CAIRO: The financial technology industry has been one of the most promising sectors globally, and Saudi Arabia’s Vision 2030 blueprint is fueling fintech development in the country.
The Saudi government has been pushing initiatives toward the sector like never before. It set up Fintech Saudi, an initiative of the central bank to boost financial technology in all subsectors.
In June 2022, the Saudi Cabinet approved the Kingdom’s financial technology development strategy focused on nurturing fintech players from 90 in 2022 to 525 by 2030. But given the sector’s enormous potential, do the numbers add up?
Some successful startup executives believe there is considerable scope for development in the fintech sector, and more players yield better services and growth.
“If you look at Saudi Arabia today, there are a lot of financial services that require advancement and improvement in consumer experience,” Abdulaziz Saja, general manager of Tabby Saudi Arabia, a leading buy now, pay later platform, told Arab News.
Saja said that increased fintech players would benefit the Kingdom if each company focuses on a specific service and creates value through specialization.
The Kingdom is one of the largest economies in the Middle East and North Africa. However, compared to neighboring countries, the current number of fintech players would seem too low.
For example, last year, the UAE and the UK had 136 and 2,047 fintech companies, respectively, compared with 82 in the Kingdom, according to industry figures.
Indeed, with more fintech players, the sector will become more competitive. A founder of an 11-month-old Saudi fintech startup would see that as harmful for business, but Ali Alhazmi, CEO and founder of OXO E-Shops, believes otherwise.
Alhazmi told Arab News that adding fintech players in the sector will drive competition, but it is necessary to boost growth.
“Competition is a good thing for the market,” Alhazmi said, “adding new players will be healthy as it makes existing companies fight harder for their market share and deliver the right values for their customers, which will boost the economy.” The country has seen many entrepreneurs entering the market recently as the central bank granted two licenses in August, bringing the total number of licensed fintech companies to 19.
Moreover, Djamel Mohand, chief operating officer of Foodics, a prominent fintech player in the Kingdom, stated that the growing number of licenses issued by the central bank indicates growth.
“The fintech sector in Saudi Arabia is thriving at a light-speed pace. The two main factors are the booming number of
entrepreneurs wanting to disrupt the space and the exceptional support of the Saudi government from a regulatory, facilitation and access to capital perspective,” he told Arab News.