Saudi Central Bank (SAMA) announced that the Kingdom is striving to establish a low-cost digital central bank that simulates digital operations on the occasion of the cabinet's decision to approve the payments and its services law.
SAMA governor Fahad al-Mubarak noted that the approval underscores the leadership's keenness to support the development of the financial sector and maintain fairness and stability of transactions.
The provisions of the law will enable SAMA to exercise its supervisory oversight of the payments sector in Saudi Arabia, following the international best practices and compliance standards.
Mubarak pointed out that the law seeks to enhance the integrity and adequacy of the payment systems' infrastructure and services in the Kingdom by upgrading the regulatory and supervisory frameworks.
He added that the law would foster payment systems' safety and efficiency to serve local customers and create attractive investment opportunities in line with Vision 2030.
Addressing a session at the Future Investment Initiative (FII), Mubarak said that the Kingdom is striving to establish a low-cost digital central bank that simulates digital operations, which would hedge against the real liquidity maintained in central banks.
"The Kingdom has a cross-digital currency project with the UAE, and there is a large project for financial technology in Saudi Arabia," he pointed out.
He warned that current digital currencies are dangerous in their suspicious transactions as there is no guarantee.
"There is a unified currency for the clearing system between banks in the region, and in the Gulf region, there is a currency exchange policy that is very similar to digital transactions and depends a lot on the dollar."
He stressed that digital currencies will be within the banking system, adding that Saudi Arabia "has experience with other partners in digital currencies for central banks."