The Persian Gulf countries are witnessing Saudi Arabia\u2019s strategic shift away from its traditional oil-based economy towards a new focus on financial technology (FinTech). In the last quarter of 2023, its economic growth rate was 1.5%, a deceleration from the preceding quarter. The expansion was primarily fueled by the non-oil sector, which saw a 2.6% jump, in contrast to the oil sector that experienced a decline of 2.1% due to reduced production.<\/p>\n

Overall GDP growth for Saudi Arabia in 2023 was approximately 2.3%, a slight increase from the 2.1% seen in 2022. Factors contributing to this growth include increased government expenditures and investments, as well as a resurgence in the nation\u2019s non-oil industries.<\/p>\n

Saudi Vision 2030<\/strong><\/p>\n

This strategic shift to FinTech is a central pillar of Saudi Arabia\u2019s Vision 2030 initiative. The Kingdom aims to leverage FinTech as a vehicle for economic diversification and to enhance financial inclusion, with a target of extending financial services to 80% of adults by the end of the decade. A noteworthy player in this burgeoning sector is AlJazira Bank, one of the emerging neobanks. Meanwhile, peer-to-peer (P2P) lending is gaining momentum, with the Saudi Arabian Monetary Authority (SAMA) projecting the P2P lending market to reach a valuation of $1.2 billion this year.<\/p>\n

The International Monetary Fund (IMF) anticipates moderate growth for Saudi Arabia over the medium term, primarily driven by the non-oil sector. Despite the potential for reduced GDP growth during the transition, Riyadh remains committed to transforming its economy. This commitment is evident in the growing contribution of the digital economy to the Kingdom\u2019s GDP, now accounting for 15%.<\/p>\n

In its 2023 Global Competitiveness Report, the World Economic Forum (WEF) ranked Saudi Arabia 17th out of 64 countries in global competitiveness, underscoring the nation\u2019s significant progress.<\/p>\n

Digital Infrastructure Fuels Saudi Arabia\u2019s FinTech Push<\/strong><\/p>\n