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| 10 July, 2018

Saudi securities regulator awards first two fintech licences

Saudi Capital Market Authority approved licences allowing Manafa Capital and another firm, Scopeer, to offer crowdfunding investment services on a trial basis

Image used for illustrative purpose.
Close up of man using laptop indoors,

Image used for illustrative purpose. Close up of man using laptop indoors,

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DUBAI  - Saudi Arabia's securities regulator approved its first two financial technology licences on Tuesday, part of a drive to develop a fintech sector in the Arab world's biggest economy under reforms designed to reduce reliance on oil exports.

The Capital Market Authority approved licences allowing Riyadh-based start-up Manafa Capital and another firm, Scopeer, to offer crowdfunding investment services on a trial basis, the CMA said on Tuesday.

Individual investors will use electronic platforms operated by the companies to fund small and medium-sized enterprises in exchange for shares in those enterprises.

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The ventures could serve two aspects of Saudi Arabia's reform programme: broaden its capital markets, and create jobs by helping entrepreneurs obtain funding for new ventures. The CMA said it would receive applications for more fintech licences later this year.

The Saudi central bank has also thrown its weight behind fintech. In February, it signed a deal with U.S.-based Ripple to help banks in the kingdom settle payments using blockchain software.

Gulf Capital, an Abu Dhabi-based private equity firm, said in May that it had bought a stake in Geidea, the leading provider of electronic payment solutions in Saudi Arabia, in a deal worth over 1 billion riyals ($267 million).

(Reporting by Andrew Torchia Editing by Alexandra Hudson) ((andrew.torchia@thomsonreuters.com; +9715 6681 7277; Reuters Messaging: andrew.torchia.thomsonreuters.com@reuters.net))