Deputy Governor of CBE: Fintech investments have multiplied 12 times since 2017 to reach $167 million

Rami Abu el Naga, the Deputy Governor of the central bank of Egypt, said that he is very fortunate to be surrounded by an elite group of pioneers, reputable banks, and distinguished VC investors from all regions of the globe.

this was in the first Egyptian Venture Capital Summit which will held under the name and designation of "Your Investment Gateway to Africa & the Middle East Venture Capital Program”, in collaboration with GIZ Egypt, AfricaGrow, and organized by Changelabs.

This summit is convened in alignment with the directions of H.E. Mr. President Abdel Fattah Al-Sisi, President of the Arab Republic of Egypt, with the aim to provide an enabling environment for talented and innovative entrepreneurs, create new jobs for the future, and adopt more innovative FinTech and FinTech-enabled solutions capable of delivering banking and financial services to all segments of society more easily and at an affordable cost.

This summit is only a part of a sequence of endeavors that we have pursued to portray Egypt as “a regionally recognized hub for Venture Capital investments”, and  it also provides a glimpse of our efforts and vision to position Egypt as a regional gateway for the fintech industry in the Arab World and Africa

"Abu El Naga" said that he is quite confident to say that the Venture Capital investment space in Egypt is affirmative on its successful trajectory. The main reason behind all the success is the strong belief of empowering young talents and entrepreneurs for a promising future. 

Despite the serious macroeconomic challenges brought by the Covid-19 pandemic, Egypt was one of few countries that experienced a positive GDP growth rate in 2020. Egypt reaped the fruits of its successful homegrown economic reform program, which laid the foundation for the country to weather shocks, and thus register an impressive 8.3% growth rate in real GDP terms in the second quarter of the fiscal year 21/22. 

As for the financial inclusion strategy, CBE has successfully achieved an inclusion rate of more than 56 percent. In addition, CBE is very keen on supporting the expansion of technology, cybersecurity, e-payment and digital transformation, as well as fostering the Startups and small businesses community in Egypt who play a key role in realizing economic and social development, additionally, they help to cater for the needs of the local market.  Noting that the startup scene in Egypt has been noticeably growing over the last few years. To date; according to the Egyptian Startup Ecosystem Report for 2021, Egypt is home to a total of 600 Tech startups. And more specifically, according to FinTech Egypt’s latest report, the FinTech ecosystem grew in a rapid pace, where as we speak, Egypt has around 150 innovative and young FinTech and FinTech-enabled startups, service providers and enablers.  Egypt has achieved rapid growth in venture capital investments in the field of FinTech & FinTech-enabled industry over the past years reaching a new high of $167M only in the first half of this year; which has increased by 12 times compared to 2017.  And yet more to come; as we speak; close to 110 FinTech & FinTech-enabled startups and payments service providers are looking forward to raise funds in the next 12 months with approximate amounts exceeding half million dollars.   Looking ahead, constant regulatory developments are the priorities of the CBE’s agenda to guarantee the long-term growth of the FinTech industry and its VC investment environment, with the help of strategic enablers such as, establishing digital financial infrastructure, endorsing innovative young entrepreneurs, amplifying legal and regulatory bases, and bolstering FinTech investments.  This is well proved witnessing the recent launch this year of Nclude; the FinTech and FinTech-enabled focused fund by the 3 commercial banks; Banque Misr, National Bank of Egypt, and Banque du Caire along with E-finance Investment Group and Egyptian Banks Company (EBC). This fund aims to be the largest Fintech-focused fund across the Middle East and Africa region with target capital of $150 million.  In addition to “Avanz Manara fund of funds” that included investors of 7 commercial banks in Egypt and different financial institutions; and aiming to invest in private equity & venture capital funds that seek to invest in SMEs, with total targeted investments amounting to more than $100 million. All demonstrating the bold and unprecedented steps taken by the commercial banks in Egypt who are laying the foundation for the vital role and progressive strides that all banks and financial institutions operating in Egypt should take on board towards advancing innovation in the financial services industry, and supporting the Fintech startups. We look forward to demonstrating the vital role played by Venture Capital (VC) Funds which are actively involved in the asset-class investment scene, supporting startups, entrepreneurs, and promising enterprises to develop and grow. Thus, I am reaffirming the central bank of Egypt’s mandate and resolutions to guarantee that Egypt holds its position as a prime regional investment market, and today’s event is an important benchmark in this journey, and a step towards fostering an ecosystem that attracts foreign investors and innovative young entrepreneurs. Which is an integral part of CBE’s FinTech & Innovation Strategy objectives I hope that the coming days will witness the attraction of more VC investments and fruitful partnerships happening in Egypt, and that’s the core objective of our presence here within the next 2 days.