Central Bank of Egypt: An unprecedented rise in financial technology investments, reaching 300%

Ayman Hussein, Senior Deputy Governor of the Central Bank for the Information Technology Sector, said that technology has become an essential part of our daily life, and a necessity imposed by the requirements of the present and the future, and the banking sector is fully aware of its importance and the ability of technology to achieve a leap in the efficiency and effectiveness of providing financial and banking services .

This came in his speech delivered today at the first Al-Ahram Financial Technology Conference, on behalf of the Governor of the Central Bank.

Ayman revealed that the volume of investments in the field of financial technology has made a big leap over the past five years, rising from $1 million with only 3 deals in 2017 to more than $159 million with 32 deals during 2021, as witnessed in the past 12 months. An increase in investments by more than 300%, which indicates the development and expansion of emerging financial technology companies operating in the field of financial technology.

The central bank's interest in digitizing financial services comes in light of the integration with the goals and vision of the National Payments Council headed by His Excellency President Abdel Fattah El-Sisi to transform a society less dependent on banknotes. A local system of its kind that is independent and capable of providing the same services of foreign payment networks effectively and efficiently, in a way that avoids the national economy any effects that may result from the disruption of these external networks for any emergency event.

The Deputy Governor of the Central Bank, Ali, stressed the tendency of banks to expand in providing more digital banking services, which strengthened the ability of the banking sector to overcome many obstacles that it was facing to provide banking services, and to reach all segments of society, which had Great impact in increasing the ability of the banking sector to respond quickly and flexibly to the requirements of the emerging Corona virus pandemic, as more than 1 billion electronic transactions worth 2.8 trillion Egyptian pounds were executed during the past year.

Ayman stressed the interest of the Central Bank of Egypt in laying the necessary legislative and regulatory foundations to support and stimulate the targeted digital transformation by allocating an entire chapter for payment systems and services and financial technology in the Central Bank and Banking System Law No. 194 of 2020, and the Central Bank of Egypt is currently working, in cooperation with the Authority Financial Supervision, to issue a new law to set the legislative framework required to benefit from alternative financing services, and financial technology activities related to banking services and to expand their provision to meet the needs of various groups in the Egyptian market.

In line with the efforts to achieve the targeted digital transformation, the Central Bank launched the regulatory laboratory for innovative financial technology applications as a disciplined testing environment that allows financial technology entrepreneurs to test their innovative applications, taking into account the full rights of customers.

Ayman revealed the unprecedented growth that Egypt has witnessed in the field of financial technology and the sectors feeding it over the past few years, as the volume of financial technology investments increased from $1 million in 2017 to $159 million in 2021, as witnessed by the number of emerging financial technology companies. A huge boom to rise from just two companies in 2014 to 112 companies in more than 14 innovative financial technology sub-sectors.

In parallel with this great development in financial technology, Egypt witnessed a significant increase in payment tools and electronic means of acceptance during the last period, which would support the transition to a digital economy and a society less dependent on cash, as the number of bank cards increased to about 54 million cards, including 22 million Meeza cards, and more than 25 million wallets have been reached with mobile phone wallets, in addition to the deployment of 740,000 electronic points of sale and more than 18,500 ATMs across the country.

Ayman said that the current year will witness the launch of many important projects related to financial technology, such as the launch of the real-time payments network soon, which represents an unprecedented boom in financial and banking transactions in the Egyptian market, as it will enable citizens to carry out their financial transactions and bank transfers between various accounts in All banks are available 24 hours a day, 7 days a week, even on holidays and vacations.

A technology and innovation support fund with a capital exceeding one billion and three hundred million Egyptian pounds will be launched (National Bank of Egypt, Banque Misr, and Banque du Caire), in addition to the opening of the Grid Financial Technology Center, which aims to promote and advance the financial technology system within the Egyptian market, and work To bring together all parts of the financial technology ecosystem under one roof.

Work is also underway to launch a system for electronic customer identification (EKYC), which will enable citizens to open their bank accounts electronically, without the need to go to the bank's headquarters, in addition to expanding the establishment of digital banks that provide banking services through digital channels or platforms using technologies modern.

There is no doubt that securing banking transactions and cybersecurity represents a major challenge in light of the digital transformation and continuous technological development, and from this standpoint, the axis of securing banking transactions has acquired a major priority within the central bank’s integrated vision to expand digital financial transactions, and this has been reflected To launch an integrated center for information security, full of trained cadres and competencies, as the center aims to enhance the ability of banking institutions to confront cyber threats, by formulating and launching many strategic initiatives to deepen awareness of the best solutions and highly developed cyber and security technologies, and keep abreast of best practices and international standards followed. In the field of secure digital transformation.