financial wellbeing, offer services beyond traditional banking to support their lifestyles and ensure data security and transparency.

PwC underscored that customer experience is becoming critical for all industries. The fundamentals are evolving as new engagement strategies are shaping up and accelerated by emerging technologies such as Agentic AI and GenAI. From real-time translation to conversational interfaces, AI technologies are increasingly shaping our daily lives, with particularly transformative effects in the financial services sector. Digital disruptors – such as neobanks and fintech companies – are at the forefront, introducing groundbreaking AI-driven innovations that are redefining the industry.

“AI can significantly improve and scale customer service in banking with better self-service tools that handle more of your customers’ questions. AI-powered self-service enables banks to resolve high volumes of inquiries more efficiently, enhancing customer satisfaction and reducing operational costs,” according to Salesforce.

To stay competitive, incumbents in the GCC must adopt an ‘AI-first’ approach in both vision and execution, which entails comprehensive transformation across their entire capability stack, encompassing the customer engagement layer, AI-driven decisionmaking processes, core technology and data infrastructure, as well as their operating model.

Meanwhile, agentic AI systems are poised to revolutionise the financial services industry, particularly in how

banks interact with their customers. These systems are redefining customer engagement and emerging as a transformative force within the industry.

“While traditional rule-based chatbots (software-as-a-service) provided basic 24/7 support and Retrieval Augmented Generated (RAG)-based chatbots enhanced human-like interactions (enhanced softwareas-a-service), agentic AI surpasses both in terms of accuracy, contextual coherence and problem-solving ability,” said PwC.

Though still nascent, the integration of agentic AI enables banks in the GCC to deliver highly personalised and responsive customer experiences. AI-powered chatbots and virtual assistants can deliver immediate support, respond to customer inquiries and even suggest relevant products based on individual preferences and real-time interactions.

Banks have multiple pathways to enhance customer experience,

Over the years, all customer-facing channels, whether in retail or corporate banking, have embraced digital banking services to meet customers’ evolving demands. While many of these experiences still rely on the involvement of banking representatives, the integration of agentic AI in the sector is set to revolutionise the landscape by delivering highly personalised and seamless customer experiences.

Risk management & AI

While AI has driven the latest wave of automation, the transformative technology holds the promise of making banks innovative, more efficient and better equipped to deliver stronger financial outcomes.

“Banks that extract value from AI view the technology as a transformational tool and use AI for core strategic priorities such as boosting revenue, differentiating

with them. The launch of DeepSeek in January generated concerns over the potential risks that GenAI poses.

The Association of Certified Fraud Examiners said as more sophisticated versions of GenAI evolve, bankers and compliance professionals can expect to see instances of more persuasive phishing emails or more convincing impersonators scamming for information.

To address financial crime concerns, banks and financial institutions must implement robust cybersecurity measures to protect AI systems from hacking, data breaches and unauthorised access.

AI offers a vast advantage in risk management as it can analyse large amounts of data to detect any unusual patterns and identify possible fraud while greatly increasing monitoring teams’ efficiency and effectiveness.

CUSTOMER PROPOSITIONS CAN NO LONGER BE STATIC AND ONE-SIZE-FITS-ALL – THEY SHOULD BE INTELLIGENT AND TAILORED AND GO BEYOND BANKING TO ADDRESS CUSTOMER NEEDS THAT MAY INVOLVE BOTH BANKING AND NON-BANKING PRODUCTS AND SERVICES

– McKinsey

including offering efficient self-service options and creating personalised customer journeys through data and analytics. However, the integration of AI in the financial services sector has the potential to enable comprehensive, end-to-end digital transformation.

“Customer propositions can no longer be static and one-size-fits-all – they should be intelligent and tailored and go beyond banking to address customer needs that may involve both banking and non-banking products and services,” according to McKinsey.

the bank from competitors and driving higher satisfaction for customers and employees,” said McKinsey.

However, with the financial service sector navigating the rapidly evolving technological landscape, banks in the Gulf region must carefully evaluate not only the benefits but also the potential risks associated with innovative technologies such as AI.

Banks are inherently exposed to risks due to the nature of their business, which involves handling financial assets, investments and the liabilities that come

“The integration of AI into the cybersecurity framework of the banking sector encapsulates the technology’s dual nature as both a potential risk factor and a critical defensive tool. By embracing an integrated approach that emphasises security by design, ethical development practices and collaborative innovation, banks can harness AI’s full potential to fortify their cybersecurity defences,” said EY.

Banks in the GCC region are leveraging AI to automate fraud detection and investigation processes, streamlining workflows and directing cases to the appropriate teams. Similarly, others are already using LLMs to identify potential fraud indicators proactively.

GCC banks are rapidly digitising, making the adoption of advanced AI technologies crucial for their continued success. The financial institutions are well-positioned to outperform their global counterparts by leveraging AI to drive growth. Its key applications include adaptive new product management, increasing risk-weighted asset share and reducing operating costs while advancing risk management, customer experience and market trend forecasting.

TRANSFORMING PAYMENTS:

Key Trends Shaping the MEA Financial Landscape

Detailing significant growth in payments across the MENA region, Sriranga Sampathkumar VP and General Manager – Middle East and Africa, Infosys Ltd., and Siva Subramaniam Head – Product Management – Payments & Cash Management, Infosys Finacle, underline the priorities for banks, new market trends and how financial institutions can face increasing levels of competition

The MENA digital payments market presents a significant growth opportunity, with projections indicating a robust CAGR of 10.95% from 2025 to 2030, expanding from USD 251.34 billion to USD 422.56 billion. This dynamic growth is driven by a confluence of factors, including government initiatives, a thriving fintech ecosystem and escalating consumer demand for seamless and realtime payment experiences.

However, this burgeoning market contrasts sharply with the decelerating

growth observed in mature markets like Europe (projected at 2%) over the next five years and North America (projected at 5%). This divergence underscores the critical need for banks in the MENA region to adapt and innovate.

To thrive in this evolving landscape, banking CXOs in the MENA region must prioritise strategic imperatives. These include:

• Modernising operating models: Adapting to the evolving digital payments ecosystem requires a fundamental shift in how banks operate.

• Investing in next-generation t echnologies: Embracing technologies such as AI, blockchain and open banking is crucial for competitive advantage.

• Forging strategic partnerships: Collaborating with fintechs and other ecosystem players can accelerate innovation and expand market reach.

• Prioritising customer-centricity: Delivering seamless, personalised and secure payment experiences will be paramount in attracting and retaining customers.

Failure to adapt to these imperatives could leave banks in the MENA region at a significant disadvantage in this rapidly evolving market.

Key Trends Shaping the Payments Landscape in 2025

According to a recent survey, only 10% of banking executives believe incumbent banks will lead payments innovation by 2030. Meanwhile, 37% predict dominant consumer technology giants (such as Apple, Google) will drive innovation, while 16% each expect fintechs and major digital businesses (like Amazon, Uber, Alibaba) to take the reins. In this rapidly evolving environment, which key trends should banks be focusing on? What strategic priorities will keep them relevant through 2025 and beyond? Let’s explore these questions here.

• Real-Time Payments (RTP): The Middle East has emerged as the world’s fastest-growing RTP market, with transactions projected to hit the $2.6 billion mark by 2027. This growth is driven by transformative government-led initiatives like Saudi Arabia’s instant payments system,

Sriranga Sampathkumar, VP and General Manager – Middle East and Africa, Infosys Ltd

Siva Subramaniam, Head – Product Management – Payments & Cash Management, Infosys Finacle

“Sarie,” and the UAE’s efforts to modernise payment infrastructures.

• Digital W allets and Mobile Payments: The Middle East and Africa (MEA) mobile payments market is expected to register a CAGR of 30.1% during 2025-2030. The region has witnessed a significant decline in cash usage for in-store payments, supported by the rise of mobile payments. Smartphone penetration rates of 80%-90% in leading Middle Eastern markets have facilitated this shift.

• ISO 20022 Migration: The migration to ISO 20022 in the MEA region is set to enhance payment infrastructures, enabling faster cross-border transactions and improved compliance with international standards. This transition is crucial for banks to streamline operations and offer improved services.

• Regulatory Compliance: Regulatory bodies in the Middle East are proactively establishing frameworks to ensure the stability and security of the payments ecosystem. For instance, the UAE›s Stored Value Facilities Regulation and Saudi Arabia›s digital banking initiatives are setting compliance standards that financial institutions must adhere to.

• Int ensifying Competition: The payments sector is witnessing heightened competition from fintechs, neobanks and integrated software vendors (ISVs), particularly among small and mid-size businesses. ISVs are distinguishing themselves by integrating payment solutions with digital wallets and operational tools, creating seamless experiences that are highly attractive to merchants. For traditional banks, this necessitates a strategic shift towards exploring partnerships and investing in digital

capabilities to retain and grow market share.

• Embedded Finance: The embedded finance market is anticipated to maintain a steady growth trajectory with a CAGR of 27.5% from 2024 to 2029, resulting in USD 37.68 billion revenues by 2029. Sub-segments such as Buy Now, Pay Later (BNPL) and open banking are gaining momentum and expanding into new sectors like housing and utilities, groceries, car payments and repairs, and others as businesses recognise their potential to enhance customer experiences and promote financial inclusion.

• Cross-Border Payments: There is an anticipated acceleration of crossborder, cross-currency instant and B2B payments. This is reinforced by the adoption of ISO 20022, providing a consistent messaging standard for payments, enabling seamless 24/7 transactions across borders.

Composable Payments Platforms: The Key to Transformation

To meet the demands of this evolving landscape, composable payments platforms addresses diverse challenges, including seamless integration of different payment channels, agility in adapting to evolving standards, innovation in product offerings and customisation for varied business and customer needs. With scalability to handle increased transaction volumes and interoperability with ecosystem partners, composable architectures ensure that banks can stay competitive and meet the dynamic demands of the market, enhancing security and minimising risks. Furthermore, these platforms leverage ISO 20022 standards, API-driven interoperability and reusable components to deliver dynamic and secure payment solutions. Key features of a composable payment platform:

• Modularity: Composable platforms

function like building blocks, allowing banks to assemble and disassemble components to meet specific needs. This modularity ensures scalability and flexibility.

• API-Centric Design: Well-defined APIs enable seamless integration with thirdparty systems, fostering collaboration and ecosystem innovation.

• Standards-Based Integration: Platforms built on ISO 20022 standards ensure consistency and interoperability across global markets.

• Service Composition: Composable platforms offer the infrastructure to create new services and evolve existing ones, fostering continuous innovation.

• Interoperability: These platforms emphasise seamless interaction between internal components and external systems, creating a connected financial ecosystem. An example of a bank that is laying the foundations with Next Gen Open Enterprise Payments would be Qatar National Bank (QNB), implementing the newest faster payment rail in its home country in a record time of 16 weeks. This significant milestone underscores QNB’s dedication to driving innovation and enhancing customer experience in the rapidly evolving financial landscape.

Conclusion

The MENA payments market is experiencing unprecedented growth, driven by a confluence of factors. However, this growth also brings increased competition. Composable payment platforms offer a competitive edge by enabling businesses to:

• Adapt quickly to market changes: Respond swiftly to evolving consumer demands and regulatory shifts.

• Innovate with agility: Easily integrate new features and functionalities to stay ahead of the curve.

• Reduce time-to-market: Launch new products and services faster and more efficiently.

• Enhance cus tomer experience: Deliver seamless and personalised payment experiences.

CEO2 : The Power of One

MEA Finance joined Wendy Wang Founding Management and Group President, Ascentium and George Hojeige CEO, Virtuzone who explained that the acquisition of Virtuzone by Ascentium delivers a powerful enabling force for businesses in the Middle East and Asia to further power their successes, and that by making use of the growth opportunities their combining brings, companies across both regions now enjoy much expanded potential

What were the driving business factors that brought Virtuzone and Ascentium together?

Our mission at Virtuzone has always been to simplify business setup and empower entrepreneurs with toptier corporate services designed to help them succeed. As we continued to enhance our industry-leading solutions, it became clear that we also needed to expand our reach to cater to the ever-changing needs of businesses in an increasingly interconnected world.

To scale our impact globally, we needed a strategic partner with an established international presence, visionary leadership

Wendy Wang, Founding Management and Group President, Ascentium

that matches ours and notable industry experience. That is where Ascentium came in.

Based in Singapore, Ascentium possesses an extensive global footprint, unparalleled expertise in providing innovative business services and farreaching access to emerging markets around the world—key factors that perfectly align with our vision of further establishing Virtuzone as the premier corporate services provider in the UAE and beyond.

Their support has given us access to fresh capital and global resources, optimally positioning us to provide multijurisdictional solutions aimed at helping businesses achieve tax efficiencies and regulatory compliance across key international markets.

But our coalition with Ascentium goes beyond expanding our operations and boosting our impact. This alliance creates a seamless, end-to-end ecosystem for businesses in the UAE, ensuring their operations remain efficient, compliant and competitive both locally and internationally.

By unifying our leadership insights, market expertise and unique service offerings with Ascentium, we aim to transform the corporate services industry by delivering cutting-edge, future-ready solutions that enable businesses to thrive in today’s fast-moving global economy, creating a one-stop shop for our clients.

This is a pivotal moment for Virtuzone, our clients and the broader entrepreneurial community in the country, as we create new opportunities and usher in a future where businesses can operate optimally in a highly digital and borderless world.

Why is the timing of the joining of Virtuzone with Ascentium optimum for both businesses?

This milestone comes at the most opportune time and builds on the UAE’s impressive economic growth in recent years. With foreign direct investment (FDI) inflows reaching USD 30.69 billion

in 2023, the UAE is on track to realising unprecedented growth across multiple economic sectors.

For instance, its rapidly expanding e-commerce industry is projected to hit USD 17 billion in 2025, while its tourism sector is expected to attract AED 100 billion in investments and welcome 40 million hotel guests by 2031.

Furthermore, international analysts predict the UAE’s gross domestic product (GDP) will grow between 4.1% and 6.7% this year.

All these numbers underscore one thing—the UAE is one of the most lucrative investment hubs in the world right now, and with Ascentium’s invaluable support,

trends and the competition, expanding our reach and operations and evolving the solutions we bring to the UAE’s small and medium enterprises (SME) sector.

With Ascentium’s support, we are now even better positioned to access neighbouring markets in the Gulf Cooperating Council (GCC) region, bring our proven industry-leading solutions to these emerging markets and enable these economies to realise the potential of their entrepreneurial communities and startup sectors.

Simultaneously, we seek to continuously realign our efforts with the UAE’s national economic goals and help further establish the country as a

TO SCALE OUR IMPACT GLOBALLY, WE NEEDED A STRATEGIC PARTNER WITH AN ESTABLISHED INTERNATIONAL PRESENCE, VISIONARY LEADERSHIP THAT MATCHES OURS AND NOTABLE INDUSTRY EXPERIENCE. THAT IS WHERE ASCENTIUM CAME IN

we can pave the way for our clients and partners to capitalise on this prime opportunity more effectively.

Meanwhile, this also presents Ascentium with a solid avenue to establish their presence in one of the world’s fastest-growing and most dynamic markets and harness untapped market opportunities not just in the UAE but throughout the region.

How does Ascentium’s acquisition shape Virtuzone’s medium to long-term strategy for our region?

Our medium- to long-term strategy has always been multi-faceted, anchored on reinforcing our market leadership, innovating to stay ahead of industry

global hub for entrepreneurs, investors and businesses. By securing access to the region through our extensive presence and network, Ascentium can now connect these stakeholders with opportunities across the GCC and Middle East and North African (MENA) markets, fostering mutually beneficial partnerships that drive long-term growth and innovation.

Imagine a tech startup from Singapore seamlessly setting up in Dubai with ease of access to scalable corporate solutions, funding and talent, or a UAE-based investor looking to scale its operations to Hong Kong or Australia without being burdened by the bureaucracies of traditional processes.

These are the scenarios we are aiming to fully realise by forming a business environment specifically designed to empower global investors and businesses. Combining our deep regional expertise with Ascentium’s global reach will not only allow us to shape the future of corporate services, but the future of business itself.

In which ways can the new arrangement assist with the banking and financial requirements of Virtuzone’s clients?

The new arrangement between Virtuzone and Ascentium is a game-changer when it comes to meeting the banking and financial needs of our clients.

Firstly, we are now able to offer more banking options and comprehensive solutions, particularly for businesses operating beyond the UAE. Whether you are expanding into new markets or managing cross-border operations, our enhanced network ensures you have access to the right financial tools and services tailored to your needs.

internationally. Navigating regulatory requirements can be a headache, but merging our local banking solutions with Ascentium’s expertise and global reach enables us to ensure businesses stay compliant while securing access to cutting-edge banking solutions worldwide.

THIS NEW ARRANGEMENT IS NOT JUST ABOUT MEETING OUR CLIENTS’ BANKING NEEDS—IT’S ABOUT EMPOWERING THEM WITH THE FINANCIAL FLEXIBILITY, ACCESS AND COMPLIANCE SUPPORT THEY NEED TO THRIVE GLOBALLY.

Additionally, this partnership opens doors and improves access to sophisticated funding mechanisms and financial institutions worldwide. For entrepreneurs and businesses looking to scale, this means easier connections to investors, lenders and financial partners who can support your business and growth ambitions, no matter where you are.

We are also simplifying and streamlining banking compliance, both locally and

This new arrangement is not just about meeting our clients’ banking needs—it’s about empowering them with the financial flexibility, access and compliance support they need to thrive globally.

What additional operating benefits or enhancements does your alignment bring to Virtuzone’s and Ascentium’s clients?

This alignment is a transformative step forward for Virtuzone’s and Ascentium’s

clients, partners and the markets that we serve.

For Virtuzone’s clients, this acquisition gives us unique insight into Ascentium’s growth strategies and operational frameworks in fast-growing markets like Asia Pacific (APAC), allowing us to localise and adapt these proven strategies for SMEs in the UAE and the Middle East.

Harnessing Ascentium’s globally linked network and resources enables us to offer small businesses and startups a broader range of corporate services— bundled, holistic solutions that were previously unviable due to cost barriers. By leveraging economies of scale, we are making premium services more accessible than ever.

In addition, Ascentium’s strong presence in key markets like Singapore and the APAC region means we can provide UAE-based businesses with a “plug-and-play” solution for tapping into these regions. Think of it as a tried-andtested blueprint for global expansion, ready to be deployed and scaled efficiently.

On the other hand, Ascentium clients, partners and stakeholders aspiring to access the GCC and MENA markets through the UAE can readily utilise our proven expertise and solutions, cutting

down inefficiencies, reducing barriers and fast-tracking their global operations and growth in the region.

How will Virtuzone retain, or even build on its strong local presence as it scales operations internationally with Ascentium?

While we scale our operations and uncover new frontiers with Ascentium, maintaining and strengthening our presence in the UAE remains a top priority. Our success has always been rooted in our deep understanding of the local business landscape and our ability to provide entrepreneurs with agile and groundbreaking solutions.

This will not change. In fact, our expansion will allow us to enhance our capabilities in the UAE and the region, ensuring that our clients continue to receive best-in-class services while also opening doors to new global opportunities.

We will continue to upgrade our core services, from company formation and tax advisory to specialised corporate services, to ensure businesses in the

their knowledge, strengthening our leadership and fostering a culture of technological innovation.

Additionally, we are upgrading our digital infrastructure to provide

been central to our company ethos through the years. Ascentium’s global network provides us with unparalleled insights into emerging business trends, regulatory frameworks and best practices across multiple regions. This enables us to not only expand our footprint but also bring back valuable knowledge and innovations that will benefit our UAE-based clients.

Could the combining of Virtuzone with Ascentium eventually make a measurable contribution to the regional economy?

Yes, we firmly believe this landmark acquisition will have a tangible and measurable impact on the national economy and regional market in the near future, particularly as Virtuzone becomes an even more crucial player in the UAE’s startup ecosystem.

For one, serving as the focal intermediary between the UAE and the Asia Pacific regions helps us bolster the country’s position as an even more attractive destination for global business leaders, investors and entrepreneurs.

WHILE

WE SCALE OUR OPERATIONS AND UNCOVER NEW FRONTIERS WITH ASCENTIUM, MAINTAINING AND STRENGTHENING OUR PRESENCE IN THE UAE REMAINS A TOP PRIORITY

UAE have access to innovative solutions precisely engineered to support their growth. As we expand internationally, our commitment to delivering high-quality, localised expertise remains unwavering.

Another critical focus is the ongoing investment in our people, technology and infrastructure. We recognise that the strength of Virtuzone lies in our team, which is why we are committed to upskilling our employees, deepening

businesses of all sizes with smarter, more efficient solutions. From AI-driven business setup platforms to enhanced customer support channels, we are ensuring that entrepreneurs can access our expertise with greater ease and convenience.

Our partnership with Ascentium gives us a springboard to scale our expertise into new markets while staying true to the client-centric approach that has

Moreover, our commitment to aligning with internationally accepted standards for excellence raises the bar for business services in the region, ensuring the UAE remains a top choice for global talent and investment. This directly supports the UAE’s national goal of generating AED 3 trillion in GDP, growing its non-oil exports to AED 800 billion and raising the value of its foreign trade to AED 4 trillion by 2031.

Our synchronised, tech-driven approach will also be crucial in this growth strategy, as we make innovative solutions more affordable and accessible to microbusinesses and SMEs. Integrating our resources, wealth of data and diverse expert insights will allow us to develop and deploy cutting-edge digital tools that enhance productivity and efficiency in key business processes, ultimately boosting profit margins for our clients here and abroad.

COMMERCIAL BANK OF DUBAI

Driving Innovation, Sustainability and Economic Growth in the UAE’s Banking Sector

In this exclusive interview with MEA Finance Magazine, Dr. Bernd van Linder, CEO of CBD, shares insights into how the bank is navigating global macroeconomic challenges while advancing its digital-first strategy, sustainability initiatives and commitment to the UAE’s economic vision

In an era of unprecedented technological advancement and economic transformation , the UAE’s banking sector is at the forefront of innovation and sustainable growth. As Dubai pursues its ambitious Dubai Economic Agenda and the nation progresses toward its goals, Commercial Bank of Dubai (CBD) is a key player in shaping the future of banking. From pioneering digital innovations to launching groundbreaking green financial products, CBD’s journey reflects the dynamic evolution of banking in the region in tune with emerging trends.

Banking in the UAE has undergone significant transformation over the past few years. Can you start by discussing the key global and regional macroeconomic factors that have influenced this evolution, and how Commercial Bank of Dubai (CBD) has adapted to these changes?

As you rightly observed, the past three years have been transformative,

marked by both global challenges and unprecedented opportunities. On a macroeconomic level, we’ve seen the world navigating the lingering effects of the pandemic, supply chain disruptions and inflationary pressures. The impact of this has been compounded by rising interest rates globally, which have affected consumer behaviour and borrowing patterns.

Regionally, the UAE has shown remarkable resilience and agility despite global headwinds. Government-led initiatives such as the Dubai Economic Agenda plan have driven economic diversification and fostered a healthy recovery. The UAE economy has continued its strong growth, driven by robust activity in core sectors such as real estate, tourism, financial services, logistics and trade.

The nation’s forward-thinking policies have successfully attracted global talent, high-net-worth individuals and international businesses, underlining the UAE’s position as a premier global business hub. This is evidenced by record-breaking Foreign Direct Investment flows and increased activity in equity markets, manufacturing and trading. The UAE offers an exceptional quality of life, a favourable tax environment, world-class infrastructure and global connectivity, making it a top-ranked location for ease-of-doing-business.

Dr. Bernd van Linder, CEO, Commercial Bank of Dubai

Today, the UAE is the most diversified economy in the GCC region with the nonoil GDP contribution touching a new high of 75% in 2024. The current Purchasing Managers’ Index reflects sustained expansion in non-oil sectors, indicating that the UAE will continue to be in a sweet spot in 2025 and beyond.

You mentioned Dubai Economic Agenda plan; can you elaborate on how CBD is aligning with these national goals?

Our strategy is deeply integrated and aligned with the transformative national agendas. For instance, CBD provides an array of solutions and benefits to support Dubai Economy & Tourism (DET) to promote the manufacturing sector and make UAE a central player in global trade. Additionally, we are actively supporting SMEs by easing the onboarding process and scaling up lending. With our competitive pricing, we have also fostered lending growth through home finance, credit cards and commercial loans. Our r ecent collaboration with DET on the Dubai Unified License (DUL) to cut SME onboarding time from over 70 days to under five, has significantly improved the customer experience and our business efficiency.

Moreover, as customer expectations shifted towards seamless, remote banking experiences, we accelerated our digital transformation strategy to maintain our position as ’digital-bydesign’ bank and to ensure our customers continued to receive top-tier services.

Speaking of digital transformation, how has this shift impacted the evolution of banking, particularly in the UAE? Digital transformation has fundamentally reshaped the banking landscape. Today’s customers demand convenience, speed and personalised experiences. At CBD, we recognised early on that a digital-first approach was no longer optional — it was a strategic imperative.

CBD was the first bank to establish a Digital Lab at The Innovation Hub in DIFC. The objective is to create a collaborative ecosystem in the FinTech sector by fostering innovation and supporting integration between financial institutions and FinTech start-ups.

Our award-winning digital banking platform has been at the forefront of this evolution with a new app launched in H2 2024, offering customers an array of services that can be accessed anytime, anywhere. The app helps customers seamlessly navigate through and apply for a range of products and services. We are also one of the eight licensed financial institutions to launch Aani, a key initiative under the CBUAE’s Financial Infrastructure Transformation (FIT) programme.

To enhance internal operational efficiency, we recently teamed up with Microsoft to harness the capabilities of Microsoft Copilot, enabling CBD employees to accomplish more with remarkable speed and efficiency. This collaboration between Microsoft’s Innovation Hub and our Data & AI team, has greatly improved our internal efficiencies, leveraging the power of advanced prompt engineering. As a result, we are now better equipped to meet our goals and deliver exceptional value to our customers.

With such a focus on innovation, how does CBD ensure that its cutting-edge digital innovations align with the unique financial needs of its customers in UAE?

At CBD, we’ve observed a notable shift in how customers engage with their finances. There’s a growing preference for self-service tools and real-time insights, and we’ve responded by rolling out digital channels to facilitate investments. These innovations not only enhance customer satisfaction but also improve our ability to acquire and retain customers in a competitive market.

Customer acquisition and retention are critical in banking. How does CBD ensure it continues to deliver value to its customers? Our strategy is to understand and deepen customer relationships through a focus on service excellence and by catering to their unique needs effectively.

We understand that banking is about purpose – your purpose. Whether you’re a retail customer, a startup founder pursuing innovation, a family building their future, or a corporation driving economic growth, customers come to us with a purpose that matters most to them. That is why we focus on combining innovation with deep understanding, ensuring we meet each customer’s unique needs effectively.

We create value for customers through innovative initiatives tailored to specific segments. These include bespoke services through our Elite/Private Banking and an array of credit card choices addressing the varying needs of customers. Our aim is to ensure that we address conventional banking through our ever-evolving solution while fostering innovation by placing an emphasis on financial inclusion. In fact, we are the first UAE bank to launch VASPs (Virtual Asset Service Providers).

Moreover, we place significant emphasis on customer feedback and retention. Through an established Voice of Customer Programme and NPS analytics, we gain actionable insights into customer preferences and pain points. This enables us to refine our products and services continually.

CBD recently launched a Green Bond and Green Growth account. Can you elaborate on the significance of these initiatives and how they align with your broader ESF framework? We believe banking should reflect the values that matter most to people. Sustainability isn’t just a buzzword; it’s fundamental to how we enrich lives while protecting tomorrow.

CBD has demonstrated its commitment to supporting the UAE’s goal to achieve Net Zero by 2050. Our Sustainable Finance Framework marks a strategic milestone in developing ecoconscious products and services that will accelerate the transition to a more sustainable future through our core business activities.

Our widely acclaimed $500M green bond issuance is a strong testament to our commitment to sustainability. The proceeds will be exclusively allocated to financing projects that adhere to the criteria outlined in CBD’s sustainable finance framework. Eligible initiatives include renewable energy, green buildings, clean transportation and pollution prevention and control.

Further, our Green Growth Account is an innovative savings account that not only helps customers grow their finances but also contributes to a greener future for everyone. It complements the UAE’s ambitions to plant 100 million mangrove trees by 2030 and is a one-of-a-kind product in the market.

Our ESG framework is built on five pillars: Environment, People, Financial Inclusion, Governance and Community. Through our various initiatives including product launches, recycled Debit/Credit Cards, skill-enhancing workshops, management training programmes, community volunteering and social advocacy, we are committed to supporting these five pillars.

Looking ahead, what role do you think AI and Data will play in the foreseeable future in line with banking trends?

AI and Data are set to revolutionise retail banking in profound ways. We are already witnessing a significant shift towards personalised banking experiences, but its true potential remains untapped. With the power of AI, banks can now analyse vast amounts of data to understand individual customer behaviours, preferences and needs. This enables them to offer customised financial products

and services, enhancing customer satisfaction and loyalty.

Another key trend is AI-driven predictive analytics, which is transforming risk management. By analysing historical data and identifying patterns, AI can predict potential risks and suggest proactive measures to mitigate them. This is particularly crucial in areas such as credit scoring, fraud detection and compliance.

With AI enhancing personalisation and risk management, how is it transforming operational efficiency and customer service in your industry?

AI and intelligent algorithms are significantly improving operational efficiency by streamlining routine processes, reducing human error and operational costs. We are leveraging this already – and continue to adapt emerging technologies - across cheque processing, loan booking and remittance services.

banking sector. Fintech startups and traditional banks are leveraging these technologies to develop new, cuttingedge solutions - from digital-only banks to blockchain-based transactions.

AI and Data are essential drivers of the next wave of transformation in retail banking. They are helping banks to become more agile, customer-centric and efficient, ultimately shaping the future of the financial services industry. Indeed, the evolution of banking through AI and Data is an exciting journey to witness.

How does CBD’s vision align with the UAE’s broader ambitions for the banking sector?

We see ourselves as catalysts for economic transformation. Every transaction we enable, every business we support and every partnership we forge drives the UAE’s vision forward under the Dubai Economic Agenda Dubai Economic Agenda goals.

OUR STRATEGY IS DEEPLY INTEGRATED AND ALIGNED WITH THE TRANSFORMATIVE NATIONAL AGENDAS

This enables us to reinvest the resource benefits to focus more on customer engagement initiatives.

In the realm of customer service, AI-powered chatbots and virtual assistants are becoming increasingly common. These tools provide 24/7 support, quickly resolving customer queries and guiding them through complex financial processes. This not only improves the customer experience but also frees up human agents to handle more intricate issues.

We cannot overlook the role of AI and Data in driving innovation within the

The nation’s leadership has set a framework for advancing the UAE’s financial sector, with a focus on strengthening the positioning of Dubai among the top three international destinations for financial services, tourism and business.

We believe that – and as our trackrecord shows – we are the bank that helps shape tomorrow, focusing on transformation, innovation, sustainability, customer-centricity and talent development. This is an exciting time for the industry, and we’re proud to be at the forefront of this transformation.

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Growth Opportunities

Answering questions about retail banking, Fernando Morillo Global Head of Retail Banking, Mashreq, points to unique regional characteristics creating growth for banks that must simultaneously be balanced with efforts to enhance customer loyalty

What would you consider to be the most significant change in retail banking in the MENA region over the past three years?

Digitalisation, driven by technological advancements, evolving customer expectations and regulatory changes have transformed the banking industry in the region, mirroring global trends.

Over the past 3 years, we have seen the arrival of digital-only banks, such as Mashreq NEO, offering fully digital experiences that appeal to younger, tech-savvy consumers. There have been strong investments from traditional banks into digital platforms and solutions to stay relevant and competitive.

Partnerships between banks and fintech companies have surged as demand for flexible, accessible and convenient payment options has increased. Such partnerships have enabled us to embrace innovations such as open banking and embedded finance, which offer seamless financial solutions, without consumers having to go looking for them by switching apps.

Digitalisation has vastly improved our ability to drive financial inclusion, with the launch of digital wallets meaning the underbanked and unbanked can access financial services previously out of reach.

Banks are leveraging artificial intelligence (AI) and data analytics to

enable hyper-personalisation, better credit scoring, improved fraud detection and prevention, and enhanced customer engagement. Automated response systems such as chatbots are streamlining operations, enabling employees to divert time and attention to queries requiring a greater degree of human interaction.

Are you expecting noticeable developments or trends in regional retail banking during 2025?

I expect banks to continue their focus on maintaining stability and resilience. Adapting to evolving regulatory landscapes will play a part in this; banks will invest in technologies and processes that enhance their operational resilience,

including the adoption of solutions that will streamline compliance and regulatory reporting and enhance stability.

Exponential advances in digitalisation and AI will continue. We will see more digitalonly banks emerging, more traditional banks introducing digital-only offshoots under their umbrella, and further expansion of digital platforms integrated into traditional banks (banking-as-a-service). Such options will be a key draw for new customers, and particularly those in the younger demographic for whom technology and innovation is an absolute way of life.

Innovation-driven developments such as open banking and embedded finance will further expand, with more comprehensive sharing of financial data across various services increasing integration of financial services into nonfinancial platforms to allow customers to access banking services seamlessly within their daily activities. To facilitate this, banks will continue to seek partnerships with fintech companies, redefining customer interactions with financial products and making banking more intuitive and accessible.

Alongside this, there will be a drive to ensure engagement with the younger demographic, and the implementation of targeted strategies that include educational tools and youth-oriented banking products. As well as promoting financial literacy, this will engender trust and loyalty, and help banks build and maintain long-term customer relationships.

Should regional banks focus on customer acquisition or building existing customer value generation?

As per recent data, Dubai saw its largest population growth since 2018, as it continued to see a massive influx of new immigrants including professionals, investors and whitecollar job seekers from all over the world. This has truly set UAE apart, as many other

Fernando Morillo, Global Head of Retail Banking, Mashreq

parts of the world see decreasing rates in population and immigration. With this increase, consumption is expected to increase substantially as well. Financial institutions, today, have the unparalleled opportunity to rise to this unique moment in history, making it imperative for them to focus both on customer acquisition and building existing customer value generation, equally.

At Mashreq, all customers – whether longstanding, new, or prospective – remain at the core of everything we do. Our growth strategy and digital transformation agenda is aligned with these market dynamics.

In emerging markets, continued focus on acquiring unbanked or underbanked customers is likely to yield results, with fintech partnerships and mobile banking solutions key to reaching these segments.

Expansion of our digital platforms within our traditional banking arm, and of our digitalonly Mashreq NEO offering is targeted at scaling our customer base that will help establish and expand market presence, with customer acquisition also key in competitive markets such as the UAE.

However, we must balance the drive for customer acquisition with dedicated focus to enhance our relationships and services for existing customers. Particularly in markets with high banking penetration, building loyalty through exceptional service and hyperpersonalised experiences, demonstrating our deep understanding of our customers and their needs, is what has set us apart.

Have changes in retail banking over recent years reduced or boosted banks’ margins?

Banks have long enjoyed high interest rates to combat higher inflation across regions – including UAE, Egypt and Pakistan – which has helped with maintaining good margins. However, as interest rates come down progressively over the next few tears, banks’ margins are also expected to compress, slowly and steadily.

Additionally, expansion of our industry to include digital-only banks and fintech challengers has intensified

the competition in the financial services landscape. Traditional banks need to constantly reimagine their propositions and evolve to stay ahead of the curve – one way to do that is to ensure fee structures and rates remain competitive.

Innovations such as open banking have opened up an array of possibilities for customers – and banks and fintechs need to collaborate and invest to meet this demand. Such investments must be thought of as opportunities, rather than short-term cost liabilities. Indeed, investments in technology and innovation is non-negotiable, poised to deliver longterm efficiencies and margins.

Stricter compliance and regulatory requirements have increased operational costs, especially for cross-border transactions and anti-money laundering (AML) requirements, but the resulting strengthening in trust is likely to enhance customer experience and drive customer loyalty, a key area of focus for Mashreq.

Given the great number and diversity of customers across the region, can banks effectively cater to cultural, ethical or environmental concerns at the retail banking level?

We place great emphasis on catering to the diverse customer base in our region, from something as simple as offering customer service channels in multiple languages to addressing more complex, in-depth cultural, ethical or environmental concerns.

For customers requiring Islamic banking, we offer Shariah-compliant financial options such as Murabaha (costplus financing) and sukuk bonds, ensuring customers can choose the products and services that align with their cultural and religious needs. It is also imperative that we offer financial solutions, such as sustainable financing and socially responsible and other ESG-led retail products that align with our customers’ beliefs, values and priorities.

We are committed to driving financial inclusion, ensuring that our products

and services are available to all who need them. Digitalisation and the right partnerships are key contributors to our progress in this regard.

Banks work hard to improve retail customer experiences, but what can customers do to improve their own banking financial lives?

We encourage our customers to actively engage with us so that in partnership, we can ensure they enjoy positive financial lives.

Awareness and education are key. Being financially literate is no more a luxury; it is imperative. We are committed to empowering our customers with the right knowledge and tools to make financially sound decisions, and do our utmost to ensure our products and services are as clear, transparent and understandable as possible.

Digital tools such as apps and online platforms enable customers to track expenses, set budgets and make informed decisions. Customers can define shortand long-term objectives, and create plans that align with their goals.

From a security perspective, both banks and customers have their respective roles to play. Customers can and should protect their accounts and finances by using security measures such as strong passwords, two-factor authentication and device binding. Being cautious about sharing personal information and vigilant about scam attempts via emails, messages or calls, is non-negotiable, as scams become more sophisticated and cybercriminals are investing in tapping into unaware customers. Banks like Mashreq are arming themselves against cyber-attacks and fraud attempts with very tight security technologies, to safeguard customer data and transactions. At Mashreq, we are ingraining security measures directly into the digital journeys so that we can contextually prompt customers to consider relevant risks at various points. We are constantly working towards enabling more personalised, secure banking experiences for our customers.

Gateway to Africa

Sebastian W. Graewert , Senior Executive Officer at The Mauritius Commercial Bank, Dubai, DIFC, in his Leadership Series Interview with MEA Finance, introduces MCB, detailing their growing corporate banking positions in capital markets and private banking, and their position as an ideal partner for business in the

Middle East and Africa

Tell us about MCB.

With over 185 years of history, we’re proud to be the oldest bank in the Southern Hemisphere. Today, MCB is the leading bank in Mauritius and the core asset of the MCB Group, a financial services company that is listed on the Mauritian Stock Exchange.

Our international activities contribute roughly half of our total assets and two-thirds of our group profits, and are rising fast given our increasing exposure in Africa. Much of MCB’s success is due to two factors.

First, our exceptional market position in the Mauritian International Financial Centre, MIFC. This hub has established Mauritius as a key gateway for commercial and financial flows linking Africa with Asia, the Middle East, Europe and the United States.

A second factor in MCB’s success is our strong credit profile, our robust liquidity position and unique investmentgrade rating in an African context. In recent years, we’ve evolved into a regional African bank. We’ve built a reputation as a specialised bank that excels in select

African markets and key industries such as energy, renewables, infrastructure and private equity, as well as support for traders and exporters.

In addition to our international corporate banking activities, we’re developing our international private banking and capital markets activities, helping us to diversify our revenues in less capital-intensive areas and ensure sustainable growth.

What makes Dubai an attractive location for MCB to establish a presence?

Dubai is a strategic location for MCB, and one of five international hubs alongside Nairobi, Lagos, Johannesburg and Paris. From Dubai we connect with clients in the UAE and beyond. Our goal is to understand their unique requirements and leverage on the specialised expertise of our teams in developing bespoke solutions to their requirements.

For instance, MCB recently was awarded a prestigious award, the Acquisition Finance Deal of the Year for Africa, for supporting an international consortium of investors including the UAE’s Mazda and Infinity Power from Egypt, creating the largest pan-African renewable energy company with one gigawatt of capacity. MCB structured and arranged a highly innovative acquisition financing facility for the transactions.

The DIFC and the ADGM are attracting various asset managers, capitalising on their growing reputation as hubs for global wealth management and investment management. Asset managers are a key client group of MCB, where we provide a comprehensive suite of banking and security services. In addition to that, we have fund-financing solutions that cover the entire lifecycle of an investment fund.

Gateway Partners, the DIFC registered emerging markets investment manager, is a good example where MCB is providing

Sebastian W. Graewert, Senior Executive Officer, The Mauritius Commercial Bank, DIFC

support to their ongoing capital raising activities. We’ve also developed a franchise with multi-family offices.

What is your outlook for SubSaharan Africa and the GCC in the current macro-economic environment?

Many corporates are establishing in Dubai to unlock business and investment opportunities in Africa, to capitalise on Dubai’s global business hub advantages. For some of these corporates, our DIFC office is an ideal partner because we can provide access to MCB’s specialised expertise and connect them with the MIFC.

We view the DIFC and the MIFC as complementary centers when doing business in Africa. Each has unique advantages that foster collaboration rather than competition. Our Dubai office also fosters the privileged relationships that MCB has with the Middle Eastern and regional banks that have become key partners, especially on the external funding side.

For example, we recently closed a two-year syndicated facility with strong participation from ADCB, FAB and many other regional banks. Our partnerships with the Middle Eastern regional banks also facilitate trade flows between Africa and the Middle East.

Additionally, we’ve developed a partnership with the Abu Dhabi Export Office that underscores our commitment to UAE exporters. We expect the interconnectivity between the UAE and Africa to accelerate as the UAE expands its CEPA free trade agreement program into sub-Saharan Africa after initial deals with Mauritius, Kenya and Congo.

What does ESG mean to MCB in the African context?

We have long been committed to integrating sustainability into our financing activities and we have established a framework for environmental, social and governance risk management. In Mauritius, we’ve redefined our corporate purpose with the agenda, Success Beyond Numbers. This means that we do not only

prioritise financial performance, but take into consideration the impact on communities, society and the environment.

For example, we partnered with Ciel Textile, a leading conglomerate in Mauritius, and launched a supply chain financing solution that allows businesses to optimise their working capital when using sustainable raw materials.

In recent years, we’ve developed our ESG strategy further, to address climate change and adopted a no-financing policy for coal. On the international front, MCB is focused on supporting environmentally friendly activities enabling African economies securing affordable energy and address climate change.

MCB is providing for electrification projects in Senegal, facilitating the conversion of powerboats to cleaner fuels.

Now, while we avoid supporting activities that are detrimental to the climate, we continue to support the oil and gas sector

At MCB, we are dedicated to leading the way in sustainable finance and ensure that our actions contribute positively to the communities and the environment.

What are MCB’s future plans in Dubai and beyond?

After five successful years in the DIFC, we are excited to scale up our presence in Dubai. In private banking, we will extend our scope of services to select high-networth individuals, particularly those with business ties to Africa.

Our value proposition is unique, as we will offer a bespoke solution that seamlessly integrates the UBO’s private wealth and its corporate assets. Further, as interest amongst private offices and other financial investors to deploy capital into African opportunities develops, we will aim to engage with them.

We remain committed to supporting Middle Eastern, multinational and African

WE VIEW THE DIFC AND THE MIFC AS COMPLEMENTARY CENTERS WHEN DOING BUSINESS IN AFRICA

in Africa. We believe that energy is essential for socio-economic development.

Developing oil and gas provides funds that are necessary to develop communities for education, for infrastructure or other development needs. Also, Africa’s contribution to the global greenhouse gas emissions is marginal and provides for a phased approach to transitioning to cleaner fuels.

Finally, we are also incorporating sustainability into our funding activities. We recently launched a $400 million sustainability-linked syndicated facility, attracting $800 million in investor demand. This success helps us to diversify our funding sources, achieve competitive terms, enables us to support sustainable projects and address climate change.

firms in Dubai, and in the future, will position MCB as a leading mandated lead arranger and book runner on capitalraising transactions, for instance, offering debt underwriting services for M&A transactions where we will leverage our network for deal distribution.

We aim to further develop our partnerships with the Middle Eastern banks as we will help them unlock investment opportunities in Africa, which will contribute to yield enhancement and risk diversification to their predominantly domestic and regional portfolios.

As we continue to strengthen our presence in the DIFC, MCB is fully committed to supporting clients seeking to engage with Africa. With MCB’s specialised expertise, we’re paving the way for your success.

Balance of Payments

Kartik Taneja Payments and Consumer Lending, Mashreq and Chairman of NEO PAY, details a trifecta of benefits with contactless shopping: speed, convenience and protection, though going forward, a balance will need to be struck between convenience and security

The payments industry has witnessed remarkable growth over the past few decades, transforming from basic swiped card transactions to today ’s sophisticated contactless digital solutions. This evolution has been driven by technological advances, consumer demand for seamless payment options, and the increasing need for accessibility in financial services. Innovations such

as near-field communication (NFC) and mobile wallet systems have made it easier than ever for users to transact with just a tap, whether on their phones or contactless-enabled cards.

While mobile contactless payments have gradually come to dominate face-toface payments, some consumers still hold back based on concerns surrounding security. Reassuringly, contactless mobile payments use tokenisation, which

prevents someone from knowing your actual card number during a “tap” and therefore protects you from the kind of fraud that was so common just a few years ago. This means customers can have confidence in our industry’s ability to protect consumers while enhancing convenience for them. Not only that, merchants love this technology as it shows higher success rates while having faster transaction times – making it more efficient and useful for them.

The Current Landscape

In 2023, the global market for contactless payments was valued at approximately $33.27 billion, with projections estimating growth to $91.80 billion by 2031, marking a CAGR of 13.5% 1 This trajectory is largely supported by countries such as the UAE and China, both leaders in digital payment adoption, setting the stage for a global revolution in how people interact with money. Indeed, the UAE – in support of the Central Bank’s Financial Infrastructure Transformation (FIT) program – has a goal of becoming a global digital payments hub.

Contactless Payments: Offering Convenience & More

Contactless payments offer consumers more than just the convenience of a quick tap. Such payments solutions, and the technology behind them, are reshaping how we interact with moneyfrom enabling the provision of real-time insights, improving accessibility, to offering valuable incentives. For businesses, these payments deliver immediate access to transaction data, enabling smarter, datadriven decisions, streamlined operations and a more responsive approach to customer preferences.

Kartik Taneja, Payments and Consumer Lending, Mashreq and Chairman of NEO PAY

They also play a crucial role in enhancing financial inclusion, making payments easier for underserved communities, and those who might otherwise struggle to access some payment options. Additionally, many contactless payment systems offer attractive benefits such as personalised offers, loyalty rewards and cashback programs, which not only incentivise customers to adopt digital payments, but also boost engagement and satisfaction. For financial institutions, the transaction data generated helps identify consumer spending patterns, allowing for personalised services and targeted marketing. However, as the adoption of contactless payments grows, ensuring robust security without sacrificing ease of use remains a critical challenge that must be addressed.

The Security Challenge

As the popularity of contactless payments soars, so do concerns about their security. The transition to digital also means that risks have become more sophisticated, requiring companies and regulators to stay vigilant against potential threats. Some of the key challenges include fraud risks – such as unauthorised transactions involving card-skimming or card-not-present fraud – and authentication gaps, where a PIN or signature is not required, raising concerns around potential misuse in the event of card loss or theft. Users can also face potential threats from malware that can intercept payment information on their devices, with risks heightened on devices lacking robust security or regular software updates, rendering them more vulnerable to data breaches.

To address these challenges, banks in the UAE, under the guidance of UAE Banks Federation and Central Bank of UAE, continue to work closely with fintechs and security providers to devise

new strategies and leverage advanced technologies towards reducing the risk of fraudulent or unauthorised transactions. The industry has also introduced several innovations that strengthen security measures while maintaining the convenience that contactless payments offer.

Innovations in Security for Contactless Payments

In parallel with convenience-related enhancements, the industry is making significant advances in security to counteract the risks associated with fraud and data breaches. Notable innovations driving this progress include encryption and tokenisation,

safeguarding contactless transactions. Stronger regulations, such as Strong Customer Authentication (SCA), require multi-factor authentication for higherrisk transactions, offering further bolster to security.

The Way Forward: Bridging Convenience and Security

As digital payments continue to evolve, the future will rely on achieving the right balance between convenience and security, driven by technological advancements and cross-industry collaboration. Innovations such as AI, blockchain and biometrics are redefining payment security, with AI-powered fraud detection systems capable of blocking

AS DIGITAL PAYMENTS CONTINUE TO EVOLVE, THE FUTURE WILL RELY ON ACHIEVING THE RIGHT BALANCE BETWEEN CONVENIENCE AND SECURITY, DRIVEN BY TECHNOLOGICAL ADVANCEMENTS AND CROSS-INDUSTRY

COLLABORATION

where sensitive payment data is protected during transactions. With data compromises increasing by 78% in 2023, the need for robust security measures beyond traditional encryption has never been more critical 2 , and tokenisation replaces real data with random tokens, making it ineffective to hackers. Biometric authentication technologies such as fingerprint, facial recognition and voice recognition are enhancing security on mobile devices, making it more challenging for unauthorised users to access funds. This additional layer of security is especially beneficial in

1 https://www.theinsightpartners.com/pr/contactless-payments-market

2 https://airbyte.com/data-engineering-resources/what-is-data-tokenisation

unauthorised transactions in real time. Continued collaboration among financial institutions, regulators and tech companies will be essential in creating a secure and interoperable payment ecosystem. At the same time, secure digital identity solutions will play a key role in ensuring that only verified users can access sensitive information. On a global scale, standardised payment processes will streamline cross-border transactions, making them more secure and efficient. As contactless payments continue to grow, they offer a glimpse into a future of seamless, secure transactions that enhance consumer confidence and open up new opportunities for businesses to deliver personalised, data-driven experiences.

Driving Digital Transformation for Financial Services

On the 5th of February, MEA Finance with Infosys were joined by top leaders, executives and thinkers from banks and technology providers at the Mandarin Oriental Jumeirah Hotel for an avidly participated debate about the key elements in the digital transformation of banks and financial institutions across our region

Digital transformation continues to be a strategic imperative for financial institutions, driven by the need to adapt to evolving market dynamics and rising consumer expectations. It can help banks reduce costs and increase profitability, maintain a competitive edge in a rapidly changing financial ecosystem and improve operational efficiency across front-toback-office functions.

“Digitalisation in finance is the reorganising and reshaping of finance and accounting function using technology to recreate efficient operating systems and processes without replacing traditional systems,” according to Infosys.

The adoption of innovative technologies in the banking sector is not only strengthening competitiveness in an increasingly digital-first economy, but it is advancing cross-functional efficiency

– from client-facing platforms and personalised services to back-end risk management and automation.

Digital transformation equips banks to deliver seamless, secure and hyperpersonalised customer experiences – a critical advantage in an industry where survival hinges not just on operational efficiency but on customercentric innovation.

Artificial intelligence (AI) is revolutionising the banking industry. The rapid advancements in both traditional and cutting-edge AI technologies, such as agentic and generative AI (GenAI), are transforming the delivery and consumption of banking services.

“Agentic AI’s greater autonomy compared to GenAI allows it to manage repetitive, dataheavy processes. It empowers banks and the broader financial services ecosystem to optimise workflows, strengthen compliance and improve decision-making,” according to the World Economic Forum.

MEA Finance, in partnership with Infosys, hosted an exclusive roundtable themed Driving Digital Transformation for Financial Services.

The event convened senior leaders from banking, finance and technology to explore how digitalisation is reshaping the banking sector. The discussion explored how digitalisation is reshaping the banking industry by driving operational efficiency and scaling technology operations, offering practical insights and strategies for modernising operations and achieving growth.

Jay Nair, EVP and Industry Head, Financial Services EMEA at Infosys, said in his keynote address that banks today are looking for partners who can drive digital efficiency in a cost-neutral way – and that’s precisely what Infosys focus on.

Nair highlighted that while Infosys has a strong presence in the Middle East and Africa through Finacle, the company is significantly expanding its broader service offerings, with financial services accounting for roughly 25% of its business.

“The Middle East stands out as a hub of innovation. While technology spending in parts of Europe and other regions remains stagnant, we see significant innovation happening at scale here,” said Nair.

“To reinforce our commitment to this region, we have made significant investments in talent, local execution capabilities and leadership.”

Banks have several avenues to advance customer experience, such as effective selfserve options and personalised customer journeys using data and analytics. However, the use of innovative technologies such as AI in the banking industry can drive true end-to-end digital transformation.

“Customers today are tech savvy and expect brands to be ahead of them. Going digital can track, attract and positively engage customers, while banks and financial institutions can offer and deliver consistent and personalised products and services,” said Infosys.

Building on its existing Finacle base of 80 Middle Eastern and African banks, Infosys sees a significant opportunity to expand its value proposition through a broader range of services beyond core banking.

“One of our early collaborations in the Middle East was with First Abu Dhabi Bank (FAB). We provided not only infrastructure services and support but leveraged our strong relationships with key ecosystem players such as hyperscalers and companies such as ServiceNow,” Nair said while noting that Infosys’ ability to integrate its deep understanding of the banking sector with these strategic partnerships is a key differentiator for the company.

“Our ability to partner with ecosystem providers, including ServiceNow, Eagle, Google Cloud, AWS and Azure, allows us to tailor cost-efficient solutions that meet each bank’s unique needs.”

Digital transformation and automation in banking have transitioned from

THE MIDDLE EAST STANDS OUT AS A HUB OF INNOVATION. WHILE TECHNOLOGY SPENDING IN PARTS OF EUROPE AND OTHER REGIONS

REMAINS

STAGNANT, WE SEE SIGNIFICANT INNOVATION HAPPENING AT SCALE

– Jay Nair

a desirable feature to an essential component of modern banking operations. While digitalisation and automation are not new to the industry, the trends have taken on new significance with the rise of financial technologies and the growing popularity of innovative operating models.

“The landmark merger of First Gulf Bank and National Bank of Abu Dhabi concluded in late 2018, establishing FAB as a unified entity. Naturally, the immediate post-merger period was dominated by the complexities of integration, leading to a necessary pause in significant technological advancements,” Srinivasan Sampath, Group Chief Information Officer at First Abu Dhabi Bank, said in his keynote address.

Sampath highlighted that the subsequent years saw a surge in demand from our business units, who were eager to deploy the capabilities that had been deferred during the integration.

To address challenges associated with the bank’s ambitious growth plans, Sampath said that FAB crafted a comprehensive fiveyear technology roadmap, aiming to elevate the banking group’s technology to a new level of maturity.

“One of our most pressing challenges was modernising ageing infrastructure, a legacy of the bank’s earlier integration,” he added, and to tackle this, FAB initiated a meticulous, year-long evaluation of potential partners, prioritising collaborators capable of driving transformative change.

“The process led us to select Infosys as our primary digital transformation partner. Our partnership extends beyond service delivery; it’s about leveraging Infosys’ platform partnerships to accelerate innovation and drive tangible results.”

HERE

By automating processes and leveraging innovative technologies, such as AI, financial institutions can reduce their reliance on manual labour and lower operating costs. The strategic adoption of automation and AI technologies allows financial institutions to dramatically enhance operational efficiency, ultimately translating into a significant competitive advantage.

“Our core aspiration has been to build a robust foundation for future technologies, drive pervasive automation and create an efficient, scalable operating model. As a leader in innovative solutions, FAB, alongside partners like Infosys, is committed to pushing the boundaries of digital transformation,” said Sampath.

Banks in the GCC region are demonstrating how digitalisation and automation can be used to leverage customer data, analytics and segmentation to advance products and services and build a ‘bank of the future.’

Banking reinvented

The once predictable banking industry has been dramatically reshaped, evolving into a complex and transformative sector marked by significant, core-level organisational changes.

PwC said that tech advancements, innovative business models, new competitors, complex regulations and evolving customer behaviour are driving a ‘new normal,’ placing significant pressure on traditional universal banking.

“Being a newly established bank, MBank enjoys a distinct advantage: we’re unencumbered by legacy systems. We understand that for many incumbents, digital transformation is fundamentally

about dismantling those legacy constraints and modernising operations,” said Mohammed Wassim Khayata, Chief Executive Officer at Mbank.

“However, from our vantage point, two core challenges remain universal across all banks - achieving seamless system integration and driving optimal technology investment returns.”

Khayata said that the fragmented nature of banking systems - card management, trade finance, branches, loans and digital platforms - poses a significant challenge: achieving seamless communication. The lack of integration leads to operational inefficiencies and a diminished customer experience.

Concurring with Sampath, Khayata said that the accurate measure of technology lies not in its acquisition but in its ability to generate maximum value.

“Regardless of size or age, whether a nascent bank like MBank or a longstanding institution, the fundamental principles of aligning transformation strategies with business goals remain constant. Seamless integration, operational efficiency and flawless execution are the cornerstones of success.”

To navigate the intricate landscape of evolving trends and generate lasting business value, incumbent banks in the GCC are compelled to innovate their models, establishing a strategic foundation rooted in a fresh perspective on markets, clients, capabilities and the potential of exponential technologies.

“The modern banking model is fundamentally reliant on underlying technology. If core banking systems were to fail, all operations would cease. Therefore, technology underpins both a customer-first approach and business growth,” said Gyan Prakash Srivastava, Head of Data Analytics and AI at Mashreq.

“To scale effectively, enhance customer experience and drive business growth simultaneously, we must leverage technology. Technology is no longer a mere function or cost centre; it’s a core business driver within the entire ecosystem.

We must recognise this shift and align our efforts accordingly.”

From a front-line standpoint, Finali Fernando, Managing Director, Regional Head of Products, CCO at HSBC, confirmed Sampath’s insights on core banking transformation, particularly the struggle to reconcile client needs and business growth with the ever-shifting regulatory landscape.

“As a consumer of IT, I’m caught between delivering for clients and

OUR CORE ASPIRATION HAS BEEN TO BUILD A ROBUST FOUNDATION FOR FUTURE TECHNOLOGIES, DRIVE PERVASIVE AUTOMATION AND CREATE AN EFFICIENT, SCALABLE OPERATING MODEL. AS A LEADER IN INNOVATIVE SOLUTIONS, FIRST ABU DHABI BANK, ALONGSIDE PARTNERS LIKE INFOSYS, IS COMMITTED TO PUSHING THE BOUNDARIES OF DIGITAL TRANSFORMATION

– Srinivasan Sampath

future-proofing our business while simultaneously dealing with regulatory pressures. We’re grappling with legacy systems, some over 60 years old, which are difficult to adapt. Building on top of such systems is like trying to modernise a dinosaur. The core challenge we face in our transformation efforts.”

Banks in the GCC region are pushing full steam ahead with the transition to an agile culture, removing barriers to cross-functional collaboration and creating semiautonomous teams that can deliver solutions quickly in alignment with enterprise strategy.

“We have faced significant regulatory demands in the UAE, including CPR, open finance, MPSS and IPP, all with aggressive timelines. The Central Bank of the UAE’s financial infrastructure technology transformation further adds to this. Balancing business needs with these regulatory requirements is a constant challenge,” said Sampath.

The new operating environment calls for financial institutions that can identify and swiftly respond to customer demands. Deloitte said that technology will continue to be the driver of business growth and central to delivering a wide range of services through strong customer experience.

“We have progressed through four industrial revolutions: steam, electricity, information and now digitalisation, with AI on the horizon. The evolution has accelerated dramatically, moving from the information age to the digital age in just 25 years,” said Hani Idris, the Chief Executive Officer of International Development Bank.

“A critical observation from my experience is that many banks approach digital transformation as an IT-driven initiative, neglecting other key stakeholders: the organisation, employees and customers. While technology is essential, innovation and cultural change are equally vital.”

The breakneck speed of technological advancements is fuelling the rapid proliferation of new business models. To remain competitive, especially as a future-focused bank, financial institutions in the GCC region are prioritising agility over size, actively embracing change and utilising digital tools to drive innovation through swift, decisive cycles.

“From a ‘Lego brick’ perspective, banks with numerous projects need to find efficient solutions rather than simply adding more complexity. A key challenge is leveraging the dynamic fintech

landscape,” said Michael Hartmann, Head of Open Banking and Open Finance at ADCB.

“The focus should be on building mature partnerships to accelerate market delivery, which means moving beyond internal development and collaborating with external partners to deliver valuable propositions to consumers.”

Hartmann said the Middle East region is at an interesting juncture, being open to external inspiration and developing its standards.

“Specifically, with open finance, the challenge lies in adopting a modular, ‘Legolike’ approach to innovation, partnering with systems integrators and solution providers. The core question for banks is how to implement this collaborative approach effectively.”

Digital transformation, while not a new concept in banking, has become

WE UNDERSTAND THAT FOR MANY INCUMBENTS, DIGITAL TRANSFORMATION IS FUNDAMENTALLY ABOUT DISMANTLING THOSE LEGACY CONSTRAINTS AND MODERNISING OPERATIONS. HOWEVER, FROM OUR VANTAGE POINT, TWO CORE CHALLENGES REMAIN UNIVERSAL ACROSS ALL BANKS – ACHIEVING SEAMLESS SYSTEM INTEGRATION AND DRIVING OPTIMAL TECHNOLOGY

– Mohammed Wassim Khayata

INVESTMENT RETURNS

increasingly vital as fintech and new operating models reshape the industry. Traditional banks are now compelled to continuously adapt to the evolving market and customer needs, notably the increasing reliance on mobile and online platforms for transactions.

“Banque Misr, with nearly 50 years of presence in the UAE, carries a significant legacy. We’ve recently begun migrating from on-premise to cloud, aligning with our digital transformation journey,” said Imran Kannuti, Head of Operations Digitalisation & Transformation at Banque Misr.

“To address how banks can realign business models to leverage digital technologies and meet customer expectations, several factors are crucial. First, banks must genuinely prioritise customer needs. A customer-centric approach will naturally shape the strategy.”

Kannuti underscored that banks placing customers at the centre will develop strategies that drive transformation, enabling them to adopt effective business models.

The GCC financial services industry is witnessing a large-scale digital transformation, with new technologies enabling banks and other financial services provider providers to revolutionise their operations and discover advanced methods of engaging with their clients.

Driving operational efficiency

Historically, banking has been associated with cumbersome, time-consuming processes and excessive paperwork.

However, the emergence of fintech and digital-only banks has fundamentally shifted customer expectations, with a strong preference for the convenience, speed and accuracy of digital banking services.

“At the National Bank of Oman in 2021, we initiated a strategy with nine pillars, including digital transformation and channel development. Our digital operating business model comprises six pillars: new-to-bank customer acquisition, customer experience, cost optimisation, revenue generation, liability generation and compliance,” said Dr Ali Al Shekaili, AGM - Head of Digital & Channels Retail & Digital Banking at National Bank of Oman (NBO).

“Digitisation allows us to offer 24/7 services, a significant advantage over traditional branch operations. Despite being a 52-year-old legacy bank, we have successfully migrated a substantial portion of transactions to digital channels.”

Al Shekaili said NBO has achieved significant digital adoption: 96% of cash withdrawals, 95% of cheque deposits and 99% of payments are now conducted digitally.

GCC banks face a critical imperative: they must take decisive action to boost revenue and profitability, enhance customer experience and establish a robust, differentiated market presence. The evolving operating landscape and push toward innovative technology make it imperative for financial institutions to grow.

Pradeep Negi, Senior Vice President of Payment & Compliance Portfolio Delivery at RAKBANK, said that the

UAE bank is focusing on four key areas: streamlining processes, reducing costs, improving service delivery and enhancing reusability and efficiency.

“Regarding these points, a significant portion (40%) relies on the Information Technology (IT) model. While it’s crucial for IT to be involved in business model creation, IT should also define its own model, inviting business participation,” said Negi.

“One effective model is the platform model, where all changes and APIs are consolidated under one umbrella, enabling component reusability for process streamlining and cost reduction.”

The digital transformation of banks is not a one-off happening. You have to feed it on an ongoing basis with a varied diet of evolving technology, changing customer needs, new regulations and industry standards.

To truly revolutionise banking, digital transformation must be holistic. Effective banking digitalisation requires building a single, integrated online platform that simultaneously enhances customer experience and streamlines internal processes.

“While AI-driven solutions are valuable, the most critical aspect is building modular and flexible systems,” Burcin Yavuz, Chief Design Officer at Wio, said, adding that even as a young bank, Wio is experiencing the challenges of legacy systems.

Yavuz highlighted that modular design allows for easy adaptation as technology evolves; with the pace of technological change accelerating, flexibility is essential to maintain control.

“We need to optimise both internal operations and external service delivery. Internally, we aim to streamline processes, reduce friction and accelerate decisionmaking. Externally, we want to minimise customer effort and time.”

Key industry players have said that achieving holistic digitalisation requires the strategic deployment of emerging technologies such as agentic AI, GenAI and blockchain, which are backed by strong institutional commitment throughout the organisation.

Digitalisation has revolutionised banking operations by automating routine tasks, freeing up the workforce to focus on higher-value activities, leading to substantial cost savings, improved operational efficiency and reduced the likelihood of human error.

Somu Roy, managing director of the UAE at Network International, concurred with Kannuti that robotic process automation (RPA) is significantly transforming banking. “Mundane tasks such as chargebacks,

traditionally manual and time-consuming, are now automated, improving efficiency,” said Roy.

“Real-time data streaming is another critical advancement. Banks are moving towards instant, in-app instalment options, eliminating the need for manual phone calls. However, traditional practices and commission structures sometimes hinder this progress.”

Roy pointed out that despite the superior digital experience offered by neobanks, regulatory requirements, such as the need for manager’s cheques, which neobanks like Wio lack, compel customers to retain accounts at traditional banks.

Automation technologies in banking and finance have markedly reduced workforce response times while boosting productivity and digital transformation, and improved most banking and financial services from the front to the bank office.

Banks in the GCC region are leveraging innovative technologies such as AI to streamline operations and improve

THE MODERN BANKING MODEL IS FUNDAMENTALLY RELIANT ON UNDERLYING TECHNOLOGY. IF CORE BANKING SYSTEMS WERE TO FAIL, ALL OPERATIONS WOULD CEASE. THEREFORE, TECHNOLOGY UNDERPINS BOTH A CUSTOMER-FIRST APPROACH AND BUSINESS GROWTH

– Gyan Prakash Srivastava

efficiency, driven by the transformational technology’s potential to automate routine tasks, optimise resource allocation and ultimately, reduce operational costs.

A strategic differentiator

With growing digitalisation in the financial services sector, the way we bank is projected to undergo massive transformation over the next decade. The bank of 2030 will look and operate very different from today.

“Commercial Bank of Dubai (CBD) has undergone a massive digital transformation, replacing virtually every core banking platform in the past few years. We’ve reached a point of stability, but a key challenge remains - maximising the value of these new platforms,” said David Kelly, the Head of Financial Infrastructure Transformation at CBD.

“The true value of these platforms remains hidden in their unused features, and empowering business users with the necessary knowledge is crucial for unlocking their transformative potential in daily operations.”

Kelly said that true transformation lies not just in implementing innovative platforms but in empowering our teams to master them, leading to operational excellence and a vastly improved customer journey.

Growing competition from fintechs and neobanks, also known as digital attackers, emphasises how banks currently fall short of providing superior customer experiences. Customers expect personalised engagement from all businesses they deal with, including banks.

From a customer experience and competitive edge perspective, Madhavi Bhatia, Global Business Strategy & Compliance Leader, said that the rapid integration of DeFi, digital currencies, blockchain and crypto demands immediate adaptation; these technologies are not on the horizon but actively shaping the market.

“Traditionally, customers in the UAE must manually manage their finances across multiple bank accounts, deciding when and how much to save. Revolut has automated this process, proactively optimising savings for their customers,” said Bhatia.

“While UAE banks are making progress in enhancing customer experience, they need to accelerate their adoption of such innovative solutions. The focus is shifting from customer experience to user experience, emphasising seamless and intuitive interactions.”

Bhatia emphasised that the focus is shifting from traditional customer experience to user experience, prioritising seamless and intuitive interactions,” adding, “We are moving towards a future where technology is deeply integrated into our daily lives.”

The bank of the future will provide a seamless and proactive customer journey, intelligently distributing personalised engagements and insightdriven solutions across a unified network of digital touchpoints.

BCG said that banks have become adept at focusing transformations on customer journeys – the process that customers go through to meet a need,

such as opening an account, borrowing money, or securing help with transactions or payments.

“At Commercial Bank International (CBI), as a corporate bank, we prioritise a targeted approach to innovation. We recognise that not all customers are the same and a blanket approach to technology implementation can be wasteful,” said Alex Bak, Head of Transformation at CBI.

“We understand that our corporate clients often value personalised service and immediate access to senior personnel. Therefore, simply implementing every new technology, such as GenAI, may not align with their needs.”

Bak underscores that CBI is focusing on advancing back-office processes, such as credit decisions, knowing your business and knowing your customer to enhance turnaround times. “These behind-the-scenes improvements are more impactful for our specific customer base than solely focusing on customerfacing digital solutions,” he added.

Banking customers, accustomed to mass personalisation from digital platforms such as Netflix and Spotify, now expect financial service providers to deliver equally personalised experiences. KPMG said that the bank of the future will be successful by being able to personalise not only their products and services towards the needs of the individual but also their experience.

Anand Krishnan, the Head of Technology at Emirates Investment Bank (EIB), said banks are now focusing on building collaborative ecosystems

where they can leverage the agility and innovation of fintechs.

“The partnership model allows banks to access cutting-edge technology while maintaining the trust and regulatory compliance that customers expect,” Krishnan said, adding that by creating fintech ecosystems, banks can offer specialised services to meet niche customer requirements while remaining protected by established regulatory frameworks.

“Beyond ecosystems, the ability to effectively utilise customer data is the next major differentiator for banks. Leveraging data and customer insights is crucial for personalised service delivery.”

A fully digitised customer journey hinges on developing a robust, dataand analytics-driven digital experience, enabling personalised interactions, operational efficiency and customer convenience while minimising costs.

Mashreq, through its payments division, is prioritising customer experience enhancements, as Zameer Ajaz Punjabi, Vice President, Product Owner, explained, with a balanced focus on internal and external stakeholders.

“While our primary focus is on external customers, who drive sales and revenue, we recognise the critical role of operational efficiency in shaping the overall customer experience.”

Punjabi said that Mashreq recently automated its payment information request process, which was previously manual. “The process involved transforming a process where requests from correspondent banks required

multiple touchpoints and delays. Now, customers can view requests, respond and track payment status directly through our app, significantly improving turnaround times,” he added.

Customers are now clamouring for the same level of sophistication, immediacy and personalisation in their interactions with banks as they do in other industries. Industry experts say banking customers are willing to share their data if assured of receiving personalised services.

“Over the past three years, RAKBANK’s transformation has been driven by a customer-centric approach, focusing on a seamless, end-to-end experience,” said Tapas Mondal, the EVP - Head of Architecture, Strategy & Design, IT at RAKBANK.

“When transforming a customer journey, like onboarding, we prioritise the customer’s initial interaction through the app or other channels. We then ensure that the entire process, including

WHILE UAE BANKS ARE MAKING PROGRESS IN ENHANCING CUSTOMER EXPERIENCE, THEY NEED TO ACCELERATE THEIR ADOPTION OF SUCH INNOVATIVE SOLUTIONS. THE FOCUS IS SHIFTING FROM CUSTOMER EXPERIENCE TO USER EXPERIENCE, EMPHASISING SEAMLESS AND INTUITIVE INTERACTIONS

Madhavi Bhatia

–

To meet the self-service expectations of today’s banking customers, GCC banks are actively deploying advanced technologies, including integrating AI into services and products, enhanced natural language processing and business process automation – all aimed at providing a more effective and contactless customer experience and giving customers greater control.

operations, risk and compliance, is streamlined for a seamless experience.”

Mondal said RAKBANK’s goal is to eliminate unnecessary friction and outdated processes, leveraging modern technology and data-driven decision-making.

“RAKBANK’s transformation involves collaboration across departments, including technology, design, operations,

risk and compliance. The inclusive approach has been truly transformative for our staff,” he added.

McKinsey said that customer experience is proving to be the strategic differentiator for banks, with experienced leaders outperforming laggards.

Customer experience has become the key competitive advantage in banking and with clear benefits. Financial institutions focused on enhancing customer experience consistently achieve higher customer recommendation rates, expanded wallet share and improved cross-selling and upselling success.

Sandeep Dhawan, Regional Head of Products – Payments at JP Morgan Chase Bank, said that banks operate within a strict compliance framework. However, “I believe that regulators can sometimes slow down innovation.”

“To address regulation hurdles, JP Morgan created Onyx, a separate entity that operates outside traditional banking regulations. It’s not bound by central bank oversight in the same way as our core business, allowing us to experiment and innovate freely,” said Dhawan.

Dhawan emphasised that while regulation is necessary, there are ways to foster innovation within a banking environment. “Creating separate, less regulated entities can provide a space for developing and testing new technologies,” he added.

IBM said that banking customer experience is a comprehensive measure of how customers perceive and feel about every interaction with their bank, including all stages of their journey, from

initial account setup to ongoing financial service utilisation and support.

To thrive in the face of growing competition, meet the growing demand for personalised service and ensure that products and services meet customers’ evolving needs, banks must proactively advance customer experience to build trust and attain a strong competitive position. Banks in the Gulf region are balancing the need for brick-and-mortar branches for complex transactions with substantial investments in tech-powered solutions to meet customer expectations.

Unlocking value through data

The initial phase of digital transformation has proven that traditional banks can compete with fintech challengers. However, the next phase of competition will be defined by innovation. Once digital infrastructures are universally adopted, it will be the ability to innovate that secures lasting consumer trust and satisfaction.

Ronit Ghose, the Head of Future of Finance at Citi, said banks should focus on eliminating customer irritations through effective data analytics.

“Building on nearly 30 years in banking, I have observed firsthand how banks often create frustrating experiences for clients,” said Ghose.

From a client perspective, Ghose said that as a customer of four UAE banks, I have encountered numerous pain points even with Citi; “despite the talent that the bank has attracted, I find our internal systems to be incredibly non-intuitive.”

“These experiences highlight the need for banks to prioritise user-centric

design and leverage data to identify and eliminate customer irritations. By focusing on simplifying processes and improving usability, we can significantly enhance the overall banking experience.”

Ghose stressed that banks often fail to use data to improve the client experience despite having vast amounts of customer data.

“While fully autonomous AI is unlikely to be approved by regulators soon, we can leverage agentic AI – smarter bots that bridge the gap between simple rulebased systems and full autonomy. The innovative technology, powered by data and analytics, can significantly improve customer experience,” he said.

The vast historical data accumulated by incumbents, spanning decades, provides them with a significant edge over fintech firms in understanding and building enduring customer relationships.

Data is power. To remain competitive against tech giants, global banks and agile fintechs while simultaneously delivering personalised customer experiences, financial institutions in the GCC region are overcoming the pressure of scaling by strategically leveraging data through modern core banking systems.

Gyan Prakash Srivastava, the Head of Data Analytics and AI at Mashreq, observes that data is often treated as an afterthought for any digital transformation, upgrade or system migration.

“When I joined Mashreq four and a half years ago, while digitalisation was already underway and crucial for navigating the pandemic, I recognised a critical gap: data’s potential was being underutilised,” said Srivastava.

“Previously, data was primarily used for post-transformation reporting and analysis – P&L, basic reporting, etc. We shifted this paradigm by embedding data into the very fabric of every transformation initiative.”

Srivastava said Mashreq’s focus is on infusing AI into every process to drive efficiency and reduce costs, including automated services like booking airport taxis for our Solitaire cardholders,

eliminating the need for customer service calls.

“The strong digital foundations we built, coupled with data and AI, have enabled us to rapidly expand into new markets like Pakistan, Oman and Egypt. We plan to continue this expansion throughout the year.”

Data-driven financial institutions are poised to dominate the future of banking, excelling in both core digital services and transformative innovation by building a foundation of data modernisation, robust infrastructure, exceptional digital solutions, strong governance and a results-focused mindset.

Banks in the GCC region are increasingly leveraging data beyond operational improvements, driving strategic growth by identifying new revenue opportunities, personalising customer experiences, making data-driven decisions and refining product offerings.

“Regarding the cost of AI, we have observed a global trend: many AI pilots, often mandated by CEOs, have faced escalating expenses leading to a re-evaluation: is GenAI always necessary, or can simpler technologies such as predictive analytics and machine learning effectively solve many problems?” said Nair.

He highlighted that the key is to match the complexity of the solution to the complexity of the problem while noting that with the rapid pace of technological advancement, with companies such as DeepSeek driving down costs, AI implementation will become more affordable.

With a data-first approach, banks and other financial institutions can strategically diversify their product portfolios and by leveraging transaction and behavioural data, they are uniquely positioned to achieve substantial revenue increases.

“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,” said BCG.

Banks are shifting from generic services to hyper-personalised

experiences powered by AI-driven insights. As financial institutions race to meet evolving customer expectations, outpace fintech disruptors and navigate regulatory complexities, leveraging data intelligently is no longer optional – it’s existential.

“While central bank mandates on open finance can create a standardised architecture, as we have seen in the UAE, this approach presents both advantages and limitations. It can streamline connectivity and reduce costs but may also restrict flexibility,” said Abdulla Mashaal, the Head of Open Banking at Emirates NBD.

“The success of UPI in India demonstrates the potential of standardised systems. However, the unit economics reveal a challenge: the low or non-existent fees may not provide sufficient incentive for all market participants,” Mashaal said while noting that for open finance to thrive, “we must consider not only the technology and customer needs but also the commercial viability.”

Data-driven financial institutions in the Gulf region are crafting tailor-made products and services by analysing transaction histories, spending patterns and customer preferences – allowing banks to boost customer engagement and loyalty while improving financial wellbeing through predictive insights and proactive financial advice.

“A significant challenge for global banks operating in diverse markets with legacy technology is balancing centralised platforms with local regulatory demands. Group-mandated platforms, while necessary, often lack the flexibility to adapt to specific regional regulations, creating a cost burden as banks struggle to meet compliance requirements without disrupting core systems,” said Sampath.

With the rise of instant payments and open banking, real-time data processing is essential. Banks are deploying AI and machine learning algorithms to assess creditworthiness instantly, detect fraudulent activities and automate compliance checks. The capabilities enable faster decision-making, reduce operational costs and improve risk management.

“From a market infrastructure perspective, decoupling architecture helps financial institutions adapt to regulatory requirements. However, true differentiation comes from the unique value a bank provides to its clients –something that is often overlooked,” said Ana Rita Sa, Head of Transaction Banking Product Management at ADCB.

“Take, for instance, the card industry. Both banks and card providers possess detailed data on consumer spending habits, yet the benefits remain largely the same – golf course access, airport lounges and car rental discounts.”

Banking operations are being revolutionised by data-driven automation, leading to improved workflow efficiency, reduced errors and cost savings. Chatbots and robotic process automation (RPA), powered by big data analytics, are streamlining tasks from customer service to back-office processing.

“While we, as bankers, delve into complex discussions about open finance and advanced technologies, we must remember that customers often desire simplicity,” said Khayata.

“Our most successful product was a simple, five-minute account opening process integrated with UAE Pass, resulting in over 50,000 onboardings. The success, mirrored in applications such as Wio, underscores the power of simplicity.”

Bankers and tech experts at the MEA Finance – Infosys roundtable agreed that the banking sector is undergoing a seismic shift as digital transformation and cutting-edge technologies dismantle traditional paradigms. AI, blockchain and cloud computing are no longer buzzwords but foundational tools reshaping how banks operate, compete and engage customers.

The profound transformation in the GCC banking sector isn’t just about tech advancements; it’s a cultural metamorphosis, redefining banking as a seamless, intelligent and inclusive experience.

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