March 10, 2022

New FinTech Law in Non-Banking Financial Activities in Egypt

On 8 February 2022, Law No. 5 of 2022 Regulating the Development and Use of Financial Technology in the Non-Banking Financial Activities (the “FinTech Law” or the “Law”) was issued. The Law came into effect the next day as of 9 February 2022. The FinTech Law aims at paving the way for the expansion of the use of technology in the non-banking financial sector, and it comes in line with the Egyptian Government’s financial inclusion strategy.

Scope of Application

The FinTech Law applies to the use of FinTech in any of non-banking financial services that fall under supervision of the Financial Regulatory Authority (“FRA”). These services include:

  • capital markets,
  • insurance,
  • financial leasing,
  • factoring,
  • real estate financing,
  • SMEs financing, and
  • consumer finance.

The financial technology or the FinTech is defined to be the technology medium such as Apps, software, digital platforms or AI through which non-banking financial services are provided or facilitated.

Regulatory Authority

The law delegated FRA to be the regulator concerned with licensing FinTech companies working on the non-banking financing activities as well as overseeing their compliance with the Law. The FRA is mandated to issue the executive regulations of the Law within 6 months from the effective date of the Law.

Incorporation of FinTech Companies

The FRA has become the governmental authority competent to receive applications for the incorporation of FintTech companies and to approve it. Non-reply by FRA on the application within 30 days will be considered as refusal to incorporate the company.

Licensing Requirements

FinTech companies are required to obtain a license from FRA if they are operating in the non-banking financing activities. In order to obtain the license, the following conditions must be satisfied:

  1. Limiting the activities of the company to the licensed non-banking financing activities only.
  2. Disclosing the direct and indirect shareholder structure of the company as well as its related parties.
  3. Having the necessary technological infrastructure and equipment, information systems and security measures for carrying out the licensed activity.

Paying the license fee. The license fee will be determined by the board of FRA but in all caces it will not exceed EGP 50,000.

FinTech Startups

The Law mandated FRA to construct a regulatory sandbox within which license applicants can test their FinTech solutions in a live regulatory environment for a period of time where challenges and risks can be carefully monitored and contained before being integrated in the wider eco-system.

FRA will issue a temporary license for startups for no more than two years, in addition, startups will be exempted from paying the license fee. FRA will determine the requirements for issuing the license for startups and their minimum issued capital for no less than EGP 250,000.

FintTech Agreement with Customer

Contracts between FinTech companies and their customers are required to include:

  1. Detailed information of the parties
  2. The finance amount, the repayment duration, number of installments and its value.
  3. The interest rate and whether it is fixed or variable.
  4. Security granted to the financier.

Data Protection

A FinTech company and its related parties are required to strictly abide by the provisions of the Egyptian Personal Data Protection Law No.151 of 2020 by preserving the confidentiality of their customers’ personal data.


Operating or providing FinTech company in providing non-banking financial services without obtaining a license from FRA is penalized with a minimum period of 6 months imprisonment and/or a fine ranging from a minimum of EGP 200,000 to a maximum of EGP 1,000,000.

Providing misleading data or concealing information from FRA, or preventing FRA’s officials from executing their mandates is penalized with a maximum period of 1 month imprisonment and/or a fine ranging from a minimum of EGP 20,000 to a maximum of EGP 100,000.

Violating the confidentiality of the personal data of the customers is penalized with a minimum period of 3 months imprisonment and/or a fine ranging from a minimum of EGP 200,000 to a maximum of EGP 1,000,000. For more information about the FinTech Law, the licensing or compliance requirement, please contact Dr. Fatma Salah and Loai Mahmoud.

Court jurisdiction

Disputes arising from the FinTech Law fall under the exclusive jurisdiction of the Economic Courts. This is with the exclusion of disputes with governmental bodies which remains under the jurisdiction of the State Council courts.

For more information about the FinTech Law, please contact Dr. Fatma Salah and Loai Mahmoud


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