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Saudi Arabia Takes Banking Industry Leap by Approving Digital Banks

Saudi Arabia approves issuing licenses to two digital banks (Asharq Al-Awsat)
Saudi Arabia approves issuing licenses to two digital banks (Asharq Al-Awsat)
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Saudi Arabia Takes Banking Industry Leap by Approving Digital Banks

Saudi Arabia approves issuing licenses to two digital banks (Asharq Al-Awsat)
Saudi Arabia approves issuing licenses to two digital banks (Asharq Al-Awsat)

Keeping up with aspirations for developing the Saudi finance sector, the Saudi Cabinet gave the Kingdom's finance minister the green light to issue licenses for the country's first digital banks.

On Tuesday, in a virtual meeting chaired by King Salman, the Cabinet approved the finance minister issuing the necessary licenses for STC Bank and Saudi Digital Bank, both under establishment.

First, STC Pay will be converted into a local digital bank, STC Bank, with a capital of SAR2.5 billion ($666 million). Second, several companies and investors will establish a local digital bank, Saudi Digital Bank, to conduct banking business in the Kingdom, with a capital of SAR1.5 billion ($400 million).

The state economy and the public and private sectors benefit from digital banks' presence, specialists confirmed to Asharq Al-Awsat.

Today, Saudi Arabia is preparing for the future by evolving its financial sector through supporting drafting and passing required legislation and developing the desired digital and technical infrastructure.

Finance Minister Mohammed Al-Jadaan said that the Cabinet's approval is in line with the Saudi Financial Development Program (SFDP), which is part of the Kingdom's massive economic reform plan known as Saudi Vision 2030.

These objectives seek to develop a more efficient digital infrastructure while encouraging entrepreneurship and creating job opportunities in the financial sector, he said.

Moreover, the finance minister pointed out that the SFDP has worked on mapping a strategy for the whole financial sector from 2021 to 2025.

This strategy includes many initiatives related to financial technology that grow the national economy and diversify sources of income.

Saudi Arabia's Vision 2030 goals include developing the digital economy and enabling financial companies to support the growth of the private sector.

Last year, the Saudi Central Bank (SAMA) licensed 16 financial technology companies to provide payment services, consumer microfinance, and electronic insurance brokerage.

For his part, SAMA Governor Fahad bin Abdullah Al-Mubarak clarified that with the Cabinet's approval, SAMA would recommence its work to finalize technical and operational requirements for both STC Bank and the Saudi Digital Bank.

This will allow both establishments to kickstart their banking activities in the Kingdom.

The governor also drew attention to the fact that digital banks are subject to supervision and controls applied currently to commercial banks operating in the Kingdom, but with an increased focus on technology, cybersecurity, anti-money laundering measures, and tracking terrorist financing as operational risks.

Al-Mubarak pointed out that digital banks provide services and products exclusively through e-channels and adopt an innovative and sustainable banking business model that enhances financial inclusion and keeps pace with cutting-edge tech developments in the financial sector.

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Business

Oil Prices Fall on Easing Fears Over Saudi Supply Disruption

FILE PHOTO: Vessels near the Strait of Hormuz, as seen from Musandam, Oman, September 2, 2026. REUTERS/Stringer/File Photo
FILE PHOTO: Vessels near the Strait of Hormuz, as seen from Musandam, Oman, September 2, 2026. REUTERS/Stringer/File Photo
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Oil Prices Fall on Easing Fears Over Saudi Supply Disruption

FILE PHOTO: Vessels near the Strait of Hormuz, as seen from Musandam, Oman, September 2, 2026. REUTERS/Stringer/File Photo
FILE PHOTO: Vessels near the Strait of Hormuz, as seen from Musandam, Oman, September 2, 2026. REUTERS/Stringer/File Photo

Oil prices fell 2% on Friday, extending losses for a third straight session as easing concerns over Saudi supply disruptions outweighed anxiety about a widening of conflict across the Middle East.

Brent crude futures fell by $2.14, or 2%, to $102.68 a barrel by 0806 GMT. US West Texas Intermediate futures fell $1.83, or 1.8%, to $100.08, Reuters reported.

Benchmark Brent prices are on track for their first weekly loss in three.

Prices climbed to close to four-month highs earlier in the week after sources said crude loadings ⁠at Saudi Arabia's Red Sea export hub of Yanbu had been suspended and Riyadh cancelled some deliveries to Europe after its East-West pipeline was damaged in an attack last week.

However, prices have cooled since on reports that Saudi Arabia was seeking to restore about half the capacity of its East-West oil pipeline within days.

Saudi Arabia has sold about 60 million barrels of crude from its Gulf port of Ras Tanura inside the Strait of Hormuz for loading via ship-to-ship transfer at the Omani port of Sohar this month and next, multiple trade sources said on Friday.

The rebound in Saudi Aramco's exports from inside the Gulf to between 1 million to 1.5 million barrels per day on average, similar to or slightly higher than August's levels, has cooled global oil prices as it could make up for some of the ⁠volume lost at its port of Yanbu.

Chinese and South Korean refiners are among the top buyers of the spot supplies, while some volumes will be going to India and Japan, said the sources, who spoke on condition of anonymity.

"Recent efforts ‌to restore Saudi export capacity have reduced some of the immediate supply ‌anxiety," said Priyanka Sachdeva, head of market insights at Phillip Nova.

Business

ECB's Lagarde Keeps Door Open to Early Exit

European Central Bank (ECB) President Christine Lagarde addresses a press conference after a meeting of the Governing Council of the European Central Bank (ECB) in Berlin on September 10, 2026. (Photo by John MACDOUGALL / AFP)
European Central Bank (ECB) President Christine Lagarde addresses a press conference after a meeting of the Governing Council of the European Central Bank (ECB) in Berlin on September 10, 2026. (Photo by John MACDOUGALL / AFP)
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ECB's Lagarde Keeps Door Open to Early Exit

European Central Bank (ECB) President Christine Lagarde addresses a press conference after a meeting of the Governing Council of the European Central Bank (ECB) in Berlin on September 10, 2026. (Photo by John MACDOUGALL / AFP)
European Central Bank (ECB) President Christine Lagarde addresses a press conference after a meeting of the Governing Council of the European Central Bank (ECB) in Berlin on September 10, 2026. (Photo by John MACDOUGALL / AFP)

European Central Bank President Christine Lagarde on Friday kept the door open to leaving her post early, replying "we'll see" when asked if she would remain in the position until her term ends ‌in October 2027.

"I ‌leave in ‌2027," ⁠Lagarde told Irish ⁠national broadcaster RTE in response to a question on rumors of her early resignation that have persisted for most ⁠of this year.

When asked ‌if ‌that meant October 2027, ‌Lagarde replied: "We'll see."

"What I ‌can tell you at this point is that whatever the time, it will be ‌handled in the most professional way as ⁠it should ⁠be," she added.

Sources told Reuters this week that France would back Dutchman Klaas Knot to succeed Lagarde as part of a bargain in which a French candidate would be picked for chief economist.

Business

5 Countries Want Smaller Growth of Next EU Budget, Spain Offers Ideas

FILE PHOTO: European Union flags flutter outside the European Commission headquarters in Brussels, Belgium April 29, 2026. REUTERS/Yves Herman/File Photo
FILE PHOTO: European Union flags flutter outside the European Commission headquarters in Brussels, Belgium April 29, 2026. REUTERS/Yves Herman/File Photo
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5 Countries Want Smaller Growth of Next EU Budget, Spain Offers Ideas

FILE PHOTO: European Union flags flutter outside the European Commission headquarters in Brussels, Belgium April 29, 2026. REUTERS/Yves Herman/File Photo
FILE PHOTO: European Union flags flutter outside the European Commission headquarters in Brussels, Belgium April 29, 2026. REUTERS/Yves Herman/File Photo

Germany, Denmark, Finland, the Netherlands and Austria said on Friday the European Union's budget for 2028-2034 must be "several hundred billion euros" smaller than the €2 trillion proposed by the European Commission, drawing battle lines before EU budget talks come to a head in the next three months.

The leaders of the five countries, among the biggest net contributors to the budget, wrote in a joint op-ed in Politico that EU taxpayers ⁠cannot keep paying ⁠more to pay for both old and new priorities.

"It (the budget) is too focused on subsidies and transfers allocated largely in advance, leaving too little room for what Europe urgently needs: common investment in security and defense, competitiveness, innovation, and the fight against irregular migration," the five leaders said.

Net beneficiaries of the EU budget are concerned that ⁠would reduce EU funds for farmers and for equalizing standards of living between the poorer and richer regions of Europe -- a major political concern before parliamentary elections next year in France, Italy, Spain, Poland, Greece, Finland, Slovakia and Estonia.

The European Commission has proposed the budget should amount to €2 trillion or 1.26% of EU Gross National Income (GNI), of which some 168 billion, or 0.11% of GNI, is to service the EU's borrowing for the post-pandemic recovery fund. The five leaders called the proposed nominal increase of around 60% over the 2021-2027 budget "simply not ⁠realistic."

"This is ⁠why we call for a balanced cut to the Commission’s proposal of several hundred billion euros," Reuters quoted them as saying.

To help find a solution, Spain proposed to change the repayment schedule of part of the EU post-pandemic borrowing, linking it to economic growth and spreading it out over a longer period. This, according to Spanish Economy Minister Carlos Cuerpo, would free up some €70 billion.

"An annual payment of about 0.06% of EU GDP would retire the debt by 2058, the deadline agreed by member states," Cuerpo said.

EU governments will discuss the next EU budget at summits in October, November and December in an effort to get a deal before the end of the year.