Fintech in action in Saudi Arabia
https://arab.news/r5kqy
One of the impactful initiatives implemented by the Capital Market Authority (CMA) under its chairman, Mohammed El-Kuwaiz, was the creation of the Capital Market Institutions Committee (CMIC).
The committee consists of 10 CEOs who represent a broad bandwidth of the licensed financial institutions, with the main objective to keep an active and direct dialogue between CMA management and the management of the 107 licensed institutions. I had the honor to join the first term of the committee and the second term recently kicked off its 2021 meetings.
During our last meeting, due to its importance to the Saudi financial sector development program, we discussed the financial technology trend in the Saudi market and we invited Nejoud Al-Maleek, director of Fintech Saudi, to meet CMIC members. As the financial sector is moving toward more open data use and structured API integration, along with the Open Banking road map introduced by Saudi Central Bank, Fintech Saudi expects to see more fintechs operating in the capital markets as Fintech Lab by CMA is permitting certain fintech in social trading and retail investment options.
Fintech Saudi is also working closely with the different financial sector players by linking them to its members. Fintech Saudi is also trying to negotiate the best terms for its members and run accelerators to connect them with potential investors, to ensure that they are ready to operate.
Things are moving fast in the country. The business community is becoming more sophisticated and asking for speed, accuracy and efficiency, but also with lower costs. Luckily, entrepreneurs from Saudi Arabia and around the world are bringing that needed change and the banking industry globally is being disrupted as never before. It is too early to tell exactly what the impact of this disruption will be, but things are changing quickly and it has the legacy banking system up in arms.
One of those Saudi entrepreneurs whom I met recently is Dr. Mansour Al Hussaini. He developed the Monimove FinTech platform, which is the innovator of next-generation digital credit use, supply chain and trade finance platform using advanced blockchain technology and smart contract solutions. It will present its services to government agencies, banks, oil and petrochemical companies, and giga projects of the Public Investment Fund (PIF). Monimove aims to develop a safe and healthy economic environment. Last week, Monimove appointed BMG Financial Group as its financial adviser to secure value-added strategic investors who believe in the future of technology.
Speaking of technology, with its losses of $125 million back in 1999, Wall Street analysts were debating the survival of Amazon compared with its competitor Sears. Back then, skeptics said that Amazon would have to sell every book being sold in the world to justify its stock price.
Well, since then, investors started to focus on the future with the revolution of the microprocessor, which allowed Amazon to have the growth potential that Sears did not. In two decades, the lethal beauty of technology has put Amazon, which was only 20 percent higher than Sears in market cap then, at the top of the business world by granting it a place in the trillion-dollar market cap league. Sears is still struggling around a $71 million market cap.
• Basil M.K. Al-Ghalayini is the chairman and CEO of BMG Financial Group.
