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13-04-23

Saudi Arabia's Push Toward a Cashless Economy Shows Progress

(MENAFN) Saudi Arabia's move toward a cashless economy has gained momentum as the retail sector surpassed the 60 percent target set by the Financial Sector Development Program (FSDP). The latest data from the Saudi Central Bank, also known as SAMA, revealed that e-payments accounted for 62 percent of aggregate payments in the Kingdom's retail sector last year, including cash. This achievement is attributed to Saudi Arabia's ongoing support and enablement of the financial sector over the past couple of years, as reported by the Saudi Press Agency.

One of the key objectives of the FSDP is to promote electronic payments and convert Saudi society to a cashless society by increasing the share of non-cash transactions from 16 percent in 2016 to 60 percent by 2022 and a further 70 percent by 2030. The FSDP aims to develop a diversified and effective financial sector that supports the development of Saudi Arabia's economy, diversifies its sources of income, and stimulates savings, finances, and investments, according to its website.

The Kingdom's notable enhancement in payment infrastructure, improvement of current systems, and introduction of new systems and services have propelled it toward its Vision 2030 goals. Furthermore, Saudi Arabia has boosted electronic payments further by advancing the financial sector's regulatory, technical, and operational outlooks.

According to the agency, e-commerce sales through Mada, the Saudi Payment Network, rose by 40 percent last year compared to 2021. In 2022, the number of point-of-sale transactions through Mada reached an impressive 7.2 billion transactions. As for online transactions through the Mada card, they reached 610 million transactions in 2022, witnessing a 76 percent growth. Last year, the Kingdom's POS transactions processed through 1.4 million POS devices, showing a growth of 42 percent year-on-year.

Reducing cash transactions is one of SAMA's most important strategic objectives as a stakeholder in the FSDP. To achieve this, SAMA has been working hard over the past few years on several initiatives, projects, and investments in the digital payments sector in line with the objectives of FSDP. The success of SAMA's strategy to convert Saudi Arabia to a cashless society is evidenced by the achievements made in electronic payments.
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