Who'll drive the UAE's sharing economy?

The 42nd ICA Conference described Dubai as a place where many young entrepreneurs come to set up their businesses because they know that they can get the very best of opportunities.

While the UAE's sharing economy slowly continues to grow, as consumers see more of a merit in borrowing both goods and services rather than owning them, traditional businesses now find themselves in a unique position of having to find a way of countering the disruption being caused in various industries.
Speaking on a panel discussion on the rise of the sharing economy at the 42nd ICA Conference, David Passiak, futurist, innovator and author, described Dubai as an interesting example of an economy, where many young entrepreneurs come to set up their businesses because they know that they can get the very best of opportunities in the region. It is these entrepreneurs that will ultimately set the pace for the growth of the sharing economy in the region in the coming years.
Jennifer Hansen, global head of sales strategy and execution at Saxo Markets, explained that it used to be a very viable business proposition in the financial services industry to own the whole customer journey.
"The focus was on doing it all in-house, but what we have seen is that this whole business model now has less value, and is less viable. Banks are realising that there are hundreds of companies that do each of these elements in the equation extremely well. The real seismic shift in the banking sector is how you can today take advantage of that - which part of the journey are better owned by yourself, and which are better left to service providers."
"It is not about creating a mobile app," she stressed. "It is about a whole cultural transformation about how you serve your customers." Hansen also noted that a lot of progress had been made in recent years towards this end.
Speaking about new technologies that will increasingly have an impact on the sharing economy, author and speaker Chelsea Rustrum noted that blockchain is a natural extension of the principles of the sharing economy. "There is a change in how banks are operating across the world, especially when it comes to cryptocurrencies and blockchain. The implications of these technologies have to be factored in to the new equation."
Passiak added that cryptocurrencies such as Bitcoin are not very efficient when it comes to very simple transactions because there are high cost fees involved in the transactions, as well as a lot of processing time. "One one hand there is a resistance from banks to not get into the cryptocurrency space, but it has proven to be extremely lucrative, and there are lots of opportunities that have stemmed from such technology."
In addition, the UAE Financial Markets Association, who were the organisers of the conference, also challenged the region's investment bankers, traders, treasury managers and finance professionals to brace for change amid the rise of populism in the West and the sharing economy grows.
- rohma@khaleejtimes.com