The Kingdom of Saudi Arabia is planning to increase the number of companies operating in the financial technology industry to more than 525 by 2030. This increase will require investment in the capabilities of young people and the promotion of entrepreneurship in the financial sector.
Mohammed ElKuwaiz, Chairman of the Capital Market Authority, made the announcement during a speech. He pointed out that the sector witnessed a growth rate of 105% in the workforce compared to the previous year, with Saudization in the industry reaching 74%.
ElKuwaiz also emphasized that financial technology is a “key nerve” for improving the efficiency of financial services and products and developing them in the country.
The Saudi Cabinet approved the Financial Technology Strategy at the end of May, which aims to make Saudi Arabia among the leading countries in the field and a global hub for the technology sector. The strategy comes as a new focus within the Financial Sector Development Program, which is one of the programs of Saudi Vision 2030. It aims to develop the national economy, diversify sources of income, empower financial institutions to support private sector growth, and open the field for new companies to provide financial services.
The statements of the Chairman of the Capital Market Authority come at a time when the fintech sector continues to thrive in the Kingdom of Saudi Arabia. The fintech ecosystem in the Kingdom witnessed a 79% annual increase in the number of active fintech companies to 147 active companies in 2022, according to a report by the American-Saudi Business Council.
Last year, the country recorded more than 147 active fintech companies, an increase of 1470% compared to 2018, which saw only 10 companies registered. The report’s data shows that this number surpasses the figures recorded by the United Arab Emirates and Egypt, which were the two countries that led the Middle East and North Africa in the number of fintech companies in 2015.
On the other hand, the booming financial technology sector in Saudi Arabia received a boost from the $80 million investment fund launched in March by the government investment company, Saudi Venture Capital Company (SVC).
On June 15, the Saudi Press Agency reported that SVC invested $30 million in the fund, called “Badir 2,” which supports early-stage startups and focuses on several sectors, including financial technology and Web 3.
Financing in the Saudi financial technology industry seems to be a regional trend, in conjunction with the sector’s dominance, along with e-commerce, in funding venture capital in the wider Middle East and North Africa region during the first half of 2023. According to the latest report by the data platform “Magnitt,” these industries represented about 80% of total funding in the region during the first six months of the year.
Saudi Arabia Emerges as a Leading Fintech Hub in the Middle East
A recent report has revealed that Saudi Arabia is one of the fastest-growing financial technology centers in the world. The report, entitled “Ready to Launch,” was issued by “Fintech Global Index” and “Findexable.”
The report found that Saudi Arabia has made significant progress in developing the infrastructure and regulations needed to support the growth of the fintech sector. The country has also seen a surge in investment in fintech companies, with more than a billion dollars invested since 2018.
As a result of these factors, Saudi Arabia is now ranked 65th in the world for fintech development. The report also found that Riyadh has become the second most attractive city in the region for fintech companies.
The growth of the fintech sector in Saudi Arabia is being driven by a number of factors, including the increasing use of e-commerce, the growing demand for mobile payments, and the government’s support for innovation.
The report’s findings suggest that Saudi Arabia is well-positioned to become a leading fintech hub in the Middle East.
The country has the potential to attract even more investment and develop world-class fintech solutions.
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