FRA sets minimum capital requirement for fintech startups in non-banking financing activities
Updated 1/9/2024 7:01:00 AM
Arab Finance: The Financial Regulatory Authority (FRA) has set a minimum capital of EGP 15 million for emerging fintech firms to practice non-banking financing activities, the FRA stated on January 8th.
This decision comes within the framework of the authority’s efforts to improve the business environment by facilitating, simplifying, accelerating, and reducing the cost of procedures for non-banking financial firms, especially the emerging ones.
The new decision applies to fintech startups seeking to obtain a license to practice one or more non-banking financing activities, such as mortgage finance, SMEs finance, microfinance, leasing, factoring, and consumer finance.
To obtain the license, the startup shall be an Egyptian joint stock company with an issued and paid-up capital of not be less than EGP 15 million for each activity.
The license will be valid for only two years until the company completes the final licensing requirements.
The decision also stipulated that the percentage owned by specialists in the field of technology shall not be less than 25% of the company’s capital.
It obligated fintech startups to start practicing the activity within two months from the date of the license issuance.
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