World News | CEPA Will Be Gamechanger for Fintech Cos and Startup Unicorns in UAE & India, Says MD of LuLu Financial

Dubai, Feb 21 (PTI) The Comprehensive Economic Partnership Agreement (CEPA) inked between India and the United Arab Emirates last week is a milestone and will be a gamechanger in bilateral trade, a leading remittance and forex company official has said, predicting a boost to fintech companies and startup unicorns in the region.

India and the UAE on Friday last signed the CEPA trade pact after concluding negotiations in a short time of 88 days. The pact aims to take the two-way commerce to the USD 100 billion mark in over five years and create about 10 lakh jobs in sectors such as apparel, plastic, leather and pharma.

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Adeeb Ahamed, managing director of Abu Dhabi-based LuLu Financial Holdings, said at a time when inclusive trade and economic cooperation are cornerstones of a robust economy, the CEPA signifies the commitment of the UAE and India to strive for greater growth through economic cooperation.

"The UAE and India have historically shared a close bond in several areas of trade and commerce, and CEPA will encourage the investor community, both regionally and globally, to also look into emerging sectors in both countries, notable of which is fintech," Ahamed told PTI.

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"The Indian fintech industry is estimated to touch USD150 billion by 2025, and the UAE is home to over 50 per cent of the fintech companies in the MENA (Middle East and North Africa) region. Combine the potential of these two markets, and the possibilities to generate employment, value and ecosystem growth are endless," he said.

According to Ahamed, the potential for interoperable solutions exists and the CEPA may well pave the way for companies in the UAE to seek investments and expand into India, and vice versa.

The volume of cross-border remittances between the two countries has often grabbed headlines, with 33 per cent of the outward remittances from the UAE going to India.

India and the UAE have been riding the startup unicorn wave in recent months, and Ahamed expressed optimism that the CEPA, which is expected to boost UAE-India trade to over USD 100 billion over the next five years, would open a doorway for both countries to export local technology in fintech solutions for the benefit of both economies.

“The UAE and India are home to several unicorns, especially in the fintech space. The timely signing of CEPA enables better market access and is bound to encourage faster technology exchange. This will ultimately inspire fintech companies to build meaningful payment solutions for people in both the countries,” said Ahamed.

With global investor sentiment leaning towards scalable fintech solutions, Ahamed also feels that CEPA will serve as a curtain raiser for closer collaboration and partnerships in the sector.

He cites the example of several recent developments, including the signing between National Payments Corporation of India (NPCI) and Network International, as well as investments by blue-chip investors from both countries, which are focused on bolstering the reliability and efficiency of the payments sector.

The segment has benefited greatly from the thrust on infrastructure development and robust processes, and the CEPA will fastrack much-needed investments into the financial services sector.”

LuLu Financial Holdings presently holds several investments in both the UAE and India – which includes a network of 83 branches of LuLu Exchange and the digital payments application LuLu Money in the UAE, apart from 29 branches of LuLu Forex and the newly started NBFC entity LuLu Finserv in India.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)