Innovative bank with a focus on fintech collection
It is important to make consumers see the value of open banking to promote open finance in the long term, fintech experts said at a forum in Saudi Arabia on Monday.
“Customers need to see the real value,” said Sultan Al-Hamidi, head of business at the Social Development Bank, during a panel discussion at the World Fintech Show in Riyadh. SDB is a Saudi development bank based in Riyadh.
In collaboration with a few other banks, SDB launched its first savings product for the low-income segment in 2019. The product has now attracted about 150,000 customers, pulling in about 300 million Saudi riyals ($79.8 million) in savings.
Open banking is a practice that allows third-party financial service providers to have open access to financial data from financial institutions with customers’ consent through the use of application programming interfaces, or APIs.
In November, the Saudi Arabian Central Bank issued the Open Banking Framework as one of the key deliverables of an open banking program, which is part of Saudi Arabia’s broader fintech strategy linked to Saudi Vision 2030, a development plan to reduce the nation’s dependence on oil.
Cashless societies
Karl Tlais, founder and strategic advisor at iAdvisory consultancy in Dubai, said that when it comes to cashless societies, the three core ingredients are technology, regulatory governance and culture of adoption.
During the pandemic, digital wallet platforms such as WeChat Pay and Alipay in China and GrabPay in Southeast Asia have achieved success, Tlais said, adding that e-wallets were born out of the idea of open banking, and it is important to understand how they have lasted the economy in motion through technology.
Tlais said more innovative integration and a higher level of personalization are needed for banking as the income of Generation Z – people born between 1995 and 2010 – is expected to reach $33 trillion by 2030.
Aamir Janjua, product manager at open banking provider Spire Tech, said that what matters most in open banking is the value that can be delivered to consumers.
“At the end of the day, consumers don’t really care what kind of technology is used as long as they get options and value,” Aamir said, adding that there is also a need to simplify the open banking process and make the ecosystem more mature and secure to connect different parties.
Held on Monday and Tuesday, the World Fintech Show brought together government officials, global fintech experts, startups and investors to discuss the fintech ecosystem in Saudi Arabia.
