Saudi Banking Sector Embraces Digitalisation
Saudi Banking Sector Embraces Digitalisation

Saudi Banking Sector Embraces Digitalisation

5 may, 20222 minutes to read
Follow [Durov's // Code] on Telegram

According to the statistics published by Saudi central bank, the number of bank branches declined by 6 percent between 2017 and 2021. This is equal to the closure of 124 offices. ATMs saw a ten percent drop over the same period.

The digitalization trend in Saudi banking and payment industry started growing in 2018 only to accelerate in 2022. During the first quarter of the year a total of 13 bank branches and 81 ATMs were closed.

The COVID-19 pandemic, together with the Financial Sector Development Program, launched by the Saudi government in 2018, affected the banking and payment processing industries and led to a wave of digitization that aims to increase cashless transactions.

2022 saw a rapid increase in the number of online purchases. The value of sales using mobile phones grew 13.6 percent during the first quarter of the year compared to the final three months of 2021. Point of Sale transactions increased 15 percent in terms of sales value over the same period.

To accelerate the transformation, this year SAMA is planning to launch the second phase of the instant payment system Sarie.

Saudi fintech industry experienced rapid growth at the end of the previous decade. Saudi central bank SAMA sought to diversify the financial sector by launching “Fintech Saudi”  initiative in April 2018, which aimed at transforming the kingdom into a new financial hub.

According to a Fintech Saudi report, fintech transaction values between 2017 and 2019 increased by over 18 percent year-on-year, reaching over $20 billion in 2019. The report stated that the transaction value will surpass $33 billion by 2023.

The number of active fintechs continues to grow, as 2021 has seen a 37% increase in the number of active fintechs from last year.

Saudi Arabia also witnessed a massive jump in venture capital investments in the fintech sector, hitting 16 deals in the first eight months of 2021, totaling $157.2 million. In 2021, it witnessed a 37-percent rise in new fintech launches over the previous year.

5 may, 2022
Follow [Durov's // Code] on Telegram