TEHRAN – The financial technology (fintech) startups launched during the past two years have paved the way for reforming the country’s financial system, the head of management development department of the vice presidency for science and technology, said on Saturday.

The banking system did not support innovative business at first, however, now there is a good interaction between them, Alireza Daliri told IRIB.

There are 25 to 30 fintechs in Iran, which have contributed to fast financial services during the past two years, he explained.

Financial startups grow more than two times during previous year in Iran, which is multiplied in comparison to non-financial ones, he said.

“We do our best to improve startups in financial field and provide blockchain for financial services in different parts of the country,” he explained.

He expressed his hope that startups transform the traditional banking system in Iran in near future.    

In May 2018, Information and Communication Technology (ICT) Minister Mohammad Javad Azari Jahromi announced that as per an approval by the cabinet of ministers, the central bank is obliged to end PSP (Payment Service Provider) monopoly and create a competitive space for fintech market.

Up to now, the internet finance in Iran was PSP-based, which offers shops online services for accepting electronic payments by a variety of payment methods including credit card and bank-based payments.

Fintech is a portmanteau of financial technology that describes an emerging financial services sector in the 21st century. 

Originally, the term applies to technology applied to the back-end of established consumer and trade financial institutions. Since the end of the first decade of the 21st century, the term has expanded to include any technological innovation in the financial sector, including innovations in financial literacy and education, retail banking, investment and even crypto-currencies like bitcoin.

SB/MQ/MG