KSA market
The Definitive Guide to Entering the KSA Market
The tech landscape in KSA has seen a significant change in recent years which can be seen in the
initiatives taken by the Saudi government that have contributed to KSA becoming a hotbed for businesses. Vision 2030 is one such initiative that has brought with it an array of opportunities and a plan to transform the social, economic and tech landscape of Saudi Arabia. The Saudi government plans to increase its GDP contribution of small businesses from 20% to 35%.
Another change in the entrepreneurial sector is the huge number of female tech entrepreneurs emerging in the country. The Saudi government issued a total of 65,912 new commercial licenses to women in 2015, which increased to 139,754 licenses in 2021, making KSA’s average rate of participation even higher than Europe’s!
One of the Saudi government’s initiatives to facilitate tech startups is Biban which has revolutionised the sector by creating an ecosystem of international and local entrepreneurs and giving them a platform to share ideas, converge on different topics and form partnerships.
Navigating the KSA market can also prove to be threatening, especially for businesses that are expanding or entering KSA from other countries. Saudi government only recognises some regulations and rejects those that are predominant in other countries. This creates hurdles for entrepreneurs from countries following their native regulations.
Another challenge is the Saudi government’s strict rules about branding and marketing, all newcomers must take care of the cultural preferences and socially accepted norms of KSA. Another weakness of the Saudi market is the Saudization of the market, which is the preference of many companies and firms to hire Saudi nationals only when recruiting for roles. While these challenges may seem daunting to the newcomers
Dastak: Your Partner for a Seamless Business Expansion!
Dastak is thrilled to play a role in this ecosystem by working with partner firms like you and helping your business enter and expand into the Saudi market. Our MAP (Market Access Program) caters specifically to startups and businesses looking to scale their business in KSA. From a comprehensive research report into the market players, competitors and trends to a study of your product and its feasibility in the market, we offer a complete package. With our pre-landing, landing and post-landing guidance, we make sure that your success in the market is guaranteed!
To understand the market completely, a general overview of the fintech ecosystem in Saudi Arabia can be explained with the five pillars of the ecosystem:
All businesses starting their operations in KSA have to follow some very stringent regulations which include regulatory authorities such as Monsh’aat, SAMA and in some cases CITC. Monsh’aat, KSA’s SME regulatory authority, requires businesses to obtain a certificate of startup size and a business incubator license to start their operations in KSA. SAMA is an authority that oversees all financial activities conducted in KSA such as setting up sandbox programmes, payment processing gateways and open-banking policies.
The Saudi government has taken initiatives to bridge the talent gap that exists in the industry. One of these initiatives is the Saudi government’s Fintech Summer Sessions by Fintech Saudi. This is a 10-week online summer training tailored to individuals interested in the Fintech sector who want to improve their knowledge base and awareness of the latest trends in the Fintech industry. Another initiative taken in this regard is the alignment of KAUST with the Vision 2030 goals, especially on the front of sustainability and environment-friendly initiatives. This ensures a production of talent that contributes to the enhancement of the financial and technological landscape of KSA.
Tech Startups establishing operations in Saudi Arabia can leverage many opportunities available in KSA, especially KSA’s annual investment platform which offers numerous capital-raising options for SMEs. The “Rowad Package”, an initiative launched by the Saudi Data and Artificial Intelligence Authority “SDAIA” in cooperation with “Monsha’at” and Elm Company, is another opportunity for securing SME funding.
The fintech industry in Saudi Arabia has seen an acceleration in VC funding in recent years. Factors that have led to this acceleration are the Saudi Venture Capital Company’s (SVC) announcement of the launch of the “Investment in Fintech VC Funds” product. This initiative taken at the Financial Sector Conference 2023 was in partnership with the Capital Market Authority (CMA) and the Financial Sector Development Program (FSDP). This led to an allocation of SAR300 million from the investment portfolio for this product.
The demand for a thriving tech ecosystem in KSA is imminent now due to the change in the Saudi government’s priority change. From an economy that previously relied heavily on revenue driven by fuel, KSA is now transforming its economy into one driven by technological advancement and financial inclusion.
The Saudi government has taken initiatives to enhance the tech, digital and financial infrastructure of the region. This can be seen by the formation of the Saudi Company for Artificial Intelligence (SCAI) which aims to innovate the technological infrastructure of the country. STC is one such company which has partnered with SCAI and ‘data robots’, which will ensure the formation of an AI development hub and research centre in KSA. Fintech companies are investing heavily in robust cyber security measures and data protection laws such as PDLP (est. 2021). Digital payment systems are evolving rapidly with the inclusion of Mobile payment apps, QR code-based transactions, and contactless payment methods. Payment companies like Paytabs and Madapay are contributing to a cashless society.
