time to read 1 minutes

Weren’t banks in the GCC meant to be consolidating?MENA

Weren’t banks in the GCC meant to be consolidating?

Last week we were telling you about Agility Logistics selling its freight forwarding operation services to DSV Panalpina for a grand total of $4.8b. Have you been wondering where all of that money will go? Well, you don’t have to wonder anymore. Agility has just applied for a license to establish Kuwait’s first digital bank. After the news broke, Agility’s (AGLTY) shares surged 14.59% on the Dubai Financial Market. Agility’s decision to open up a digital bank is also backed by a 503.7% surge in net profit in the second quarter of 2021.

The company’s move is in line with changing consumer behavior in the GCC region. According to a recent BCG survey, 87% of UAE residents are willing to open up a new account with a branchless, online bank. Couple this with the rise of a tech-savvy generation, and Agility’s decision becomes quite understandable.

why it matters

Talking about Gen Z, ADIB has just launched the world’s first Islamic digital bank targeting this segment of the population. A wave of new independent digital banks in the GCC could arise if traditional banks are not quick enough in digitizing.