Bahrain outpaces GCC with 48% Fintech cost advantage

TDT| Manama

Email : editor@newsofbahrain.com

Bahrain has emerged as the Gulf’s most cost-effective base for financial services firms operating tech hubs, with a commanding 48 percent cost advantage over its regional peers, according to a new Ernst & Young LLP report.

Published by EY’s US office, the ‘Cost of Doing Business in the GCC’ study benchmarked Bahrain against five other GCC states across key expense categories such as business setup, labour, office space, and regulatory fees. The report found Bahrain led in every major category, offering companies a chance to reduce operational costs while accelerating innovation.

Office Space, Talent, Licensing

According to the report, businesses in Bahrain enjoy 60 percent better value for office rentals, while labour costs for tech professionals - such as data analysts and developers - are 24 percent more competitive than the GCC average. Licensing and business setup fees were also found to be 85 percent lower than in peer states.

Ali Al Mudaifa, Chief of Business Development at the Bahrain Economic Development Board, said the Kingdom is positioning itself as a “regional leader” by providing “a supportive environment that combines cost-efficiency, cutting-edge infrastructure, and a forward-looking regulatory framework.”

“Our goal is to empower global financial institutions to leverage Bahrain’s unique advantages and highly skilled talent to drive technological advancement across the region,” he said.

Momentum for Innovation

Bahrain’s regulatory structure - overseen by the Central Bank of Bahrain - simplifies financial operations under a single licensing system. This approach allows fintech firms to operate with flexibility and reduced administrative burden.

Andrew Phillips, Partner at EY and co-leader of its QUEST unit, said Bahrain’s cost profile offers a powerful incentive. “Tech hubs are the heartbeat of modern financial services... Bahrain’s cost advantages allow firms to direct financial resources toward innovation rather than basic operating expenses,” he said.

The report noted that tech hubs typically employ large numbers of data analysts and software developers, whose salaries represent a major cost driver in the industry - a factor that tilts decisions in Bahrain’s favour.

Global Firms Bet on Bahrain

Bahrain’s global competitiveness has already drawn major players. Citi’s Global Tech Hub has pledged to hire 1,000 Bahraini coders, while J.P. Morgan’s Global Technology Centre is expected to create 200 high-quality tech jobs in the country.

According to the IMD World Competitiveness Ranking, Bahrain ranks 4th globally for skilled labour and 6th for digital and technological skills - reinforcing its growing reputation as a digital finance hub.

With its strategic location, future-focused regulation, and measurable cost advantages, Bahrain appears to be pulling ahead in the GCC’s fintech race.

More firms are likely to follow as operational costs weigh heavier in expansion decisions.