The move is expected to broaden Saudi's capital markets, boost start up funding and create more jobs
Saudi Arabia on Tuesday approved its first two financial technology licences to Riyadh-based start-ups Manafa Capital and Scopeer to provide crowdfunding investment services on a trial basis
Securities regulator Capital Market Authority (CMA) provided the licences on Tuesday as part of a plan to develop a fintech sector in the kingdom following reforms to reduce its reliance on oil.
The companies will operate technology platforms which individual investors will then use to fund small and medium-sized enterprises, in exchange for shares in those firms.
The move is expected to broaden Saudi’s capital markets, boost start up funding and create more jobs.
The CMA will consider further applications for fintech licences later this year, it said.
The Saudi central bank in February signed a deal with US-based tech firm Ripple to help banks in the kingdom settle payments using blockchain software.
The Gulf country also saw Abu Dhabi-based private equity firm Gulf Capital buy a $267 million stake in Saudi-based electronic payment solutions provider Geidea in May.