2021 proved to be another year of tremendous growth in the Saudi Arabian fintech VC/PE and M&A activities. The Kingdom, through its ministries, regulators and support organizations continued to build an atmosphere conducive to Fintech innovation. The following are recent developments:

  • In February 2022, Saudi Arabia has launched the exchange of open banking, coming a year after the Saudi Central Bank (SAMA) unveiled its open banking policy, which was aimed to achieve Vision 2030 goals of enhancing competition, efficiency, and confidence in the financial services industry. Saudi Arabia will speed the adoption of open banking in the nation by drawing on the past achievements and know-how of Open Banking Europe and the OBE communities in Southeast Asia and Latin America.[1]
  • In February 2022, the government approved a license for a local digital bank to be established with a capital of SAR1.65 billion ($440 million). The D360 Bank will be established through a consortium of individual and corporate investors, led by Derayah Financial Company, with the Public Investment Fund as one of the main investors. With this license, the total number of regulated banks in the Kingdom comes to 35, comprising 11 local banks, three local digital banks, and 21 international bank branches.[2]
  • In January 2022, Saudi Arabia-based fintech Urway, obtained the Electronic Merchant Service Provider certificate by Saudi Payments, becoming the kingdom's first certified fintech following the publication of new payment regulations and rules. Through their online payment technology that links them to the most popular payment schemes, the platform enables online merchants to monetize their services and provide e-commerce websites with safe, dependable, and seamless payment solutions.[3]
  • Wa'ed, Saudi Aramco's entrepreneurship branch, has been working with Fintech Saudi and local seed and early-stage VC firm Flat6Labs, to launch a 12-week Fintech Accelerator program. The Fintech Accelerator program will feature a regulatory track and a business track, as well as a day for start-ups to pitch potential investors. The program, which is set to start at the end of February with 12 Fintech businesses that have been approved/qualified.[4]
  • Saudi Arabia's financial markets regulator is implementing additional measures to strengthen the country's fintech regulatory environment. The Capital Market Authority (CMA) has announced the approval of amendments to Fintech Experimental Permit Instructions. The amendments include adding definitions to clarify the nature of the Fintech Lab and adding instructions for business practice in the Fintech Lab. The amendments also include updating the application form for the Fintech ExPermit.[5]

Download Pulse of Fintech H2’21

VC investment soars and M&A makes a big comeback.

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  • global and regional analysis with key investment data and insights
  • top fintech trends for 2022 and beyond
  • interviews with Quantexa and Thought Machine
  • fintech segment insights for a deeper dive into payments, insurtech, regtech, wealthtech, cybersecurity, blockchain and cryptocurrency
  • spotlight articles on emerging markets: LATAM and Africa.

To learn more about the analysis and topics raised in this edition, or to discuss your organization's unique fintech agenda and roadmap, please contact your local KPMG advisors or the contributors in this publication.