The Saudi Open Banking Programme includes a reportedly comprehensive set of legislation, regulatory guidelines, and technical standards based on international best practices to enable banks and fintechs to provide Open Banking services in the Kingdom. The first version of Open Banking services focused on the Account Information Service (AIS), and the second version will focus on the Payment Initiation Service (PIS). SAMA is also tracking the development of banks and fintechs to ensure their readiness to launch Open Banking services within the first quarter of 2023.
According to the official press statement, Open Banking is a new concept in the financial industry. It is the practice of enabling customers of financial institutions to share their financial data securely with a third-party provider, which in turn provides new and innovative financial services and products for customers. Moreover, Open Banking creates a positive impact on the industry by strengthening the partnership between banks and fintechs. It also improves the financial infrastructure and guarantees better use of financial data for customers.
The Open Banking Programme is one of the initiatives of the Fintech Strategy, one of the pillars of the Financial Sector Development Programme (FSDP) under Saudi Vision 2030. The Fintech Strategy was approved by the Council of Ministers in May 2023, and it aims to make the Kingdom a global fintech hub where technology-based innovation in financial services is the foundation to improve the economic empowerment of individuals and society.
As stated by the official press release, SAMA permitted several fintechs to provide Open Banking services under the umbrella of SAMA Regulatory Sandbox. This step came in parallel with the Open Banking Programme, with a view to testing some new business models and identifying the regulatory and technical challenges, which were considered when developing the Open Banking Framework, the official press release concludes.
In August 2022, the Saudi Central Bank granted permit to Lean Technologies and Mod5r to its Regulatory Sandbox. The new additions brought the total number of permitted fintech companies operating under the central bank’s Regulatory Sandbox to 38. Following up on this piece of news, in November 2022, Lean Technologies onboarded Wally, a personal finance management platform, after receiving permits from Saudi Central Bank.
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