Saudi Arabia is considering reducing bank guarantee requirements for financial firms seeking licenses, aiming to strengthen its financial sector. The Saudi Central Bank has opened a public consultation on proposed changes to the Finance Companies Control Law, seeking feedback through the National Competitiveness Center’s platform.
The proposal suggests lowering the minimum bank guarantee to 20 percent of the required capital, a significant decrease from the current 100 percent. This adjustment is intended to free up liquidity for finance companies, allowing them to play a greater role in the nation’s economic growth.
Other proposed changes include clearer criteria for licensing new activities, emphasizing robust risk management, adequate financial resources, and strong governance. The draft also details circumstances under which licenses could be revoked, such as extended inactivity or breaches of regulations.
These reforms support Saudi Arabia’s Vision 2030, which prioritizes a dynamic financial sector. Initiatives like the Financial Sector Development Program and Fintech Saudi have helped position the Kingdom as a regional fintech leader, with the central bank driving innovation and regulatory progress.