RIYADH, 6 April 2005 — A senior business consultant said here that Saudi banks are lagging behind their counterpart banks in the region in terms of high technology currently being used in consumer finance and credit card sector. In fact, the credit card technology is undergoing rapid changes, which has led to the production and circulation of credit cards with added features.

Moses Kuria, managing consultant at WAMAD Consulting, said that the banks should look afresh on the consumer finance and credit card trends. Kuria was speaking at a conference organized by WAMAD here. WAMAD is one of the leading consulting companies for the banking sector in the Kingdom. During the conference, the impact on Saudi banks of the introduction of Smart Card technology as a mandatory standard in banking was analyzed and discussed at length. In his key presentation focusing on Smart card technology, Kuria said that “Saudi banks were still lagging behind other banks in the region and internationally”.

The new Smart card standards also known as EMV (European Master & VISA) compliance will shift the liability of fraud from the acquiring banks to the issuing banks by 2006. Given the enormity of EMV on the banks’ cards, Points-of-Sale (POS) and ATM machines, Kuria argued that Saudi banks ought to do more to catch up with other countries.

“There is also the need for the Saudi Arabian Monetary Agency (SAMA) to speed up the issuing of the relevant guidelines on EMV in the Kingdom”, said the consultant. “At the end of the day, most aspects of banks’ business model will be affected by EMV”, said Kuria, while referring to the growth of banking industry in the Kingdom and in the Middle East region as a whole.

Banks were also advised to take advantage of their Smart card investments through launching innovative Smart Card products. Daniel Dib, regional manager of the French Loyalty Card Group, Welcome International presented a paper on how Saudi banks could use loyalty programs to realize returns on their EMV investment.

At the end of the conference, various leading merchants, travel agents and airlines who were in attendance agreed to launch their own shared loyalty program in conjunction with a local bank.