In alignment with its goal of enhancing the kingdom’s financial stability and economic development, Saudi central bank (SAMA) has granted licenses to three new fintech companies, including electronic payments processor Mobily Pay.
Mobily Pay is now eligible to provide e-wallet payment services in Saudi Arabia bringing the total number of payment companies licensed by SAMA to 17, in addition to eight companies granted an In-principle Approval.
SAMA also kick-started the licensing of debt-based crowdfunding by granting Lendo, a closed joint-stock company with a capital of SAR5million riyals, the license to conduct these kinds of financial activities within the kingdom after a success trial ran through SAMA’s regulatory sandbox. Sandbox is a regulatory body which allows fintech companies to experiment with innovative financial products.
The Saudi central bank also issued a license to consumer microfinance provider FinZey, a closed joint-stock company with a capital of SAR20m.
These initiatives come as part of SAMA’s role in strengthening the sectors of finance and payments-processing services by allowing them to engage in new activities and to entice a wider pool of investors and companies, while ensuring efficient operation by adhering to the central bank’s control and supervisory requirements when it comes to corporate governance and risk management, as well as displaying commitment to consumers and seeking to guarantee their protection.
SAMA reaffirmed its commitment to support the finance and payments sectors and to increase the effectiveness and flexibility of financial transactions thereby enabling and encouraging innovations in financial services and enhancing the level of financial inclusion in the kingdom.
The Saudi central bank also stressed the importance of exclusively dealing with licensed and authorised financial institutions, something that all interested parties may verify by visiting SAMA’s official website.
SAMA made the licensing announcements during the Global Entrepreneurship Congress conference, sponsored by Mohammad bin Salman, the Crown Prince, Deputy Prime Minister and Minister of Defence, and held from 27-30 March in Riyadh, under the theme Reboot, Rethink and Regenerate.
It was organised by the Small and Medium Enterprises General Authority (Monsha’at) in cooperation with the Global Entrepreneurship Network (GEN).
Riyadh ranked third in the Middle East, following Tel Aviv and Dubai, in terms of its attractiveness as a fintech hub, as per Global FinTech Rankings Report 2021 from Findexable and Mambu released last July.
Islamic fintech is on the rise globally, especially in Saudi Arabia and the UAE, with the total volume of transactions within OIC countries at $49bn. While that constitutes only 0.7 percent of global fintech transactions, Islamic fintechs are projected to grow to $128bn by 2025 at a 21 percent compound annual growth rate, according to the Global Islamic Fintech Report (GIFR) 2021.
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