The Evolution of Islamic FinTech and Its Economic Implications in the Middle East and North Africa

Abstract

As the world evolves rapidly, so does financial technology (FinTech), reshaping the landscape of Islamic finance in the Middle East and North Africa (MENA). This paper investigates the transformative role of Islamic FinTech in fostering economic resilience and advancing ethical finance practices across the region. The relevance of Islamic FinTech lies in its ability to address critical global challenges, such as financial inclusion, through its alignment with Shariah principles. However, its development faces limitations in regulatory frameworks and cross-border interoperability, which constrain its scalability. Key questions addressed include: How does Islamic FinTech contribute to strengthening entrepreneurial ecosystems in MENA? What are the barriers to integrating Islamic FinTech with traditional financial systems? A qualitative exploratory method along with in-depth literature review analysis, is employed to evaluate FinTech’s impact on innovation, market growth, and regional economic stability. Findings highlight the need for dynamic regulatory frameworks and robust public-private partnerships to facilitate adoption. This study underscores the potential of Islamic FinTech to revolutionise finance in MENA, creating opportunities for future research into its long-term socio-economic effects and exploring synergies with emerging technologies such as blockchain.