LONDON: British inflation gathered speed in December, starting what is expected to be a climb this year as pandemic-fighting measures, Brexit and a recovery in the economy combine to push up costs for consumers and businesses.
Consumer prices rose 0.6 percent in annual terms after a 0.3 percent increase in November, the Office for National Statistics said.
A Reuters poll of economists had pointed to a rate of 0.5 percent.
A temporary easing of COVID-19 travel restrictions helped to push up air and sea fares while a rise in global oil prices made fuel more expensive and the price of clothes also rose.
Inflation has been below the Bank of England’s 2 percent target since mid-2019 and the COVID-19 pandemic pushed it close to zero as the economy tanked.
But it is likely to rise as the impact of value-added tax cuts and other emergency pandemic measures fade from the statistical comparisons, and because of Britain’s new, less open trading relationship with the European Union.
“We are going to be talking a lot more about inflation in 2021 than we did 2020,” said Jeremy Thomson-Cook, an economist at foreign exchange company Equals Group. “Both Brexit and COVID-19 are factors that have caused substantial pain for businesses and their supply chains.”
A Reuters poll of economists published last week showed inflation is likely to rise to close to the BoE’s 2 percent target by the end of this year, and some like Capital Economics think it will peak at 2.5 percent.
But economists see little pressure on the BoE to start raising interest rates from their all-time low any time soon with Britain’s economy still about 10 percent smaller than before the pandemic.
Samuel Tombs, an economist with Pantheon Macroeconomics, said a rise in unemployment after the end of the government’s job protection scheme — scheduled for April — was likely to keep a lid on domestic inflation pressures.
“The (BoE) will not need to even talk about the prospect of interest rates rising in future within the next two years,” Tombs said.
The ONS said air and sea fare prices rose last month, making transport services the biggest contributor to the increase in inflation during December.
Prices at petrol pumps rose by 1.5 pence per liter.
Clothing and footwear prices — which rose last month, unlike in December 2019 — also contributed to higher inflation.
The ONS said factory gate prices fell last month by the least in annual terms since March, down 0.4 percent, and the measure for core output prices rose by the most since September 2019, up 1.2 percent.
UK inflation starts climb as effects of COVID-19 and Brexit combine
https://arab.news/8bdj9
UK inflation starts climb as effects of COVID-19 and Brexit combine
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2021/01/20/2436211-1158636398.jpg?itok=XOuFsjbn)
- Inflation has been below the Bank of England’s 2 percent target since mid-2019
- ‘We are going to be talking a lot more about inflation in 2021 than we did 2020’
Monsha’at revolutionizing SME landscape in Saudi Arabia
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2024/08/31/4519312-700767162.jpg?itok=RyNErbeG)
- Strengthening the SME sector is crucial for Saudi Arabia, as the Kingdom is currently pursuing its economic diversification journey
- Monsha’at aims to increase the SME contribution to Saudi Arabia’s gross domestic product to 35 percent by the end of this decade
RIYADH: As Saudi Arabia continues its economic diversification journey, the General Authority for Small and Medium Enterprises continues to spearhead several initiatives designed to propel the growth of the Kingdom’s private sector.
The authority, also known as Monsha’at, ushered in a wave of initiatives this year, including strong efforts to boost financing for small and medium enterprises in the Kingdom, along with other programs aimed at strengthening entrepreneurship culture among Saudi citizens.
In February, a report released by the authority revealed that the number of SMEs in Saudi Arabia reached 1.3 million by the end of 2023, representing a quarter-on-quarter rise of 3.1 percent.
Monsha’at, at that time, said that this growth in the number of SMEs was driven by robust public investment, strong entrepreneurial drive, and the region’s leading venture capital investments.
Strengthening the SME sector is crucial for Saudi Arabia, as the Kingdom is currently pursuing its economic diversification journey by reducing its dependence on oil.
With its various initiatives, Monsha’at aims to increase the SME contribution to Saudi Arabia’s gross domestic product to 35 percent by the end of this decade. The report also added that the Riyadh Expo in 2030 is also expected to be a major boon for Saudi SMEs.
“SMEs across the ecosystem will also benefit from nearly $1 trillion being invested in Riyadh over the next seven years, especially firms that prioritize sustainability, innovation, and creativity in sync with broader diversification efforts led by Vision 2030,” said Monsha’at in the report.
Here are some of the significant developments and initiatives undertaken by Monsha’at this year.
Financing initiatives
In May, Monsha’at signed a memorandum of understanding with Saudi Arabia’s Social Development Bank, allowing the authority to join the bank’s Entrepreneurs Program – a financing product aimed at supporting the assets and operating costs of new business entities in the Kingdom.
According to a Saudi Press Agency report published at that time, Monsha’at will work to provide training and advisory services to further empower entrepreneurs who benefit from the bank’s entrepreneurs program through support centers in Riyadh, Madinah, Jeddah, and Alkhobar.
Under the terms of the agreement, SDB will work to process the submitted lending applications and make the appropriate decisions regarding them.
In July, another report by Saudi Arabia’s SME Bank noted that it provided SR1 billion ($270 billion) to micro, small, and medium-sized enterprises in the Kingdom from its launch in December 2022 until January 2024.
“The leadership of Saudi Arabia acknowledges the vital role that SMEs play, as they constitute 99 percent of the Kingdom’s businesses. Various initiatives have been put in place to further catalyze their growth,” said Abdulrahman bin Mohammed bin Mansour, acting CEO of the SME Bank at that time.
Another report released by the Saudi Central Bank in June revealed that credit facilities provided by SMEs in the Kingdom surged by 16 percent in the first three months of this year to SR293.43 billion, compared to the same period in 2023.
Supporting entrepreneurship
In 2024, Monsha’at also conducted various programs aimed at strengthening entrepreneurship in Saudi Arabia.
In January, the authority said that it concluded an e-commerce tour across 14 cities and provinces across different regions of the Kingdom, which witnessed the signing of multiple agreements to foster entrepreneurial culture in the e-commerce sector.
In a press statement, Monsha’at revealed that it aimed to support and empower entrepreneurs to benefit from the services and facilities provided by relevant entities, along with promoting the culture of entrepreneurship in the e-commerce sector.
“The tour provided exclusive services and offers to entrepreneurs in all targeted regions to support their entrepreneurial projects and encourage growth by leveraging the opportunities and potentials offered in the field of e-commerce,” said the authority in a statement.
During the tour, Monsha’at signed two cooperation agreements with the M5azn e-store platform and Paydo company, with the goal of supporting and developing the entrepreneurial environment in the e-commerce sector.
“The challenges faced by entrepreneurs in the e-commerce field were addressed, and suitable solutions were provided to overcome them. Furthermore, the tour included diverse training programs on various fields and topics related to the world of e-commerce,” said the authority in a statement at that time.
In the same month, Monsha’at also launched the University Entrepreneurship Council, an initiative aimed at promoting entrepreneurship in Saudi universities.
“The Council aims to promote entrepreneurship in Saudi universities, by analyzing and studying the current situation and discussing ways to spread the culture of entrepreneurship in the university environment and exchanging ideas and experiences that will support university entrepreneurship projects and activate their role in shaping and building the local economic system,” said Monsha’at.
The authority added that this initiative comes within the framework of its efforts to “support and emphasize the entrepreneurial environment in the university sector in the Kingdom, with the aim of enabling and developing the Kingdom’s economy, promoting sustainability in entrepreneurial projects, and addressing all the challenges that entrepreneurs may encounter.”
In January, Monsha’at also launched a guide for establishing commercial innovation centers in Saudi Arabia.
Through this guide, the authority aims to support entrepreneurs and SMEs owners in understanding the necessary steps to establish innovation centers in the Kingdom.
“The guide includes a collection of success stories from local and international entities in the field of establishing innovation centers. These stories have contributed to the establishment and market entry of startups, thus creating new jobs in the market by offering tools, necessary technologies, training, development, and providing consultations and guidance,” said Monsha’at.
In February, the authority organized “Tomoh Wednesday” in collaboration with energy giant Saudi Aramco, aimed at establishing an entrepreneurial environment and building professional relationships, as well as identifying the most prominent challenges that “Tomoh” enterprises may encounter.
VC funding continues to flow for Saudi startups
A report from Magnitt indicated that venture capital funding continued to flow for startups in Saudi Arabia, despite the Middle East and North Africa region witnessing a dip in this sector.
According to this report, Saudi Arabia ranked first in the MENA region for total venture capital funding at $1.33 billion in 2023, representing a rise of 33 percent compared to the same period in 2022.
This trend continued in the first quarter of this year, as venture capital funding to startups in Saudi Arabia hit $240 million.
Monsha’at, in its February report, noted that investment-friendly public policies have played a crucial role in attracting start-ups to establish their bases in the Kingdom.
The authority also added that significant deals involving Tabby, Tamara, Nana, and Floward have propelled fintech and e-commerce to the forefront, with these sectors experiencing 170 percent year-on-year funding growth.
Pharmaceutical industry growth proving just the pill for Saudi Arabia’s healthcare goals
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2024/08/31/4519261-363760902.jpg?itok=8A7cxbd-)
- According to Statista, the pharmaceuticals market in the Kingdom is anticipated to achieve a revenue of $5.53 billion by 2024
- Saudi Arabia is set to see a compound annual growth rate of 4.62 percent, resulting in a market volume of $6.93 billion by 2029
RIYADH: As the Saudi government makes substantial investments in healthcare infrastructure, there is a notable increase in the demand for pharmaceuticals in the country.
According to Statista, a German online platform that specializes in data gathering and visualization, the pharmaceuticals market in the Kingdom is anticipated to achieve a revenue of $5.53 billion by 2024.
While significantly lower than the global leader the US – poised to generate $630.3 billion in revenue in 2024 – Saudi Arabia is set to see a compound annual growth rate of 4.62 percent, resulting in a market volume of $6.93 billion by 2029.
A key factor in fueling this increase is the increasing localization of the pharmaceutical industry – a strategy which plays into the Kingdom’s economic diversification strategy Vision 2030.
“While we will have to ascertain the quantified impact of localization on the pharmaceutical industry in Saudi Arabia, we definitely expect it to increase access, reduce cost and make the local pharmaceutical industry more resilient and innovative,” Partha Basumatary, principal in Oliver Wyman’s India, Middle East and Africa Healthcare and Life Sciences Practice told Arab News.
“Localization initiatives have laid the foundation for the Kingdom to become a regional hub of manufacturing for biotech products for the entire Middle East region,” Basumatary added, noting that the Kingdom’s focus on localization for NCD drugs, particularly those targeting type-2 diabetes, is a strong start.
“To truly maximize its impact, however, the Kingdom needs to expand these initiatives beyond NCDs and encompass other critical areas like cancer, infectious diseases, and auto-immune disorders,” Basumatary said.
According to Matthew Lawrence, director of Pharma and Life Sciences, Operations Transformation Lead at PwC Middle East, the Kingdom’s access to, cost of, and standard of healthcare services have all significantly improved thanks to Saudi Arabia’s transformation of the industry.
As a result of these current localization actions, the pharmaceutical industry in Saudi Arabia will continue to see significant change towards accessibility, quality, and economic impact, Lawrence disclosed.
In terms of accessibility, he told Arab News: “Local production ensures a sustainable economy, reducing reliance on imports, therefore, a stable supply of medications, and faster response time during health crises.”
As for quality, he explained that the Saudi Food and Drug Authority ensures that locally manufactured pharmaceuticals meet high quality standards, which leads to improved healthcare services.
With regard to economic impact, Lawrence noted that the industry’s growth has spurred job creation and attracted investments, aiding in economic diversification.
“According to the Kingdom’s National Biotechnology Strategy, there will be 11,000 job opportunities by 2030, and contribute $34.6 billion to the non-oil GDP, by 2040 - potentially positioning Saudi Arabia as one of the leading global hubs for pharmaceutical manufacturing, research, and innovation,” he said.
“This is a clear testament to the major impact Vision 2030 has created in order to improve the healthcare sector across the Kingdom,” the PwC partner added.
Key steps taken by Saudi Arabia to localize the pharmaceutical industry
In keeping with the Kingdom’s Vision 2030 drive, Saudi Arabia has taken important steps to incentivize local manufacturing.
“First and foremost, it (Saudi Arabia) has offered various incentives to the pharma companies to drive localization, including lower minimum capital requirement, tax incentives, customs duties exemptions etc,” Basumatary said.
“It has also taken steps to improve regulatory approvals for drugs in the country with the introduction of abridged verification and registration processes,” he added, before going on to explain how the Kingdom has also developed a framework to favor locally manufactured products for tenders.
The Oliver Wyman principal highlighted successful examples of localization, such as Boehringer Ingelheim’s partnership with Alpha Pharma for localization of a Type-2 diabetes product in Saudi Arabia.
“Other notable examples include MSD’s partnership with Jamjoom Pharma to localize another Type-2 diabetes drug sitagliptin phosphate. Such initiatives will help the industry to become more resilient when it comes to future outbreaks such as COVID-19,” Basumatary said, adding: “It would also sow the seeds for future innovation and growth of the domestic pharma industry, including potentially giving a positive push to the Kingdom’s aspirations of becoming a regional biotech hub.”
Government support
As expected, the Saudi government plays a pivotal role in accelerating the localisation of the pharmaceutical industry and is already investing in driving strategic programs to advance the healthcare system:
From Oliver Wyman’s perspective, Basumatary said: “As observed in other geographies, Singapore government’s stable policy framework, favorable incentives, and access to knowledge/talent motivated BionTech to establish a state-of-the-art mRNA manufacturing facility in the country.”
The principal further noted that the pharmaceutical industry expects enhanced market accessibility, support for localization, and strong IP protection when it comes to making localization decisions.
“Saudi Arabia’s involvement and support has delivered an impact as we have seen from the recent pharma localization initiatives. It will, however, be critical to continue innovating on that front, as the competition for such localization initiatives continues to increase globally and regionally,” he underlined.
PwC Middle East’s Lawrence revealed that some of the notable government efforts include favorable policies like tax incentives and labor laws to incentivize research and development as well as manufacturing.
They also entail enabling regulatory frameworks to drive life science sector growth, with measures around strong intellectual property laws, patent protection, mutual recognition agreements to facilitate market access, and competition laws.
Other initiatives include not-for-profit funding, such as targeted grants, to incentivize research, as well as public financing such as subsidies or incentives to enable long-term growth of the healthcare ecosystem.
“The government's ongoing commitment to localization is a clear long-term strategic plan, building on Vision 2030. The alignment of government policies with Vision 2030 goals underscores their influence in driving the progress of pharmaceutical localization across the Kingdom,” Lawrence said.
“These policies and initiatives will not only attract future investment but also foster innovation, build local capabilities, and ultimately contribute to the sustainable growth of the healthcare sector,” he added.
Looking to the future
In recent years, Saudi Arabia has intensified its focus on life sciences and has made substantial advancements to align with the objectives of Vision 2030.
This has involved endeavors to enhance the overall health and well-being of individuals, promote economic expansion and diversity, reinforce the Kingdom's global leadership in the sector, stimulate innovation, and enhance patient outcomes and quality of life.
According to Lawrence, one of the key initiatives contributing to the advancements of the life science industry is national biotechnology strategy.
“This helps to develop end-to-end vaccine manufacturing, establish biotechnology platform for biologics and biosimilars, and expands genomics programs for preventative medicine,” Lawrence told Arab News.
The PwC partner also shed light on the Healthcare Sector Transformation Program, explaining that it is responsible for strategizing the Kingdom’s resilient supply chain through different initiatives that help in enabling the localization of the pharmaceutical industry.
Other key players include the Local Content and Government Procurement Authority, which works on enhancing awareness and participation in local content and provides knowledge-based policies and tools, as well as the National Industrial Development and Logistics Program which focuses on expanding the pharmaceutical manufacturing sector.
It also includes incentives for local and international companies to establish production facilities in Saudi Arabia.
The Saudi Food Drug Administration is also playing a pivotal role as it enhances regulatory frameworks to help speed up the approval process for new drugs and encourage innovation in local pharmaceutical production.
Pharmaceuticals and Vision 2030
The strategic initiatives of the pharmaceutical industry are closely aligned with the Kingdom’s Vision 2030 goals, echoing ambitions in economic diversification, job creation, and innovation, as well as technology transfer and self-sufficiency.
“Life science sector expansion is expected to create thousands of jobs, helping to reduce unemployment rates among Saudis, particularly in high-skilled areas. Encouraging partnerships and collaboration leads to technology transfer and innovation,” Lawrence said.
With regards to self-sufficiency, the PwC partner noted that localizing pharmaceutical production ensures a stable supply of essential medicines and reduces the health sector's vulnerability to global supply chain disruptions.
“These initiatives are aligned with Vision 2030 goals as they contribute to the Kingdom’s economic growth, job creation and localization initiatives for Saudi nationals, as well as the enhancement of healthcare services across the country,” he said.
“By localizing the pharmaceutical industry and expanding these initiatives, Saudi Arabia can further improve healthcare accessibility, reduce healthcare costs, and ensure sustainability in the healthcare demands of its growing population,” Lawrence said.
Reforms to Saudi legal sector set to attract foreign law firms to the Kingdom
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2024/08/31/4519264-1966223823.jpg?itok=1CpXncVn)
- This initiative is part of a broader strategy to attract foreign investment and enhance the Kingdom’s business environment
RIYADH: Saudi Arabia is on the brink of a transformative policy shift that would permit licensed foreign law firms to establish companies fully owned by non-Saudis.
This initiative, announced by the National Competitiveness Center, is part of a broader strategy to attract foreign investment and enhance the Kingdom’s business environment.
The NCC has solicited public feedback on a Ministry of Justice proposal through its official account on X, which could fundamentally reshape the legal landscape in Saudi Arabia.
A progressive legal reform
The proposal seeks to amend the first paragraph of Article 50 of the Kingdom’s Code of Law Practice. If enacted, it would allow non-Saudi law firms to set up wholly foreign-owned professional companies.
These firms would offer legal advice on the Kingdom’s regulations and represent clients in court through registered Saudi lawyers.
Details posted on the Istitlaa platform reveal that this project aims to advance the legal profession, improve the quality and efficiency of the industry, and integrate global expertise into the local context.
Furthermore, it is designed to bolster the Kingdom’s competitiveness, enhance its business climate, and elevate the efficiency of the justice system by increasing professionalism within the legal sector.
The proposed amendment signifies a progressive step in Saudi Arabia’s legal reforms.
By allowing foreign law firms to operate independently, the Kingdom aims to develop its legal profession by introducing international standards and practices.
Lebanon-based attorney Jihad Chidiac told Arab News that permitting foreign law firms to set up offices in Saudi Arabia enhances the quality of legal services by combining global expertise and experience with local knowledge and specificities.
He added: “These firms operating according to international legal standards may encourage the development of a more solid legal framework and regulatory environment, which is essential for attracting foreign investment and fostering a transparent business environment.”
![](https://www.arabnews.com/sites/default/files/pictures/August/3854151/2024/jihad_chidiac.jpg)
Homam Khoshaim, a partner in corporate finance at London-based law firm Addleshaw Goddard, echoed this sentiment, and told Arab News: “The entry of additional international law firms in the Kingdom indicates a growing legal sector, healthy competition among legal services providers, and a growing economy that demands its legal needs be met.”
He added: “Clients stand to benefit from a more diverse legal market offering a wider range of services, deeper expertise, and international networks. This is especially advantageous for Saudi-based clients that operate globally.”
![](https://www.arabnews.com/sites/default/files/pictures/August/3854151/2024/homam_khoshaim_partner_addleshaw_goddard.jpg)
Boosting competitiveness and investment
This initiative aligns with Saudi Arabia’s broader goals of stimulating foreign investment and encouraging international companies to relocate their regional headquarters to the Kingdom.
By creating a more attractive legal environment, the Kingdom hopes to draw significant foreign capital, which will, in turn, fuel economic growth and diversification.
Talat Hafiz, a Saudi-based economist, highlighted to Arab News believes there will “definitely” be “more foreign investments” in Saudi Arabia as a result of the changes, adding: “It will help localize some industries, transfer know-how, and create thousands of job opportunities for Saudi nationals.”
![](https://www.arabnews.com/sites/default/files/pictures/August/3854151/2024/talat_hafiz.jpg)
The ability for foreign law firms to operate independently is expected to improve the ease of doing business in the Kingdom, making it a more attractive destination for international firms.
The legal reforms are seen as a critical component of this effort, aiming to create a robust legal infrastructure that supports economic activities and offers high-quality legal services to both local and foreign entities.
Supporting Vision 2030 goals
The initiative is also in line with Saudi Arabia’s ambitious Vision 2030 objectives, aimed at reducing the Kingdom’s dependence on oil, diversifying its economy, and developing public service sectors.
Chidiac pointed out that this policy could “support several objectives of Vision 2030, particularly in terms of attracting more foreign investors and multinational corporations that seek international, modern, and innovative legal infrastructure in business and commercial transactions.”
Foreign legal firms can support economic diversification by providing legal services in finance, energy, infrastructure, and technology.
Chidiac said: “The Saudi legal market is increasingly significant on both a regional and global scale, largely due to the country's ambitious economic diversification plans under Vision 2030.”
He added: “The legal market in Saudi Arabia is directly impacted by these expansive projects, which necessitate a wide range of legal services, from corporate and finance to energy, projects, and infrastructure, as well as dispute resolution.”
Creating employment opportunities
One of the key benefits of this proposed change is the potential for job creation.
By attracting foreign law firms, the initiative is expected to generate a range of employment opportunities for Saudi citizens, both directly and indirectly. This includes roles within the legal profession as well as ancillary services that support legal firms.
Chidiac added that “the establishment of foreign legal firms will create job opportunities, most importantly in the legal sector, by providing direct employment opportunities for local lawyers, paralegals, and administrative staff.”
He explained that foreign legal firms can create indirect employment opportunities by helping companies operate more effectively, stimulating economic growth, and fostering entrepreneurship, thus creating a favorable ecosystem for business development in Saudi Arabia.
The influx of foreign law firms is expected to stimulate the local job market by providing new career paths for Saudi nationals. This aligns with the government’s efforts to reduce unemployment and increase the participation of Saudi citizens in the workforce.
The unemployment rate in Saudi Arabia fell to 7.6 percent in the first quarter of 2024, compared to 7.8 percent in the fourth quarter of 2023, according to the General Authority for Statistics’ labor force survey.
By offering competitive salaries and professional development opportunities, foreign law firms can attract and retain top legal talent in the Kingdom.
“Investing in local talent is crucial for gaining insights into the legal system and ensuring cultural alignment. Firms must commit to continuous learning to adapt to rapid legal changes, ensuring the team is well-versed in new laws and regulations,” Khoshaim said.
A new era for the Saudi legal sector
This proposed amendment represents a significant step forward for the Saudi legal sector. By opening the doors to foreign law firms, Saudi Arabia is signaling its commitment to modernizing its legal framework and aligning it with international standards.
This move is expected to not only enhance the quality of legal services available in the Kingdom but also to make Saudi Arabia a more competitive and attractive destination for global businesses.
In order to ensure the proposed changes are well-received and able to be successfully implemented, the Ministry of Justice has initiated a public consultation, seeking opinions from lawyers, foreign law firms, specialists, academics, businesses, and the general public.
As Saudi Arabia moves forward with this proposed amendment, the legal community is watching closely. The successful implementation of these reforms could serve as a model for other countries in the region, showcasing the benefits of a modern and open legal market.
By embracing international standards and practices, Saudi Arabia has the potential to become a leading legal center in the Middle East, attracting top legal talent and fostering a dynamic business environment.
Saudi Arabia records 21% surge in credit card loans to reach $8bn
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2024/08/30/4519000-900331061.jpg?itok=2SEc77jn)
RIYADH: Saudi banks recorded a 21 percent annual surge in credit card loans in the second quarter of 2024, reaching SR30.04 billion ($8.01 billion), according to official data.
Figures from the Saudi Central Bank, also known as SAMA, showed that this is the highest quarterly figure reported, and the most substantial annual growth seen in a year.
Consumer loans – typically paid back in installment, used for significant purchases and often featuring lower fixed interest rates than credit cards – rose by a modest 2 percent to reach SR452.32 billion during this period.
According to SAMA, these loans exclude real estate financing, finance leasing and margin lending.
In their Critical Consumer 2024 report, consultancy firm AlixPartners stated that Saudi Arabia’s preference for digital and credit card payments matches that of Switzerland and surpasses Germany.
Payment cards are dominating Saudi Arabia’s financing ecosystem, driven by government-led economic inclusion initiatives under Vision 2030. This strategy focuses on digital transformation and reducing cash transactions in favor of electronic payments.
The adoption of contactless transactions, accelerated by the COVID-19 pandemic, has fueled the growth of card usage. Additionally, rising banking penetration, improved infrastructure, and increased retailer acceptance, are driving the market’s development.
The government’s push to reduce cash reliance and promote fintech innovation under Vision 2030 is further advancing the payment card market.
According to a July report by Global Data, key players in Saudi Arabia’s cards and payments market include Al Rajhi Bank, Saudi National Bank, and SAB, as well as Alinma Bank, and Visa.
To boost card penetration, banks are tailoring credit cards to different customer segments.
A Titanium Mastercard is Shariah compliant, and provides perks including free VIP lounge access, purchase protection, and installment options.
Some banks target students with a Visa Signature credit card, designed for those enrolled in accredited Saudi universities, and offering installment payment options along with reward points through the Akthr Program.
According to Global Data, recent developments in Saudi Arabia’s cards and payments market include the launch of pilot digital banking services by two of the three licensed digital banks – STC Bank and D360 – in 2023, as noted in the Financial Sector Development Program annual report.
Additionally, Buy Now Pay Later services are growing in popularity, especially among Generation Z consumers.
To regulate this emerging market, the Saudi Central Bank introduced new rules for regulating BNPL companies in December 2023.
These included establishing licensing requirements for such firms and setting minimum standards for offering these services, focusing on consumer protection, sector growth, and sustainability.
Rules also focused on provisions on licensing, internal regulatory measures, information security, and financial crime prevention, along with guidelines for supervision and compliance.
BNPL services can contribute to a more dynamic, inclusive, and innovative payment market in Saudi Arabia, supporting both consumer needs and business growth.
Consumer spending in Saudi Arabia is expected to remain strong in the coming year, despite global economic uncertainties, according to a study by management consulting firm AlixPartners.
This resilience stands in contrast to the broader Europe, the Middle East and Africa region, where 37 percent of consumers plan to cut back on spending in 2024 compared to the previous year, according to the study.
Saudi Arabia’s stable spending environment persists amid global challenges like persistent inflation and geopolitical instability, with some sectors still grappling with post-pandemic recovery.
In contrast, Saudi consumers are increasingly embracing online shopping, with e-commerce growing in popularity. The study showed that while international companies currently dominate this retail landscape, there is a noticeable shift toward homegrown businesses.
The AlixPartners study showed that Saudi Arabia is at the forefront of artificial intelligence adoption for shopping research, with consumers showing strong enthusiasm for innovative solutions like AI-powered tools for holiday bookings.
According to TechSci Research, Saudi Arabia’s AI market in retail and e-commerce was valued at $245 million in 2023 and is expected to experience substantial growth from 2025 to 2029.
According to the study, the sector is evolving rapidly as technology reshape customer experiences, streamline operations, and improve business decision-making.
AI-powered chatbots and virtual assistants are increasingly common, offering personalized customer support and enhancing engagement, while recommendation engines use advanced algorithms to analyze consumer preferences and provide customized product suggestions, boosting sales and satisfaction.
Additionally, AI optimizes supply chain management through predictive analytics and machine learning, reducing costs and ensuring product availability.
Startup Wrap – Regional venture activity sees mix of funding, acquisitions, and accelerator graduations
![](https://www.arabnews.pk/sites/default/files/styles/n_670_395/public/main-image/2024/08/30/4518974-120685602.jpg?itok=z9n27wtv)
RIYADH: The startup ecosystem in the Middle East continues to evolve, marked by significant funding rounds, strategic acquisitions, and new investment initiatives.
An alliance of investors and family offices based in the Gulf Cooperation Council has launched Waad Investment, a firm with a targeted value of SR750 million ($200 million), making it the largest such private entity dedicated to supporting growth-stage startups in the region, according to a release.
The alliance, led by Saudi businessman Yaser Al-Ghamdi, founder and chief investment operations officer of Waad Investment, involves a collaboration with the AlMajed and AlMisfer family offices to create a platform for entrepreneurial growth.
Waad Investment is designed to foster the private sector’s role in driving innovation and economic development, with a particular focus on providing not only financial investments but also a network of connections, mentorship, and guidance to startups.
“The company will bridge the financial gap many startups face and will offer comprehensive support that includes financial investment, mentorship, and guidance,” said Al-Ghamdi.
The firm is part of a broader vision to enhance the innovation landscape in the GCC, with family offices and investors aiming to generate a diverse and sustainable economy based on knowledge and technology.
15 startups graduate from the first cohort of TDF’s Grow Accelerator program
The Tourism Development Fund, a national enabler of the sector in Saudi Arabia, showcased the progress of 15 startups, which have collectively attracted investments worth over SR18 million to date, in its latest demo day.
The exhibition was for the graduates of the inaugural cohort of its “TDF Grow Accelerator” program at the King Abdullah Financial District Conference Center in Riyadh.
The event attracted investment pioneers, entrepreneurs, media representatives, and key stakeholders within the tourism sector.
Qusai Al-Fakhri, CEO of TDF, highlighted the critical role of the fund’s programs in promoting innovation and sustainable growth in the Kingdom’s tourism industry.
In a speech delivered on his behalf by Prince Saud Bin Mohammed, executive director of TDF Grow, Al-Fakhri expressed pride in the achievements of the startups, and said: “This success reflects our ongoing commitment to supporting entrepreneurial ideas and promising initiatives that contribute to efficiently implementing the national tourism strategy and reinforcing the Kingdom’s standing as a global tourism destination.”
KBW Ventures invests in Saudi Arabia’s KASO
![](https://www.arabnews.com/sites/default/files/pictures/August/3428266/2024/screenshot_2024-08-30_at_10.13.41.png)
KBW Ventures, led by Prince Khaled bin Al-Waleed, has announced an investment in Saudi business-to-business food tech startup KASO.
The company specializes in streamlining procurement processes for the food and beverage sector by digitizing and automating the logistics between restaurants and suppliers.
Prince Khaled noted that KASO had been under KBW Ventures’ consideration for some time before the investment was made.
“We want to grow our allocation into B2B SaaS. KASO not only checks the boxes on return parameters; we also like to see visibility of 10x return for early stage opportunities,” Prince Al-Waleed said.
This investment aligns with KBW Ventures’ broader strategy of supporting sustainability-driven sectors, including food security, alternative proteins, carbon capture, and agricultural technology.
UAE’s Powder Beauty secures pre-series A funding to scale in Saudi Arabia
![](https://www.arabnews.com/sites/default/files/pictures/August/3428266/2024/screenshot_2024-08-30_at_09.14.46.png)
UAE-based e-commerce platform Powder Beauty has successfully closed its pre-series A funding round, led by Sophia Collective and NKEHL, Nithin and Nikhil Kamath.
The round also saw participation from several regional angel investors, including Maha Taibah. The specific value of the funding was not disclosed.
Founded in 2018 by Ayat Toufeeq, Amina Grimen, and Marriam Mossall, Powder Beauty focuses on offering eco-conscious beauty products to its customers.
“With this funding round, we’re driven to build on our leading position in this largely untapped but fast-growing market,” Toufeeq, CEO of Powder Beauty, said.
“We’re delighted to have received this support from investors like the Sophia Collective, a platform whose vision aligns strongly with ours,” she added.
The newly secured funds will be used to scale the company’s operations in Saudi Arabia, furthering its growth in the region.
UAE’s Verofax secures $3m in a bridge round
UAE-based Web3 services provider Verofax has secured $3 million in a bridge funding round, led by King Abdullah University for Science and Technology, Plug & Play Tech Center, Navig8 Group, and Trove Capital UK.
Additional participants included Jawa Brothers Advisory, Alzamil Pedco CVC, and Tracecore CVC.
Founded in 2018 by Wassim Merheby and Jamil Zablah, Verofax leverages Web3 technologies like augmented reality, blockchain, and artificial intelligence to enhance marketing experiences.
The new funding will support Verofax’s expansion in the Middle East and Europe, including AI-powered guides for the GCC and sports fan guides in the EU and North America.
In 2022, Verofax raised $1.5 million in a pre-Series A round, led by Benson Oak Ventures, with participation from 500 Global, Wami Capital, and Vernalis Capital.
Kuwait’s Sakan acquires Qatari proptech Hapondo
![](https://www.arabnews.com/sites/default/files/pictures/August/3428266/2024/screenshot_2024-08-30_at_09.15.48.png)
Kuwait-based proptech company Sakan has acquired Hapondo, a Qatari real estate marketing platform, for an undisclosed amount.
Sakan, established in 2016 by Abdullah Al-Saleh, operates as a real estate marketplace across several GCC countries, including Kuwait, Saudi Arabia, Oman, and Bahrain.
Hapondo, founded in 2019 by Ahmad Al-Khanji, specializes in providing a comprehensive map and photo search for residential units in Qatar.
The acquisition is aimed at expanding Sakan’s services in Qatar by leveraging Hapondo’s existing network and relationships with clients and real estate developers.
Web3 streaming platform myco raises $10 million in Series A
UAE-based Web3 streaming platform myco has completed the first closing of its Series A funding round, raising $10 million at a post-money valuation of $80 million.
The round was backed by Daman Investments, Aptos Labs, B Digital, Mocha Ventures, Art3 Foundation, Ghaf Capital Partners, Mix Media Network, Factor6 Capital Partners, and Enjinstarter, alongside 88 accredited investors who participated through Republic.com.
Founded in 2021 by Umair Masoom and Somair Rizvi, myco is a content streaming application that integrates ad-based and subscription video on demand within a decentralized environment.
The fresh funds will support myco’s expansion into new markets and partnerships, following its recent growth into North America and Egypt. The company plans to conclude a second closing of their series A by early 2025.
“Myco has already demonstrated our ability to scale in key markets, achieving exceptional metrics in user growth, retention, revenue, and community building. With this new capital, we plan to replicate our success by expanding into markets with similar demographics and strong regional partnerships.” said Masoom, managing director of the firm.
Bahrain’s Tenmou invests in two local startups
![](https://www.arabnews.com/sites/default/files/pictures/August/3428266/2024/nwf_lkwhjy.jpeg)
Bahrain-based angel investment company Tenmou has invested in two Bahraini startups – Tajweed and Travilege.
Founded in 2021 by Salman Al-Marzooq, Travilege is an enterprise resource planning software designed for travel agencies, while Tajweed, founded by Khalil Alqaheri, is a digital platform focused on teaching the Holy Qur’an and Arabic language.
Tenmou’s investment aligns with its strategy to promote angel investing in technology startups that have rapid expansion potential.
The company is focused on fostering a robust ecosystem for tech-driven businesses in Bahrain and the wider region.