Dubai’s rapidly growing fintech sector has enjoyed soaring investment over the past five years, so there’s never been a better time to launch a fintech business here. But, to succeed, you will need to ensure that you meet regulator requirements – and for that, you’ll need a fintech license. If this is your first time applying for a fintech license in Dubai, this article should help.
What is a fintech license?
Anyone wanting to build a fintech company in the UAE will need a license to legally operate their business. This type of commercial license is granted by the UAE government and covers a wide range of services, from digital payments and blockchain technologies to insurtech and neobanks. There are a variety of different licenses to choose from, depending on the type of business you choose to operate. Remember, you will need to meet specific criteria set by the relevant regulator to obtain the license.
How to get a fintech license in Dubai: Step-by-step
If you’re hoping to leverage Dubai’s advanced infrastructure, progressive regulatory environment and rapidly growing demand for fintech services, getting a fintech license should be your first step. While the process is relatively straightforward, you will need to follow specific legal and regulatory requirements.
We’ve broken down the process into five steps:
Step 1: Prepare your business plan
Fintech might offer boundless opportunities for entrepreneurs, but only those with a strategy will be able to make a successful and sustainable business. To do this, you will need a comprehensive business plan that outlines your services, target market, infrastructure requirements and projections. Not only will this prove useful for you and your team to refer back to, it will provide the necessary evidence for regulatory authorities to approve your license. Think about the specific fintech services you will be providing and provide details on customer demographics, local trends and potential competition. Fintech is an infrastructure-intensive market, so you will also need to provide details on how you plan to use specific technology and customer data.
Step 2: Choose a jurisdiction
Before applying for a license, you will need to choose whether to operate your company in either a free zone or the mainland. Both offer significant advantages to entrepreneurs. Operating a mainland business is best for those who plan to offer products and services to the local UAE market. If you have a more global strategy or simply want to operate your business within the free zone, a free zone license might be best. These offer a whole string of benefits, including tax exemptions, 100% foreign ownership and repatriation and a streamlined setup process.
Step 3: Register your business
You will need to register your business in your chosen jurisdiction. Choose a name that reflects your business and also adheres to the UAE’s naming laws. It should not contain abbreviations, blasphemous language or potentially offensive terms. Be aware that it may be rejected if it is too similar to an existing business name, so always check beforehand.
Step 4: Apply for your license
You will need to complete an application for your fintech license. At Set Hub, we can help you navigate this process to ensure that you have all the correct supporting documentation to ensure a swift sign-off. This includes detailed information about your business and services, key supporting documents like a business plan, passport copies proof of address, and proof of financial requirements.
Step 5: Pay the fees and receive your license
Licensing fees depend on the type of business, issuing regulatory authority and the size of your operations. You may also need to pay an additional fee for specific services, like cryptocurrency operations.
Once your license has been approved and you have paid your fees, you can legally operate within the UAE.
Benefits of starting a fintech business in Dubai
Dubai is one of the best cities in the world for entrepreneurs specialising in fintech services and products for a whole host of reasons:
Robust digital infrastructure and connectivity
Dubai boasts cutting-edge digital infrastructure – perfect for fintech companies that rely on technology to drive impactful services. This includes ultra-fast and reliable internet connections and data centres. Dubai is also committed to becoming a “smart city” and has introduced a string of initiatives to help fintech startups integrate more easily with other tech sectors.
Supportive regulatory environment for fintech
Dubai offers generous tax policies, with tax exemptions for fintech companies operating in specific zones. There are also specific regulatory frameworks for asset activities.
Access to emerging markets
Dubai is located at the gateway between East and West, with easy access to emerging markets in Africa and Asia, as well as Europe. It’s also the perfect launchpad for those looking to expand into the Middle East North Africa (MENA) region, and neighbouring markets in Saudia Arabia and Qatar.
Innovation-centric ecosystem
Dubai is a global hub for startups and entrepreneurs, with dedicated networks, accelerators and funding programmes for small, innovative businesses.
Wide pool of talent
Dubai is home to a diverse expat workforce, with a growing community of software engineers, blockchain developers and AI specialists from all over the world.
How to scale a fintech business in Dubai
It’s one thing to launch a business, but how do you ensure it succeeds? You need a comprehensive growth strategy. Here are three tried-and-test strategies for scaling your fintech business in the UAE:
Expand into emerging regional markets
Dubai is the ideal base from which to expand into neighbouring markets. Once you’ve established your business in Dubai, consider expanding into other GCC countries where demands for fintech services are on the rise.
Partner with leading financial institutions
Dubai has a well-established financial sector of banks and institutions. By partnering with these businesses you can increase your reach and boost credibility. These sorts of partnerships could range from partnering with banks for local digital payments to collaborating with insurance companies to provide innovative insurtech solutions.
Build a strong brand presence
It’s no secret that fintech offers lucrative opportunities for entrepreneurs, so the landscape is becoming increasingly competitive. Stand out from competitors with effective digital marketing and traditional advertising campaigns, and tap into networking opportunities that will give you the chance to meet clients, partners and investors.
About Set Hub
Set Hub is a leading business setup consultancy in Dubai. For over a decade, we have helped shape countless success stories in the UAE’s business landscape and served over 25,000 clients. We do this by delivering transparency, expertise and an unwavering commitment to your vision. Our offices are based in the UAE but our team of over 80 speak 23 languages between them, offering a truly global approach. Our services encompass business setup, residency, office spaces, banking and taxation, and documentation, to ensure that you can focus on what’s important – business, not paperwork.
If you are looking for a trusted partner for your fintech business or want to learn more about how we can help, get in touch with us today.
