As the cost of cash is high, countries around the world are starting to go cashless because it’s safer, faster and more efficient. Saudi Arabia has set a target to achieve 70% of non-cash transactions by 2030 and an interim goal of 28% by the end of 2020 under the Financial Sector Development Program (FSDP). The plan is a part of Saudi Vision 2030 to reform and diversify its economy away from oil dependency and establish a vibrant country for people to live.
Three Pillars Towards a Cashless Society
There are three key pillars for a cashless economy to truly take hold in the Kingdom. First is a digitally enabled and financially literate population that understands how to utilize digital payment solutions to start moving the needle towards a cashless economy. The second pillar is a digitally-enabled payment infrastructure that should be built under a collaboration between government and other related stakeholders, once citizens begin to make cashless transactions. Lastly, is entrepreneurial fintech ecosystems, comprising digitally innovative banks and a strong start-up culture with accelerators and venture capitalists funding, to further fuel the adoption of cashless transaction methods in Saudi Arabia.
Opportunities to Drive Fintech Forward
There is no denying that Saudi Arabia is moving aggressively towards a Cashless Economy by 2030. The report highlighted that Saudi Arabia is a potential market for fintech players who are looking for a new market with high demand and supportive government regulations. First-moves have been made by several top players, proving that fintech players should take advantage and drive the Kingdom’s digital economy.