Egyptian fintech in 2020: A tale of crosswinds and tailwinds [Part One]

Egyptian fintech in 2020: A tale of crosswinds and tailwinds [Part One]

In this two part series, Michel Assaad, vice president of Europe, Middle East and Africa strategy at Citi Bank, outlines the trends that have emerged in Egypt's financial technology (fintech) space over the past year. The views expressed below belong solely to him and not his employer.   

It is hard to find an original way to describe 2020. I think we can all agree that it was truly a unique year that has had, and will continue to have, immense and uneven consequences on most aspects of our lives.

Among the sectors that thrived last year, many would count fintech as one of them, after all, Covid-19 has helped leapfrog digital adoption, particularly in payments and e-commerce.  

The story is, however, more nuanced and convoluted. It is true that several sub-sectors of fintech flourished and that startups with strong, adaptable business models thrived. The crisis, however, has also severely impacted people's ability to spend, borrow and repay loans in a way that threatened a large number of companies with shorter cashflow runways. Fintechs that cater to heavily impacted industries (e.g., travel) struggled. Many fintechs that service small to medium-sized enterprises also struggled.

The true and multi-layered, impact of the crisis can only be