An Islamic bank has become the first financial institution in Saudi Arabia to successfully complete the technical permit requirements to enable open banking services under new regulations set by the Saudi Central Bank (SAMA).
With the technical permit, Bank Albilad is now able to facilitate the sharing of customers’ financial data with its partners to enable the engineering of new products and enhancement of banking services.
“We took the initiative to enable the open banking services in order to support and enable the fintech system and innovation in the financial sector, as it is one of the pillars of the financial sector development program emanating from the Kingdom’s Vision 2030,” said Abdul-Aziz Al-Onaizsan, CEO of the Islamic bank.
SAMA released the Open Banking Framework last November outlining regulatory guidelines and technical standards based on international best practice to enable both banks and fintech companies to provide open banking services in Saudi Arabia. The Open Banking Framework is a result of Saudi’s Open Banking Program, an initiative under a national fintech strategy approved in May last year.
According to SAMA’s strategy, the first phase of open banking services focuses on account information services while the second will focus on payment initiation services. The regulator has licensed at least nine companies to offer open banking solutions under its regulatory sandbox including Wally Global Arabia, Sanam Aliliddikhar for Information Technology, Istishraf Al-Bayanat for Financial Technology, Spare Arabian Financial Company, Lean Technologies, Mod5r, Tarabut Gateway Company for Information Technology, Umg Alholol Trading Co (known as Single View) and Drahim App for Financial Technology.
Obtaining the open banking technical permit is part of Bank Albilad’s digital transformation strategy: in June last year, the bank inaugurated an innovation center known as HORIZON to incubate fintech innovation and entrepreneurship ideas.