Saudi Arabia’s Public Investment Fund is investing in the creation of a new digital bank being established in the kingdom with a capital of 1.65 billion riyals ($440 million), according to a report from Bloomberg.
The digital bank will be established with a capital of 1.65 billion Saudi Riyals ($440 million) through a consortium of individual and corporate investors, with the Public Investment Fund as one of the key investors and will be led by Derayah Financial Company, according to a statement from Saudi Arabia’s central bank.
“The establishment of D360 Bank comes as an extension of the continuous support of the Kingdom’s leadership towards various sectors, including the financial sector,” the statement said.
Digital banks are financial technology firms that do not have a physical presence (are “branchless”) aimed at tech-savvy customers and provide all the banking and financial services through a digital platform.
SAMA says it has been “actively engaged in keeping pace with the latest developments in the financial industry to be in line with the objectives of the Financial Sector Development Program -one of the Saudi Vision 2030 programs- that seeks to develop the digital economy; enables financial institutions to support private sector growth and provides opportunities to new companies and start-ups to provide financial services.”
Currently, two local digital banks have been recently licensed to conduct banking business in the Kingdom, bringing the total number of licensed banks in the Kingdom to 35, including 11 local banks, 3 local digital banks, and 21 foreign bank branches.
SAMA says it has been “working relentlessly to develop and support innovation in the banking sector in partnership with Fintech companies to reap the benefits of the technological revolution for the financial sector and the economy at large while maintaining financial stability and protecting players in the banking sector and related parties.”
