In line with its commitment to developing and supporting innovation in the local banking sector, the Saudi Central Bank (SAMA) has granted a license to a new Shariah compliant digital bank — the third neobank to be established in the Kingdom.
D360 Bank, which will be established with a capital of SAR1.65 billion (US$439.39 million) through a consortium of individual and corporate investors led by Derayah Financial Company, had also received approval from the Council of Ministers for the license.
The neobank is backed by the Saudi sovereign wealth fund, the Public Investment Fund, as a key investor, as well as other venture capital (VC) companies, including Hala Ventures and STV.
“By investing in D360 Bank, we are backing what we expect to become the leading one-stop-shop Shariah compliant digital bank for all in Saudi Arabia, providing hassle-free and intuitive financial and banking products,” STV said.
“While traditional banks see their digital banking as a subset of their offering, the digital bank has this proposition front and center, at the core of its existence,” STV said, adding that it was impressed by the D360 team.
Meanwhile, SAMA is confident that the establishment of the new digital bank is in line with the objectives of the Financial Sector Development Program under the Saudi Vision 2030, which seeks to develop the Kingdom’s digital economy and support financial services start-ups.
In mid-2021, the Saudi cabinet had announced the establishment of two digital banks: Shariah compliant Saudi Digital Bank, one of whose founding members is Al-Moamar Information Systems Company; and Saudi Digital Payments Company, which is owned by Saudi Telecom Company.
The latest license approval brings the total number of licensed banks in Saudi Arabia to 35, including 11 local banks, three digital banks and 21 foreign bank branches. The central bank has also licensed 19 Saudi fintech companies, a majority of which operate under Shariah principles.