The Saudi cabinet has granted a digital bank license to STC Pay, a digital payments company which is a fully owned subsidiary of Saudi Telecom. STC Pay will be converted into a local digital bank, with a capital of SAR 2.5 billion.

According to Reuters, “the company will inject additional 802 million riyals to retain 85% of STC Pay’s share capital, with Western Union investing 750 million riyals for the remaining 15%”.

Additionally, a second digital bank license was granted to a consortium of companies and investors led by Abdul Rahman bin Saad Al-Rashed and sons Company, to establish a local digital bank with a capital of SAR 1.5 billion.

The Saudi Central Bank (SAMA) will recommence its work to finalise technical and operational requirements for the two banks to start their banking activities in the Kingdom.

SAMA has licensed 16 Saudi fintech companies in the recent past to provide payment services, consumer micro-finance and digital insurance brokerage.

In addition, there are 32 fintech companies operating under the regulatory sandbox, which was designed for testing innovative services and products in the Kingdom.

Featured image: screengrab from STC PAy