The Saudi government has reaffirmed its commitment to transforming Riyadh into a powerful global fintech center. They are coming up with a new approach to threefold the strength of their fintech sector by 2025, an encouraging milestone for Islamic fintech. The country now has 82 enterprises in the industry, with the number likely to exceed 230 in the next three years. This will simultaneously raise the proportion of online payments in all monetary operations to 70%.
In 2018, Saudi Arabia's central bank, SAMA, established a legislative sandbox in which fintech companies can experiment and launch new goods and services. SAMA has now issued licenses to payment providers in the monarchy, including BNPL leaders Tabby and Tamara. It has also been positioned as a critical component of Saudi Arabia's 2030 strategy, which aims to enhance business and investments.
The objective will be accomplished by making it easier for fintech businesses to do operations and enhancing the private industry's role in the economy. The monarchy will draw more foreign funding to strengthen the digital infrastructure and encourage entrepreneurship and creativity to help SMEs thrive.
Finance Minister Mohammed Al Jadaan, who also serves as the head of the FSDP panel, believes that improving fintech services can help to stimulate other industries like retail, hotel, estate development, transit, and healthcare. He predicted that development in these areas, notably via AI technology, may push asset under management growth to 50% by 2030.
He also stated that on the worldwide competitive index for 2021, Saudi Arabia was placed 36th out of 63 nations. The nation has also created a Financial Sector Development Program (FSDP) led by Al Jadaan to broaden the country's economic forms of income and encourage investments and savings in the nation.
Moreover, a poll conducted by Fintech Saudi says 74 percent of people in Saudi Arabia have used at least one fintech service. According to the report, 69 percent of people employ digital payment daily, making it the most significant contributor to fintech acceptance.
Saudi Arabia's national fintech plan, being among the world's most influential Islamic financial powers, speaks well for the Islamic fintech industry domestically and worldwide. It is considered that even in the lack of specific directives, fintech newbies in the country are expected to match their business proposal with Shariah law. This makes Saudi Arabia a high-potential domicile for Muslim-friendly innovation financial services.