FinTech: Ecosystem, Opportunities and Challenges in Saudi Arabia

Abstract

FinTech is a disruptive international phenomenon that is expected to shape the future of the financial sector. This study describes the features and characteristics of the current Saudi Arabian FinTech landscape and ecosystem. Examples of innovative financial startups in Saudi Arabia, including online banking, transfer and payment services, crowdfunding platforms, peer-to-peer lending, and blockchain initiatives, are discussed. Several changes have occurred within the ecosystem in the last five years; for example, Saudi banks are taking a more cautious approach. However, FinTech initiatives are also being internally developed, encouraging technology companies and startups to focus their efforts on innovations aimed at improving current processes rather than novelty. The government directs its effort mainly toward initiatives related to regulations and laws. Customers are interested in new products that are convenient and easy to use. We compare the Saudi FinTech ecosystem to the United Arab Emirates’ FinTech ecosystem and conclude with recommendations for the different stakeholders.