Fintech
Dyna.Ai focuses on Saudi Arabia’s fintech sector
RIYADH: As Saudi Arabia advances its Vision 2030 goals, the Kingdom’s central bank is at the forefront, spearheading a number of crucial initiatives and greenlighting various ventures in 2024. These actions reaffirm the nation’s commitment in promoting innovation and financial inclusiveness.
The Saudi Central Bank, known as SAMA, has ushered in a wave of programs and approvals this year, ranging from the introduction of safe account services to engaging in high-level discussions on reserve management and expanding efforts investment training.
Furthermore, it has issued licenses to strengthen payment and crowdfunding services, strengthening its key role in the Kingdom’s economic diversification.
Here are some of the significant developments and initiatives undertaken by SAMA this year:
Improve safety and accessibility
In May, SAMA announced the launch of a new initiative called “View My Bank Accounts” for individual bank account holders. The new service aims to improve reliability and reduce the risks of suspicious transactions, unauthorized account use and identity theft.
SAMA added that it is constantly working on the development of electronic financial transactions in accordance with international best practices.
Address macrofinancial challenges
In April, the apex bank convened a high-level meeting on reserve management, addressing the complexities of the current macro-financial environment. The event brought together reserve managers and central bank experts from the Middle East and North Africa region, along with participants from other top financial institutions, to delve into the latest trends in foreign exchange reserve management.
SAMA Governor Ayman Al-Sayari highlighted how the evolving global landscape introduces new challenges and opportunities for central bank reserve managers. He underlined the importance of such high-level meetings to address the complexities of the current macro-financial environment.
Investment Immersion Program
In another context, the Saudi Central Bank in April started the registration process for its fourth edition of the Investment Immersion Program, aimed at cultivating and employing local investment professionals.
Developed in collaboration with the Wharton School at the University of Pennsylvania, along with leading global banks and asset managers, this program offers a comprehensive curriculum with academic courses and hands-on training in various investment fields.
“The program offers an advanced technical course, on-the-job training at international banks and asset management companies, and job rotation in the position of investment delegate at the Saudi Central Bank under the supervision of experts in asset management and financial markets global,” SAMA said.
Additionally, participants will benefit from ongoing development programs aimed at enhancing their technical investment capabilities, as well as a number of distinctive employment benefits.
The program is aimed at Saudi citizens under the age of 27 who hold a bachelor’s or master’s degree in finance, accounting, economics, statistics or business-related fields from accredited national or international universities.
Driving financial stability
In February, the central bank, represented by SAMA Governor Al-Sayari, co-chaired the Financial Stability Board’s regional advisory group for the MENA region meeting in Riyadh.
Also present were Hassan Abdulla, governor of the Central Bank of Egypt, and Klaas Knot, president of the Financial Stability Board.
Discussions during the meeting focused on challenges related to global and regional financial stability vulnerabilities, including the implementation of the global regulatory framework for crypto-asset activities.
Furthermore, the meeting explored lessons learned from the turbulence affecting the global banking sector in 2023, along with financial risks arising from the high interest rate environment and non-bank financial intermediation.
Al-Sayari highlighted the emergence of the MENA region as a global development hub, driven by its strategic location and continued economic diversification efforts. He also highlighted the International Monetary Fund’s assertion in its Regional Economic Outlook that the MENA region is resilient to adverse macrofinancial risk scenarios.
Al-Sayari stressed the importance of developing plans that support financial stability by aligning with the economic and financial conditions of the region, promoting the interrelationship between its economies.
Members also received an update on the FSB’s work program for 2024 and discussed the FSB’s report on the first lessons learned from the banking turmoil in 2023.
The FSB Regional Advisory Group for the MENA region includes financial and regulatory authorities from Saudi Arabia, Kuwait and the United Arab Emirates, along with Bahrain, Oman and Qatar. Furthermore, it includes Egypt, Algeria and Jordan, as well as Lebanon, Morocco, Tunisia and Türkiye.
Promote financial innovation
Over the course of the year, the central bank was proactive in licensing various payment and crowdfunding service providers.
It began the year by authorizing Thara to offer debt-based crowdfunding solutions. At the same time, SAMA also granted licenses to Network International Arabia for point-of-sale payment services and to Barraq for e-wallet services.
HIGHLIGHTS
• The Saudi Central Bank, known as SAMA, has ushered in a wave of programs and approvals this year, ranging from the introduction of safe account services to engaging in high-level discussions on reserve management and the expansion of investment education efforts.
• SAMA Governor Ayman Al-Sayari stressed the importance of developing plans that support financial stability by aligning with the economic and financial conditions of the region, promoting the interrelationship between its economies.
“This decision reflects SAMA’s commitment to supporting the financial sector, increasing the efficiency of financial transactions and promoting innovative financial solutions for financial inclusion in Saudi Arabia. SAMA emphasizes the importance of dealing only with authorized financial institutions,” the apex financial institution said.
In February, the central bank extended permission for Alpha Arabia Finance Co. to engage in financing activities for small and medium-sized enterprises.
In April, SAMA licensed Funding Souq to provide debt-based crowdfunding solutions, bringing the total number of such companies operating in the Kingdom to 10.
Sohar International receives approval from SAMA
In January Sohar International, Oman’s second largest bank, received a no-objection certificate from SAMA as it planned to expand into Saudi Arabia.
This strategic move is in line with the bank’s growth strategy, demonstrating its ability to identify sustainable expansion opportunities.
The bank’s entry into the Saudi market is expected to help Omani companies seeking to enter the Kingdom’s market.
“At the heart of the bank’s strategic expansion is a synthesis of personalized, customer-focused offerings and cutting-edge services. These form the core of the bank’s overall strategy, which aims not only for growth but also for continuously improving customer experience in an ever-changing financial landscape,” said Ahmed Al-Musalmi, CEO of Sohar International.
Overall, SAMA’s proactive measures underline its commitment to supporting Saudi Arabia’s economic growth and resilience in an ever-changing global financial landscape.