Commentary | Hassan Radhi & Associates

Since its inception in 2006, the Central Bank of Bahrain (CBB) has relentlessly worked towards maintaining the monetary and financial stability in the Kingdom of Bahrain.

The CBB facilitates market innovation and encourages the use of training and technology to enhance the competitiveness in Bahrain’s financial sector.

One of the key recent developments in the financial sector has been the establishment of the Fintech & Innovation Unit by the CBB, which is dedicated to ensuring the best services to individual and corporate customers in the financial services sector by nurturing FinTech and innovation. The CBB’s FinTech & Innovation Unit is also responsible for the approval process to participate in the regulatory sandbox, supervision of authorised sandbox companies’ testing progress, monitoring technical and regulatory developments in FinTech – both regionally and internationally – in addition to taking the lead on strategic FinTech initiatives

The regulatory sandbox is a key tenet of this strategy and will allow FinTech firms and digitally focused financial institutions around the world to test and experiment with their banking ideas and solutions. The regulatory sandbox is a virtual space for both CBB-licensed financial institutions and other firms to test their technology-based solutions relevant to FinTech or the financial sector in general.

As part of the Global Financial Innovation Network, the Central Bank of Bahrain is inviting applications from firms wishing to test innovative financial products, services or business models across more than one jurisdiction.

Through initiatives like the regulatory sandbox, Bahrain has quickly become the Fintech hub of the Middle East. Bahrain FinTech Bay is the leading FinTech Hub in the Middle East and Africa. This is MENA’s most dynamic and diverse FinTech network, which provides a dedicated FinTech co-working space, with state of the art meeting rooms, innovation labs, acceleration programmes, curated activities and educational opportunities.

The CBB is continuously introducing initiatives to provide the right mix of policies and products to enhance the activity, funding, quality, and competitiveness of financial sector services. As a result of such initiatives, startup technology businesses, as well as leading-edge technology businesses are attracted to Bahrain as a domestic and regional base to pursue their FinTech strategies. This reflects positively on the availability of financial support services and thus, on the financial services sector in Bahrain.