In Jordan, fintech is emerging as one of the top investment targets for investors, attracting US$26 million in funding between 2018 and 2022 or 10% of all startup investments during the period, a new report by Magnitt, a data platform for investors, founders and corporates in the Middle East, and the Ministry of Digital Economy and Entrepreneurship of Jordan says.
The report, titled “The 2018-2022 Jordan Venture Capital Report”, covers a five-year analysis of Jordan’s startup funding landscape, highlighting the country’s growth and development in venture capital (VC) funding, and comparing the country against other nations in the Middle East and North Africa (MENA) region.
According to the report, Jordanian startups secured a total of US$246 million through 220 deals between 2018 and 2022, putting the country at the fourth position in MENA in VC funding and rounds behind only the region’s top three markets, namely the United Arab Emirates (UAE), Saudi Arabia and Egypt.
A breakdown by industry reveals that, unlike most MENA countries where fintech takes the lead, e-commerce and retail is actually the most prominent startup sector in the Jordanian landscape, making up 20% of all startup funding secured between 2018 and 2022 with US$50 million. This is followed by edtech with a 16% share (US$38 million), healthcare with a 15% share (US$37 million), and media and entertainment with a 12% share (US$29 million).
Top industries by total funding (US$) in Jordan, 2018-2022, Source: Jordan Venture Investment Report 2018-2022, Magnitt, the Ministry of Digital Economy and Entrepreneurship of Jordan, Nov 2023
Top industries by total funding (US$) in Jordan, 2018-2022, Source: Jordan Venture Investment Report 2018-2022, Magnitt, the Ministry of Digital Economy and Entrepreneurship of Jordan, Nov 2023
In terms of deal count, however, fintech takes the second position, neck-and-neck with healthcare with a share of 12% of all startup funding rounds in the country during the period, or 26 deals. The two sectors are behind e-commerce and retail with a 17% share and 38 deals, and ahead of enterprise software with a 9% share and 20 deals.
These trends imply that while fintech isn’t Jordan’s most-well funded startup category, the sector is seeing dynamism and recording a relative high number of deals. These smaller ticket sizes suggest a nascent fintech sector that is attracting investors’ interest.
A vibrant fintech sector
Over the past years, Jordan has witnessed growth and development in its fintech sector. Several startups have emerged to provide innovative solutions addressing specific market needs and challenges, and some of them have risen to regional prominence.
MadfoatCom, for example, is an online, real-time bill presentment and payment system that allows customers to inquire about and pay their bills and payments anytime, anywhere. Established in 2011 with partnership and support from Oasis500, the startup aims to provide seamless global electronic presentment and payment services for businesses and individuals by connecting banks with billers to facilitate payments.
MadfoatCom, which operates in Jordan, Egypt, Saudi Arabia, Oman, Palestine, the UAE, and Morocco, claims 3.6 million active users and over 1.4 million app downloads, as of March 2023. The startup was named one of the top 30 fintech companies in the Middle East for 2023.
Dinarak is another Jordan fintech startup that made it into the list, recognized by Forbes for the strong growth it has witnessed.
Founded in 2014, Dinarak is a mobile wallet, money transfer, electronic bill payment and funds disbursement service. The platform allows users to deposit, withdraw, transfer money and pay for goods and services via their mobile phone. The company claims it serves more than 400,000 customers and 3,000 businesses.
Liwwa, meanwhile, is a prominent alternative lending platform from Jordan. The company provides fast, affordable credit to small businesses, especially those in craft and retailing. Founded in 2015, Liwwa employs technology across its operations to improve efficiencies, increase access and provide tailored financial solutions. It’s said to have a portfolio of US$20 million.
Liwwa secured a US$18.5 million pre-Series B round in September 2022 to fuel its growth and expansion plans.
The growth of the Jordanian fintech sector has been promoted by an active investor community that’s been supporting promising young startups with funding, mentoring and networking opportunities. Prominent investors in the field include Oasis 500, a pre-seed and seed fund manager and accelerator that’s backed MadfoatCom, AmwalCom, DareebaTech and Solfeh; as well as Silicon Badia and Dash Ventures, two VC firms that’s backed startups such as Liwwa.
Jordan’s fintech sector is expected to keep up its momentum as the government and policymakers commit to fostering the growth of fintech. In August 2023, the central bank launched its Financial Technology and Innovation Vision, outlining hopes for fintech innovation to support the development of micro, small and medium-sized enterprises (MSMEs) and improve financial inclusion.
