One of the major drivers that have propelled the UAE to become one of the most attractive investment destinations is the adoption of technology and innovation. Over time, the UAE has strengthened itself in every way possible by focusing on the non-oil economy and maximizing its potential. When it comes to financial investments, the United Arab Emirates is a major investment ground. Simultaneously, the region has established itself as one of the world's leading tech hubs. Technology has become an inseparable part of modern life and plays a critical role in a variety of business sectors.
HOW FINTECH STARTED
When it comes to the corporate world, the digital revolution has ushered in a sea change. Any business industry has the potential to be transformed by digital disruption. The financial sector, which is the backbone of any economy, is one such efficient sector. The financial industry has risen to new heights as a result of the infusion of digitalization, giving birth to FinTech, a combination of finance and technology. The implementation was done with a single goal in mind: to create a realistic path for financial markets and authorities to operate efficiently. Global investors consider the new FinTech diversion to be a golden investment opportunity, with a higher return on investment.
FINTECH IN UAE
The United Arab Emirates has taken a step toward bringing the finance and technology industries up to date. The government has taken the initiative of creating sector-specific zones to speed up the various business sectors. When it comes to financing, the UAE now has the Dubai International Financial Centre (DIFC), which is one of the region's most successful free zones.
Abu Dhabi, the UAE's capital, is one of the most attractive destinations for international investors. The Abu Dhabi Global Market (ADGM) is an internationally recognized financial centre in the United Arab Emirates. The centre is one of the most important pillars of Abu Dhabi's Economic Vision, which aims to improve the region's financial situation. The government has taken several steps to stimulate the FinTech industry and spread awareness among businesses.
The following are some key drivers of the FinTech industry:
Consumer Demographics
Internet & Payment Adoption
Consumer Attitudes
Regulatory Sandbox
Fintech Funds & Accelerators
Private Capital Availability
GOVERNMENT INITIATIVES
The MENA region hosted the leading FinTech and Financial event, which welcomed over 5000+ delegates from over 70 countries, making October 2019 a game-changer for the FinTech industry. More than 130 speakers were invited to contribute to the success of the event and the industry as a whole. The following are some of the event's highlights:
Find the most innovative FinTech talent from all over the world.
Companies that are shaping the FinTech industry's future were highlighted.
The financial challenges that businesses face are taken into account.
More than 2000 startups, scale-ups, and SMEs have used it as a business collaboration platform.
FinTech Abu Dhabi Awards were launched, setting a new standard for excellence in the field of fintech.
DUBAI INTERNATIONAL FINANCIAL CENTRE (DIFC)
The Dubai International Financial Centre serves as the foundation for the UAE's financial sectors. DIFC is a special economic zone that was established in 2002 and is one of the fastest-growing financial centers in the Middle East, Africa, and South Asia markets (MEASA). The center has its judicial system as well as a business framework that enables business professionals to conduct their activities with ease. The DIFC is an independent free zone that provides its valued customers with a wide range of options.
The DIFC's Business Structures
The following business entities are permitted to incorporate at the Dubai International Financial Centre:
A company with a share capital.
Limited Liability Corporation (LLC)
Recognized Business
Company for Protected Cells
A company that invests in the open market
A company with a General Partnership
Limited Partnership
Trusts
Limited Liability Partnership
Investment Trusts
Associations
Apart from finance, the DIFC provides numerous opportunities for business investors from various industries to come forward and invest in the area. The DIFC offers a variety of services, including:
Ultra-modern space options
Retail outlets
Cafes & Restaurants
Art Galleries
Residential Apartments
Hotels etc.
FinTech in DIFC
The digitalization of financial services is accelerating at an unprecedented rate. Understanding the growth potential, the DIFC has developed FinTech Hive, which streamlines the processes of financial institutions and insurance partners, allowing investors to enter the market and invest in the relevant domain. The DIFC offers a variety of services to encourage business investors to come forward and start a business.
PROCEDURE TO START A COMPANY
To start a business in the DIFC Free Zone, you must go through the following steps:
Complete the application form completely.
Make your way to the initial approval.
Keep your papers ready.
Make sure you have the required share capital on hand.
Now is the time to open a bank account.
DOCUMENTS REQUIRED
The following are the documents that must be submitted when forming a company in DIFC:
Procedures and controls to combat money laundering
The financial situation in the past
Internal auditing and compliance systems at the company
A well-structured business plan is essential.
Controls and information about the operating system
Information about the shareholders (identity and address proof)
A certificate of propriety confirms the institution's ability to conduct business.
The organizational structure of the proposed institution
Accounts of the shareholders for the previous three years audited
Benefits of Starting a Company
Because of the following advantages, international investors tend to choose the UAE as their ultimate investment destination:
1. Tax-Exemption
Corporate and income tax payments are one of the main concerns of business investors and owners. The ground of the UAE, on the other hand, allows business investors to come forward and take advantage of tax-free advantages. Personal taxation is completely exempt; however, the UAE government began implementing VAT procedures on January 1st, with a rate of 5%.
2. Compete Resettlement
The next advantage that business investors enjoy is that they do not have to pay any fees when selling their company. The total capital invested as well as profits earned can be repatriated, which is a bonus for business owner investors.
3. Various Location Alternatives
When it comes to business locations, investors have a variety of choices from which to choose the best location for their company. There are options such as Mainland, Free Zone, and Offshore; however, proper knowledge is required before selecting the best business location.
4. Quick Incorporation Procedure
For years, the process of forming a company has been perceived as simple. The government has simplified the business formation process to make it much easier for international investors to invest. The ease with which foreign investors can set up a company has piqued their interest, prompting them to invest.
5. Obtaining a business license is convenient.
It serves as a requirement to obtain a business license to conduct business activities. Currently, the region offers a variety of licenses to different business investors in a variety of industries.
These are the advantages that would greatly benefit an investor, providing numerous opportunities for them to earn higher returns on their investments. However, to make the incorporation process go smoothly, business investors tend to work with professionals who are well-versed in the legal aspects of the process.
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