Saudi Arabia grants digital banking licence to two firms

DUBAI: Saudi Arabia has granted digital banking licence to two firms as the use of finance technology spreads in the Middle East.

STC Pay, launched by the kingdom’s biggest mobile operator Saudi Telecom in 2018, will be converted into a digital bank with a capital of 2.5 billion riyals (US$667mil or RM2.78bil), according to a central bank statement. It will be called STC Bank.

A second firm, led by Abdul Rahman Saad Al-Rashed & Sons Co, will form a digital bank with a capital of 1.5 billion riyals (RM1.67bil). It will be called Saudi Digital Bank.

Saudi Telecom said it will inject additional 802 million riyals (RM890.96mil) to retain its 85% in STC Pay and Western Union will invest 750 million riyals (RM833.19mil) to own 15% of the firm. Western Union acquired the stake in STC Pay last year for US$200mil (RM833.3mil).

The central bank also said licensed 16 Saudi fintech companies in the recent past will provide payment services, consumer micro-finance and digital insurance brokerage. ― Bloomberg