Saudi Press

Saudi Arabia and the world
Friday, Sep 05, 2025

Digital transformation of Saudi banking sector

Digital transformation of Saudi banking sector

Saudi Arabia’s Cabinet approved licensing for two digital banks in the Kingdom in June, with a total capital of SR4 billion ($1.06 billion).
First, STC Pay will be converted into a local digital bank, STC bank, with a capital of SR2.5 billion ($0.6 billion). Second, a number of companies and investors, led by Abdul Rahman bin Saad Al-Rashed and Sons Co., will establish a local digital bank — Saudi Digital Bank — to conduct banking business in the Kingdom, with a capital of SR1.5 billion.

Minister of Finance Mohammed Al-Jadaan, chairman of the Financial Sector Development Program (FSDP), said that “the Cabinet’s approval reflects the leadership’s keenness to keep pace with the rapid development in the fintech sector and to empower the Kingdom to be among the largest financial hubs in the world.”

For his part, Dr. Fahad Al-Mubarak, governor of the Saudi Central Bank (SAMA), pointed out that digital banks provide services and products exclusively through electronic channels by adopting an innovative and sustainable banking business model to enhance financial inclusion and keep pace with cutting-edge technological developments in the financial sector.

I believe that SAMA’s move toward digital banking is in line with the Kingdom’s Vision 2030 objectives to support growth in the banking sector.

By introducing full-fledged digital banks in the Kingdom, it is also in line with the central bank’s role of keeping pace with the latest technological developments in the banking and financial sectors.

It is worth noting that the Saudi banking sector has witnessed over the past two decades significant advancement and improvement in electronic banking services. This is evidenced by the establishment of Saudi Payments as a wholly owned subsidiary of SAMA, with the mandate to continue SAMA’s legacy of developing a secure, interoperable national payment infrastructure, to serve banks and fintech operators equally, and to offer the required standardization to ensure all providers have a level playing field.

SAMA and Saudi Payments’ efforts to enhance digital payments goes hand in hand with the FSDP, one of the Kingdom’s 13 Vision 2030 Realization Programs’ objectives to increase the share of non-cash transactions from 36 percent in 2019 to 70 percent in 2025 and to enhance financial inclusion in the Kingdom.

SAMA has granted 16 licenses to Saudi fintech companies recently to provide payment services, consumer microfinance, and digital insurance brokerage. Also, the central bank has licensed 32 fintech companies to work under the regulatory sandbox environment, which was designed to test innovative services and products in the Kingdom. This is in addition to the efforts to encourage local banks to provide the best possible services and products through available digital banking channels in accordance with international best practices.

After the first appearance of digital banks in 2015 with British bank Monzo, there are currently more than 400 digital banks worldwide. Challenger Insider reported that the total amount of investment into digital banks globally within the first quarter of 2021 has exceeded $3.7 billion through 42 deals.

Without a doubt, digital financial services in the Kingdom are progressing at a fast pace, as witnessed by the growth of electronic financial transactions in the banking sector, which have exceeded the target set by the FSDP. That non-cash transactions accounted for 36 percent of total transactions in 2019, while the target was set for 28 percent by 2020, is evidence of this.

I believe that granting licenses for two local digital banks to operate in Kingdom will add value to the banking sector and national economy, especially the digital economy. Also, it will enhance financial inclusion and support the central bank’s effort to broaden the scope of digital banking services in the Kingdom.
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Trump Administration Advances Plans to Rebrand Pentagon as Department of War Instead of the Fake Term Department of Defense
Tether Expands into Gold Sector with Profit-Driven Diversification
Trump’s New War – and the ‘Drug Tyrant’ Fearing Invasion: ‘1,200 Missiles Aimed at Us’
At the Parade in China: Laser Weapons, 'Eagle Strike,' and a Missile Capable of 'Striking Anywhere in the World'
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
Israeli Airstrike in Yemen Kills Houthi Prime Minister
After the Shock of Defeat, Iranians Yearn for Change
YouTube Altered Content by Artificial Intelligence – Without Permission
Iran Faces Escalating Water Crisis as Protests Spread
More Than Half a Million Evacuated as Typhoon Kajiki Heads for Vietnam
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Miles Worth Billions: How Airlines Generate Huge Profits
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
Beijing is moving into gold and other assets, diversifying away from the dollar
Cristiano Ronaldo Makes Surprise Stop at New Hong Kong Museum
Zelenskyy to Visit Washington after Trump–Putin Summit Yields No Agreement
High-Stakes Trump-Putin Summit on Ukraine Underway in Alaska
Iranian Protection Offers Chinese Vehicle Shipments a Cost Advantage over Japanese and Korean Makers
Saudi Arabia accelerates renewables to curb domestic oil use
Cristiano Ronaldo and Georgina Rodríguez announce engagement
Asia-Pacific dominates world’s busiest flight routes, with South Korea’s Jeju–Seoul corridor leading global rankings
Private Welsh island with 19th-century fort listed for sale at over £3 million
Sam Altman challenges Elon Musk with plans for Neuralink rival
Australia to Recognize the State of Palestine at UN Assembly
The Collapse of the Programmer Dream: AI Experts Now the Real High-Earners
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Nine people have been hospitalized and dozens of salmonella cases have been reported after an outbreak of infections linked to certain brands of pistachios and pistachio-containing products, according to the Public Health Agency of Canada
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
Tariffs, AI, and the Shifting U.S. Macro Landscape: Navigating a New Economic Regime
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
OpenAI’s Bold Bet: Teaching AI to Think, Not Just Chat
BP’s Largest Oil and Gas Find in 25 Years Uncovered Offshore Brazil
JPMorgan and Coinbase Unveil Partnership to Let Chase Cardholders Buy Crypto Directly
British Tourist Dies Following Hair Transplant in Turkey, Police Investigate
WhatsApp Users Targeted in New Scam Involving Account Takeovers
Trump Deploys Nuclear Submarines After Threats from Former Russian President Medvedev
Germany’s Economic Breakdown and the Return of Militarization: From Industrial Collapse to a New Offensive Strategy
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
×