Israel and Bahrain have signed a cooperation agreement to enhance their fintech sectors. The Israel Securities Authority and the Central Bank of Bahrain inked the agreement during the visit of Israel’s Foreign Minister Eli Cohen to the Gulf nation. The deal aims to promote innovation and provide regulatory support to fintech companies in both countries.
As part of the cooperation, regulatory authorities in both nations will collaborate to provide guidance and support to fintech startups, especially those in the developmental stages or in the initial approval process. This includes sharing information and knowledge to foster innovation in the financial services sector and facilitating regulatory access for entrepreneurs looking to expand their financial services globally.
Israel and Bahrain normalized diplomatic ties in 2020 under the US-brokered Abraham Accords. This agreement paved the way for cooperation in various fields, including trade. The current fintech collaboration underscores the commitment of both countries to strengthen economic and civil ties.
With its supportive legislation and taxation policies in financial services and investments in technology, Bahrain offers an attractive environment for Israeli startups seeking business partnerships. Additionally, Bahrain serves as a gateway to the Cooperation Council for the Arab States of the Gulf, which includes Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.
Yosef (Seffy) Zinger, incoming chairman at the Israel Securities Authority, commented on the importance of the collaboration, saying, “Israel is a financial tech powerhouse, and we see great importance in building bridges to support the global activity of Israeli companies in this industry.” Zinger highlighted ongoing efforts in Israel to promote digital financial services through open banking reforms.
Israel’s fintech sector has experienced substantial growth, with the country home to approximately 550 fintech companies and 20 unicorns valued at over $1 billion. The sector attracted $7.2 billion in investments in 2021. However, in 2022, capital raising slowed to $2.7 billion amid market fluctuations.
The cooperation between Israel and Bahrain aims to further propel the fintech industry in both countries, benefiting from their unique strengths and fostering innovation in the financial services sector.
