Saudi-based fintechs now employ over 6,500 people Sector generated $245 billion in revenue in 2023 and is expected to grow six-fold by 2030, said Boston Consulting Group RIYADH: Saudi Arabia’s financial technology startups have secured over $1.84 billion in venture capital investments since 2018, according to the latest official report. Saudi Arabia’s General Authority for Small and Medium Enterprises, also known as Monsha’at, said that since the launch of the Fintech Saudi initiative in 2018, the sector has flourished and investments have been directed into 216 Saudi-based fintechs, which now employ over 6,500 people. This significant capital influx underscores the rapid growth of the Kingdom’s fintech sector, now the largest in the Middle East and North Africa region. The Kingdom’s National Fintech Strategy, a key element of Vision 2030’s Financial Sector Development Program, aims to establish 525 fintechs, create 18,000 jobs, and contribute $3.5 billion to the economy by 2030. The Saudi Central Bank, also known as SAMA, has been instrumental in fostering the fintech ecosystem’s growth. Speaking to Arab News, Yazeed Al-Nafjan, deputy governor for financial innovation at SAMA, emphasized the role of fintech in bolstering the economy. “The Saudi fintech sector has experienced significant growth as the number of active fintech companies reached 224 by the end of Q2 2024. As a testament to our leadership’s wise support for the sector, Saudi Arabia led the region in venture capital investment in 2023, while fintech investments remained the most popular sector for venture capitalists,” he said. “By Q2 2024, the sector had created over 7,000 direct jobs, creating rich and transformative opportunities for thousands of inventive and highly motivated young people,” Al-Nafjan added. “Given their tremendous impact on the national economy,” he said SAMA will continue to support and empower SMEs through various Monsha’at initiatives. Among the most notable is a program called “Effective Mechanisms for Financing Fintech SMEs,” which, according to Al-Nafjan, provides incentives and financial support for SMEs in the fintech ecosystem. This enables financial institutions to support private sector growth and contribute to achieving the objectives of the fintech strategy. He said that SAMA is committed to developing the financial sector through initiatives such as the development of the national payments infrastructure and fostering entrepreneurship. “Since 2018, for example, SAMA’s Regulatory Sandbox has graduated over 60 fintech business models now operating in the Saudi market,” Al-Nafjan added. The SME Monitor report also highlighted global fintech trends, noting that the sector generated $245 billion in revenue in 2023 and is expected to grow six-fold by 2030, according to Boston Consulting Group. Emerging technologies such as mobile wallets, open banking, buy now, pay later solutions, and advancements in artificial intelligence and machine learning are driving this growth. By 2030, fintech could account for 7 percent of all financial services revenues globally, up from 2 percent in 2023. In the broader context of Saudi Arabia’s entrepreneurial landscape, Monsha’at’s various upskilling, enablement, financing, business development, franchising, and expansion programs have benefitted over 20,000 SMEs in the second quarter of the year. The Kingdom also witnessed a 78 percent year-on-year increase in new commercial registrations during this period, with 121,521 new applications recorded. Notably, 47 percent of these registrations were made by female-owned establishments, highlighting the dynamic and increasingly diverse nature of Saudi Arabia’s private sector. Saudi-based startups continued to lead the MENA region in venture capital funding in the first half of the year, securing 54 percent of all venture capital financing in the region, with $412 million deployed across 63 deals.