Management consultancy Arthur D. Little has forecasted a flourishing future for the financial development sector in Saudi Arabia, noting the country is on the correct path to become a leading hub in this arena thanks to strategic measures to fuel innovation.
The firm’s report highlighted a significant increase in the number of fintech companies in the Kingdom, from 89 in 2022 to around 200 in 2023, while the sector has attracted investments exceeding 4 billion riyals in the last five years.
The report attributed this progress to pivotal initiatives such as the Saudi Fintech and the experimental legislative environment for financial technology (Sandbox) introduced by the Saudi Central Bank. Additionally, substantial support and funding from entities like the Saudi Venture Capital Company, backed by the Capital Market Authority and the Financial Sector Development Program, has been vital. This program launched a fund worth 300 million rials focusing on startups in the sector, as reported by the Arab News Agency.
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Furthermore, the report noted that growth was also supported by enhancing financial partnerships to encourage cross-border collaboration and assist Saudi fintech companies in their international ventures, which will play an effective role in achieving long-term success.
Arjun Sethi, co-head of the Global Fintech Practice at Arthur D. Little, expressed, It is evident that the Kingdom is committed to fostering a vibrant and comprehensive fintech ecosystem through comprehensive regulatory improvements and the strategic capital infusion into the sector.
The report also mentioned that over 100,000 individuals participated in fintech-related events, training courses, and internships organized by the Saudi Fintech Initiative. These developments reflect a shift towards more accessible financial services, aligning with the digital-savvy user’s needs and preferences, in line with Vision 2030’s objectives to create a diverse and sustainable economy.
Arthur D. Little pointed out that the fintech trajectory in the Kingdom includes strategic enhancements in areas such as bolstering Saudi Arabia’s global standing, strengthening international partnerships, streamlining regulatory frameworks, expanding financing avenues, nurturing talent, and investing in infrastructure.
By maintaining momentum in these sectors, the Kingdom will enhance its fintech ecosystem and support investors and innovators both locally and globally. The firm anticipates that the fintech sector in Saudi Arabia will play a fundamental role in achieving the goals of Vision 2030, with continual commitment to innovation and the adoption of flexible strategies being key factors in maintaining the Kingdom’s leadership in the fintech arena.
