Stripe is expanding its operations into the Middle East with an official launch in the United Arab Emirates (UAE). With the opening of its new office within the Dubai Internet City, the payment processing giant – valued at about $95 billion – will be taking an important first step in doing business in the region.
According to Matt Henderson, the EMEA business lead at Stripe, the major reasons for the company’s expansion into the region are the “internet-savvy consumers”, “pool of tech talent”, and “strong investor appetite” in the Middle East.
Stripe’s Middle East operations will cover two broad services; accepting payments on behalf of UAE-based businesses, and facilitating payments from its UAE customers to its other customers across the world.
The press release to announce Stripe’s launch makes mention of meeting platform Aceplace, accounting software firm WeKeep, online restaurant hub ChatFood, and travel marketplace Illusions Online, as the company’s pre-launch beta testing customers.
Through the beta, Illusions Online was able to launch a new vertical tagged ‘iOL Pay’ across 40 countries and in 135 currencies. Faisal Memon, founder, and CEO of Illusions Online maintains that iOL Pay is a “payments platform-as-a-service” solution.
According to a blog post published by Stripe on Monday, over 10,000 companies showed interest in the UAE launch. The company also stated that “Stripe will initially queue invites to manage demand levels during the first weeks of availability in the UAE.”
UAE – A Fast-growing Market
Apart from being a top market for remittances, the Middle East is also one of the fastest-rising e-commerce markets. This means the payments business in the UAE can be very lucrative.
According to the World Digital Report 2021, research commissioned by the Telecommunications and Digital Government Regulatory Authority in the UAE, digital payment transactions carried out in the country during 2020 reached $18.5 billion, with individuals spending an average of 7 hours and 24 minutes every day on the internet. This solidifies the UAE’s status as one of the countries with the highest smartphone penetration rates in the world. Global Media Insight data from 2020 says over 9 million people in the UAE (about 92% of the population) use mobile internet.
According to Ammar Al Malik, the Managing Director of Dubai Internet City; “Stripe’s expansion to the UAE strengthens Dubai’s status as one of the world’s leading destinations for tech-enabled businesses.”
He stresses that Stripe’s “arrival also bodes well for the growth and acceleration of the digital economy” in what he maintains is still a “young region”. By virtue of the company’s partnership with Network International, its market entry is secure.
New Country Launches
In 2020, Stripe announced a series of launches in different countries, including Hungary, Bulgaria, Czech Republic, Malta, Cyprus, Romania, and Nigeria where it acquired Paystack for $200 million.
In March 2021, Stripe got another $600 million in a funding round, which increased its value to $95 billion and made it one of the most valued companies in Silicon Valley. To date, Stripe has raised over $2 billion.
Stripe currently operates in 43 countries with 31 of them being in Europe. Paytech intends to invest the capital it raised in March in its European operations where it plans to create 1,000 new jobs at its Dublin headquarters.
Plans are also in top gear for fintech to launch in Thailand, India, Brazil, and Indonesia before the end of the year.
This year, Stripe also intends to pay more attention to increasing its portfolio of enterprise clients, a segment the company sees as the “largest and fastest growing segment”. Currently, fintech has 50 corporate customers processing over $1 billion in payments yearly. The company maintains that enterprise revenue from corporate clients such as Zapier and Twilio has more-than-doubled year-on-year.
