The Middle East and North Africa (MENA) region is among the last untapped payments markets. Despite limited financial infrastructure, regional economic growth and progressive regulatory frameworks lay the foundation for industry-wide innovation. In this article, we will analyse the emerging payment trends and the regulatory landscape in the region.
Cash remains a popular payment method in MENA. Governments have made significant investments in digital transformation, with finance and payment innovation at the forefront. The tide is changing, as a wave of digital payment options launch and gain traction. Consumer expectations have shifted as digital transactions become the default, with 85% of MENA consumers using at least one emerging payment method in 2022. Digital adoption was reinforced through the necessary shift away from cash during the pandemic years. In Bahrain, e-wallet transaction volume tripled in 2021 from the previous year. In 2022, 90% of Egyptian consumers surveyed used an emerging payment method. For the 2022 FIFA World Cup, Qatar introduced a world-first, ‘Pay with your face’, which enabled face biometrics to authenticate transactions.
MENA tracks global trends, shifting towards real-time payment (RTP) solutions – with the market’s compound annual growth rate (CAGR) at 30.6% expected to total USD 2.6 billion by 2027. Local governments introduced instant payment schemes, integrating seamlessly into the local bank transfer systems. The Central Bank of the UAE launched its Instant Payment Platform (IPP). Similarly, Saudi Arabian Riyal Interbank Express (SARIE) supports instant payments in the Kingdom of Saudi Arabia, Fawri+ in Bahrain, and the Instant Payment Network (IPN) in Egypt. They operate 24/7 and in near real time, settling payments within 30 seconds. Adoption is high at this early stage, given that transactions are automatically processed in real-time when falling within the schemes’ limits. Ultimately, customers benefit without changing the existing behaviour. The region has also witnessed benefits since the rollout, such as improved operational efficiency and a surge in ecommerce activity.
MENA is one of the largest outbound remittance markets in the world. It comes as no surprise, given that the Middle East is a global expatriate hub. The Gulf Cooperation Council (GCC) is home to 35 million migrant workers – attributing to 10% of global migrants. This trend shows no sign of slowing down. For example, Dubai’s Urban Plan intends to double the current expat population by 2040, and Saudi’s new development, The Line, is set to attract nine million people by 2045. Flowing across the GCC alone, there are 2.3 million transactions annually valued at over USD 2 trillion. With a clear demand for regional cross-border payments, the Central Banks have collaborated to develop regional networks to move money seamlessly. Both launched in 2020, the AFAQ and BUNA networks enable regional fund transfer – without interfacing with the SWIFT network – reducing time delays and high transaction costs. In 2023, BUNA launched its instant payment method to further integration within the network. Opportunities remain to continue developing cross-border payment networks between the region and the rest of the world.
On the surface, MENA regulations appear to align with those in the UK or Europe, often sharing a name or terminology. However, local regulations differ from regimes elsewhere. The challenge is understanding the nuances of local regulations against the backdrop of regulatory trends. Each local market has its own regulatory framework, which may differ from other regional markets. To encourage innovation, regulatory sandboxes have become popular for fintechs to test and launch quickly (such as in Saudi Arabia and Egypt), as well as legislative amendments to include e-money and payment institutions.
To operate in a local market, companies are required to set up a local entity, invest in a local compliance team, and acquire a local licence. It demands time, financial investment, and deep-rooted market knowledge. The MENA region also faces unique compliance risks, so regulators are focused on ensuring companies understand the ecosystem, especially given the region’s dependency on the US financial system.
An additional consideration for international companies is establishing on the mainland or in an economic-free zone. For example, the UAE has two routes for payment regulation: companies can pursue an onshore licence from the Central Bank (CBUAE), the federal regulator; alternatively, they can obtain an offshore licence from the Dubai Financial Services Authority (DFSA) or Financial Services Regulatory Authority (FSRA) to operate in the DIFC or ADGM free zones, respectively. The decision requires deep insight into the benefits and requirements for either regulatory route.
This editorial piece was first published in The Paypers' Global Ecommerce Report 2025, which provides a complete overview of key trends and strategies to help businesses worldwide succeed. Download your free copy today to explore in-depth insights on global ecommerce trends, the latest innovations in payment solutions, and strategies to stay ahead in a competitive market.
George Davis is a serial founder. After starting his first business at the age of 18, George has gone on to lead payments at TrueLayer – launching payments for global fintechs such as Revolut, Freetrade, and Trading 212, and Paymentsense, and later co-founding global cross-border payments business BVNK as Chief Product Officer. Whilst building payments globally, George saw the opportunity to develop a Middle Eastern solution. This led him to found Fuse.
Fuse is a cross-border infrastructure business focussed on enabling global companies to make payments in, out, and around the Middle East. Without the need for local licensing, entities, bank accounts, or currency management, Fuse customers can open unlimited Virtual Accounts in the name of their end customer that can interact with local instant payment schemes and the global SWIFT network. Fuse is the first to bring Virtual Accounts, combined with a global foreign exchange network, to the Middle East and North Africa.
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