Technology has the ability to change the world. Innovation in the sector can impact all aspects of our daily lives, both in public and private. As technology has become more widely accessible and new ways of using it are constantly appearing, the impact of it has been felt across the world but especially in regions playing catch-up. So what has the impact of technology been in the Middle East?
The Middle East is a bubbling hub of innovation and entrepreneurship. The areas where technology has had the biggest impact on society has been specifically in the field of business. Small businesses have taken up technology and transformed society. The impact of small business technology in the Middle East has not only helped to bridge the gap between the region’s rich and the poor but also nurture talent and further innovation.
Reducing Social Inequality
The Middle East suffers from a lot of inequality. According to the statistics, the region has the biggest economic inequality gap. In practice, it means that the top 10% of the population in the region enjoy nearly 66% of the region’s income. What’s more shocking is how nearly 90% of the region’s adult population don’t have access to financial institutions.
The good news is that small business technology is changing this. There have been lots of innovation in the field of finance in the Middle East and local businesses have started to focus on closing this inequality gap. Financial tools have been developed to provide things like mobile banking to the region’s low-income workers, for example. This type of small business innovation is lifting people out of poverty and financial dependency.
A major impact of small business technology has also been further innovation. As the local governments understood the need to focus on issues like inequality, they all started to support initiatives that would boost local business. Many countries in the region started investing in small and medium enterprises and as successful companies started to pop-up, more innovation and excitement around entrepreneurship came about. In a short period, the region’s fintech companies actually doubled in size!
It’s not just the local governments doing it either, but investors are also nurturing the new startups in the region. In 2016, the region’s fintech investment stood at US$18 million but in 2017, the figure went above it largely thanks to a single investment of US$20 million. With small business technology attracting investment and attention, the countries in the region can diversify and change their economies for the better.
The technology boom is also changing the demographics of the business world in the Middle East. The surprising thing about the small business world in the region is that it has quite a high female representation. In fact, over 25% of startups in the region are founded or led by women whilst in the US, the figure is closer to 17%. Of course, more women still need to be involved but it’s a promising start in a region not always known for its equality of the sexes.
Women in the Middle East are launching tech businesses because of the ease of it. Small business technology allows for wider access to talent and resources. You don’t need to have a physical office space or have the whole team working at the same location for example – you simply need a device with access to the right business tools and a talented team to work towards goals. Having more women in the workforce will, again, help diversify the economy and boost growth in the region.
Becoming a Global Hub
Interestingly, small business technology isn’t just changing the Middle East in terms of its local economy and social cohesion. The region is also launching itself as the global hub of entrepreneurship and innovation. As the investment flows show, there is a lot of appetite for Middle Eastern businesses and ideas.
Furthermore, because the region is becoming such a hotbed of innovation, a lot of global talent is moving to the region to seek opportunities. Many of the local startups are actually either set by immigrants to these countries or at least have a big portion of the workforce coming from outside of the region.
It’s no surprise then that a big area of small business technology innovation has been in the Human Resources sector. One HR software company in Dubai is showing how the region can become a leader in the field with international companies now turning to the region for expertise. Whilst in the past, most technology development took place in the United States, the example of the Middle East shows that there is talent and desire to be a leading voice in the field outside of the US.
The impact of small business technology in the Middle East has been immense and profound. Technology and entrepreneurship are transforming the region in economic and social ways, turning it a leading hub of innovation.