Saudi Central BankSaudi Central BankNewsSAMA Exceeds Financial Sector Development Target on Electronic Payments in a head of its foreseen date 2020
SAMA Exceeds Financial Sector Development Target on Electronic Payments in a head of its foreseen date 2020
11/26/2019 12:00 AM

     The Saudi Arabian Monetary Authority (SAMA) revealed that the rate of electronic payments for the retail sector - Individual Retail Payments by the end of July 2019, amounted more than 36 percent of all payments available, including cash in the Kingdom, exceeding the target percentage of the financial sector development program - one of the programs of the Kingdom's Vision 2030. The program stipulates that the share of non-cash transactions should be increased by 28 percent by 2020.

      This achievement is based on SAMA's strategy for payment systems and the Financial Sector Development Program, which aims to enhance electronic payment and reduce cash handling to reach 70 percent of total payments in the Kingdom by 2030, for its many positive effects. These include providing customers with an excellent experience in facilitating payment processes, reducing cash transaction costs on the local economy, enhancing transparency in transactions, and direct impact on the efficiency of the national economy. The reduction of cash transactions is one of the most important strategic objectives that SAMA has been working on during the past period through the completion of several initiatives, projects and investments in the digital payments sector in line with the objectives of the financial sector development program.

        SAMA clarified that within the framework of the importance of monitoring and measuring the performance of the payment systems strategy, it recently conducted a detailed and comprehensive study to review and develop indicators to measure the percentage of e-payment transactions of the total payments in the Kingdom, and included payment methods currently used in the individual sectors in accordance with international practices, in addition to Government and business payments sectors.

       According to the study, results showed that the percentage of electronic payments of the retail sector - Retail Payments more than 36 percent by the end of July 2019 of the total available payments, including cash. E-payment methods were also varied, with the card payments making the largest share of approximately 31.3 percent, while other means varied between payments platform "SADAD", remittances and others.

      SAMA pointed out that the record growth rates witnessed in the electronic payments through the national payment system "Mada" is a result of Mada strategic plan. Mada recorded unprecedented spikes in the number and value of purchasing transactions in the past years. At the end of 2016, POS operations grew by 33%, while in 2017 and 2018, the growth rate was 35% and 46% respectively. The current figures for this year 2019 indicate that the growth rate was about 50 percent (until the end of last September).

SAMA pointed out that the growth indicators in the POS service were also accompanied by a noticeable expansion in the number of POS devices and their base of spread which included various commercial sectors (such as gas stations); the total number of devices exceeded more than 407 thousand devices by the end of September 2019 compared to 107 thousands devices by the end of 2013. In addition launching Mada Atheer (NFC) service has had a major impact in activating and enhancing e-payment, especially after the introduction of mobile payment services.

       These positive indicators were the result of SAMA's efforts to support the use of electronic channels, in cooperation with the local banking sector, with the participation of relevant private service providers, as well as the constant cooperation of SAMA with government entities to promote e-payment.

Enterprise Keywords