SAMA Chief: Digital Central Bank in pipeline

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RIYADH — Saudi Central Bank (SAMA) Governor Dr. Fahd Al-Mubarak said that the Kingdom is striving to establish a low-cost digital central bank that simulates digital operations, which would have a hedge against the real liquidity maintained in central banks.

Addressing the session of the Future Investment Initiative here Tuesday, he said that some countries have started experimenting with these systems. “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.

Al-Mubarak said that the current digital currencies are dangerous in their suspicious transactions as there is no guarantor for them.

“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. We have experience with other partners in digital currencies for central banks,” he said while stressing that digital currencies will be within the banking system.

SAMA chief said that the Kingdom now has about 32 financial technology companies operating in different sectors, whether financial payments, insurance or other activities.

“We have an open banking program. The government initiatives and stimulus programs have contributed to alleviating the impact of the coronavirus pandemic,” he said while specially citing those initiatives and programs meant for the small and medium enterprises.

Dr. Al-Mubarak stressed that the Saudi government initiatives and stimulus programs have contributed to mitigating the impact of the coronavirus pandemic, especially those within the scope of the small and medium enterprises (SMEs).

He was addressing a session titled “Banking on the Future: the Outlook for Financial Institutions in the GCC and Beyond” in Riyadh Tuesday.

Dr. Al-Mubarak said that SAMA launched several programs to support enterprises that fall within the scope of the small and medium enterprises and ceased operation and suspended business activity.

Participants in the session pointed out that the leaderships of Saudi Arabia and the United Arab Emirates are very interested in investment and economic issues and banking sectors, and providing everything that is suitable for investors, stressing that technology widely draws the future of investment.

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