The Saudi Arabian Monetary Authority (SAMA) has announced in a press release today that it has used blockchain technology to deposit part of the liquidity that SAMA had previously announced, to be injected into the banking sector. This is part of SAMA’s actions aimed at enhancing the sector’s capabilities to continue its role in providing credit facilities. SAMA was set to inject $13.333 billion in the banking system to enhance the liquidity in the sector as per Saudi Central Bank.
According to the press release this action comes as a part of SAMA’s continues efforts in exploring and experimenting emerging technologies and keeping lead pace with the global trends of central banks in assessing the impacts of such technologies on the financial sector.
SAMA is one of the pioneer central banks to experiment blockchain technology for money transfers, this move was one of the key innovative initiatives launched by SAMA in its program to enable and develop Fintech in the Kingdom. This include among others: The Fintech Saudi Initiative in cooperation with the Capital Market Authority, the introduction of SAMA Regulatory Sandbox, and an array of digital banking services and payments.
This is not the first time SAMA utilizes blockchain, in 2018 it signed an agreement with Ripple to utilize its platform along with several other Saudi Banks. Then in 2019 SAMA launched the digital currecy ABER project with UAE, utilizing IBM blockchain solutions. To date the ABER project has yet to be launched.
Finally SAMA has also been a strong proponent of fintech innovation in the KSA with its regulatory sandbox that has included Blockchain startups.