Moroccan fintech industry remains underdeveloped, despite thriving service industry

This year’s list of “mega-round” African startups has been revealed by the business media platform, Afridigest, and shows the startups that crossed $100 million in revenue this year. The list was dominated by FinTech (Financial Technology) startups, demonstrating the important progress this industry has made on the continent.

One of the most surprising results was the absence of a Moroccan startup from the 11 most grossing African startups.

Morocco has only been a startup hotbed for less than a decade, yet they exhibit promising signs of growth and development in a number of fields, such as climate change, agriculture, transportation, and digital appointment booking.

Moroccan startups, on the other hand, are lagging behind their African counterparts in terms of establishing themselves in the business world and catching investors’ attention, especially in the FinTech sector.

FinTech in Morocco: An emerging industry

FinTech startups are still relatively new to the Moroccan finance industry. Morocco’s Finance industry giants may be able to provide guidance to the country’s underdeveloped Fintech industry.

It is imperative that they take FinTech startups under their wings to guide, accompany, and model their success so that they can learn from them.

Morocco’s Deposit and Management Fund (CDG) took part in a webinar in May 2021 on FinTech startups, determining the potential of Moroccan startups and providing solutions for Moroccan entrepreneurs interested in competing with their African counterparts.

Experts and prominent figures from the finance industry participated in the Webinar. The participants in the meeting included Abdelhakim Agoumi, Director of the Customer Services and Alternative Channels Division of CIH Bank, and Abdeslam Alaoui Smaili, CEO of Hightech Payment Systems (HPS).

The experts discussed the reasons against the development of the FinTech industry in Morocco and provided recommendations to rectify those issues.

People in Morocco still rely on cash in their everyday transactions, which has become one of the major impediments to FinTech development.

Jean-Michel Huet, a former executive of Alipay in China, argues that Moroccans are not fully trusting online payments and Fintech-related services. Many Moroccans tend to be cautious when it comes to supplying credit card information to online services.

Morocco’s startups need to seize market opportunities and meet the needs of the users, explains Yassine Regragui. Startups cannot establish trust relationships with Moroccan customers or users without following this method.
Moroccan entrepreneurs also face a poor relationship with the “culture of failure” that stands in the way of FinTech startup development.

Innovation is not merely about coming up with an idea, but also putting such an idea into practice. As Abdeslam Alaoui Smaili pointed out, not only do you need an idea, you need to put it into action.

As noted by the HPS CEO, young Moroccan entrepreneurs are still not sufficiently mature in their entrepreneurial spirit, fearing failure greatly.

In his response, Abdelhakim Agoumi explained that CIH Bank is ready to welcome young Moroccan entrepreneurs and to guide them through the arduous process of starting a successful business. According to him, today’s real challenge is to have Moroccan entrepreneurs who are willing to take risks without fear of failure.

All participants agreed that the country should play a significant role in encouraging people to use FinTech startups’ services, suggesting that the government should step in and highlight the benefits of such services.

Currently, FinTech is one of the most promising industries on the planet. As a result of the revenue generated annually, the industry has caught the attention of investors willing to expand their investment portfolios. FinTech startups collaborate with established firms to provide the world’s consumers with modernized services that meet today’s fast-moving demands.

Therefore, Morocco’s startups and enterprises require a shared vision and a coordinated effort in order to compete with other FinTech-oriented nations.