Saudi Arabia’s National Debt Management Center (NDMC) has concluded a financing arrangement worth €1 billion with the Italian insurance-financial group SACE.
The deal is part of a broader initiative to strengthen trade and investment relations between Saudi Arabia and Italy. The kingdom is seeking to benefit from all available financing resources for government projects as part of its Vision 2030 strategy.
Notably, the financing was made through several international banks and aims to finance Saudi Vision 2030’s development and infrastructure projects. Moreover, it is Saudi Arabia’s third financing of its kind following other financing from financial institutions through other export credit agencies.
SAMA’s new rules
In related news, the Central Bank of Saudi Arabia (SAMA) issued new rules regulating buy now, pay later companies (BNPL). The move is part of its efforts to develop the finance sector in general and empower the fintech industry in particular.
The Central Bank of Saudi Arabia’s new rules define BNPL activity as financing that allows consumers to purchase goods or services without a term cost payable by the consumer.
Provisions and obligations
The new rules stipulate several provisions and obligations, the most important of which are:
- Licensing requirements
- Internal policies and procedures regulations
- Information security standards and measures to combat financial crimes
- Requirements designed to safeguard consumers
- Boundaries for activities and credit
- Regulations on supervision and compliance
SAMA had previously presented draft rules for regulating BNPL companies seeking the public and specialists’ opinions to enhance transparency and participation. The Saudi central bank then studied the opinions and views and took them into account in the rules’ final versions.
Read: SAR262.7 billion credit facility extended to SMEs in Saudi Arabia
Increased profits for Saudi banks
Earlier, SAMA issued its monthly bulletin for September 2023 on banks’ liabilities from the government public sector. The bulletin also included bank profits in Saudi Arabia and net foreign assets. Notably, banks in Saudi Arabia recorded profits worth SAR7.1 billion during September, a 22.4 percent increase.
The monthly bulletin revealed that the profits of banks operating in Saudi Arabia before zakat and taxes increased by the end of September 2023. That is compared to their profits in September 2022, which recorded SAR5.838 billion. That is a SAR518 million increase (7.8 percent), compared to its profits in August 2023, which recorded SAR6.625 billion.
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