Inside Saudi Arabia’s Digital Banking Revolution

Saudi Arabia is entering a transformative phase in its financial ecosystem, driven by innovation, regulation, and collaboration between legacy banks and digital-first challengers. In this episode, Brett King sits down with Dr. Antoine Khadige, Senior Partner at Strategy+ GCC, and Mohamed AlSabea, Chief of Staff and Chief Strategy Officer at barq, to unpack how Vision 2030 is shaping the future of digital banking, fintech innovation, and financial inclusion across the Kingdom.

From infrastructure modernization to the rise of AI-driven payment ecosystems, the conversation highlights how regulatory clarity, ecosystem partnerships, and localized innovation are propelling Saudi Arabia to become a regional fintech powerhouse, bridging traditional finance with emerging digital models.

What’s Driving Saudi Arabia’s Digital Banking Transformation?

HOST (Brett King): What’s been the biggest catalyst for digital banking growth in Saudi Arabia recently?

Dr. Antoine Khadige: The transformation we’re seeing is both structural and cultural. Vision 2030 established clear national objectives, digitization, financial inclusion, and diversification away from oil. The Saudi Central Bank (SAMA) has played a pivotal role by issuing licenses for new digital-only banks and opening the door to fintech startups through its regulatory sandbox.

GUEST (Mohamed AlSabea): Consumers have evolved too. They’re digital natives who expect real-time services, and that’s forced banks to modernize their operating models. What we’re seeing now is a blended landscape where traditional financial institutions and fintech disruptors collaborate to deliver seamless digital experiences.

Key Highlights:

• Vision 2030 catalyzed a systemic shift toward digital-first financial services.
  
• SAMA’s proactive licensing strategy fostered competition and innovation.
  
• Consumer expectations are reshaping product design and delivery.
  

How Fintech Collaboration Is Redefining the Ecosystem

HOST: Collaboration seems to be a recurring theme. Why is partnership such a central driver of Saudi fintech’s success?

Dr. Khadige: In emerging markets, infrastructure and trust are critical. Partnerships between established banks and startups create both stability and speed. For instance, we’re seeing API-led banking models where fintechs plug directly into banks’ systems to offer specialized services, like micro-lending, instant remittances, and AI-driven credit scoring.

GUEST (AlSabea): Exactly. The key is interoperability. Our mission at barq is to build ecosystems that connect legacy systems with next-generation fintech tools, ensuring customers experience convenience and security without friction.

QUOTE: “Innovation isn’t about disruption, it’s about integration. The most successful ecosystems are the ones that scale trust as much as technology.” — Dr. Antoine Khadige

Key Points:

• Fintechs serve as innovation accelerators for incumbents.
  
• Open banking and API-driven integrations are reshaping financial access.
  
• Ecosystem collaboration fosters sustainable innovation rather than zero-sum disruption.
  

What Role Does AI and Data Play in the Next Stage of Digital Banking?

HOST: How is artificial intelligence changing the customer experience and back-end operations in Saudi financial institutions?

Dr. Khadige: AI is the invisible infrastructure of modern finance. From fraud prevention to personalized product recommendations, data intelligence allows banks to move from reactive to predictive service models.

GUEST (AlSabea): At barq, we’re using machine learning not just to enhance customer experience but to make credit and underwriting processes more equitable. AI democratizes access by allowing nontraditional data to inform financial decisions, extending credit to previously underserved segments.

Key Insights:

• AI enhances both customer personalization and risk management.
  
• Data integration creates adaptive banking models responsive to behavior and context.
  
• Emerging fintechs in Saudi Arabia are leveraging AI for inclusive finance and micro-entrepreneur empowerment.
  

How Regulation and Trust Fuel Long-Term Growth

HOST: Regulation is often viewed as a hurdle, but in Saudi Arabia, it seems to be an enabler. Why is that?

Dr. Khadige: SAMA’s regulatory sandbox is a perfect example of progressive oversight, it lets innovators experiment safely while maintaining systemic integrity. This balance of freedom and control encourages responsible disruption.

GUEST (AlSabea): Regulation builds trust. Saudi consumers are cautious with their finances, so frameworks that ensure data privacy, cybersecurity, and ethical AI use are essential to adoption.

QUOTE: “In a trust-based economy, regulation isn’t a constraint, it’s a catalyst for innovation.” — Mohamed AlSabea

Highlights:

• Saudi regulation encourages experimentation within structured guidelines.
  
• Trust and transparency drive digital adoption rates.
  
• Compliance with international standards ensures global fintech alignment.
  

The Future: From Local Innovation to Global Influence

HOST: What does the next decade of Saudi digital banking look like?

Dr. Khadige: Expect regional expansion. Saudi fintechs are already influencing MENA markets through cross-border partnerships and digital trade facilitation. The Kingdom’s investment in AI, cloud banking, and real-time payments will redefine the competitive edge.

GUEST (AlSabea): I see a future where Saudi Arabia becomes the benchmark for integrated digital banking ecosystems. The groundwork we’re laying today will influence how fintech innovation scales across emerging markets globally.

QUOTE: “Saudi Arabia isn’t just catching up, it’s creating the blueprint for digital finance in the Middle East.” — Brett King

Key Forecasts:

• Expansion beyond national borders into the wider GCC and MENA region.
  
• Increased public-private partnerships around AI, sustainability, and inclusion.
  
• Potential for Saudi-led fintech frameworks to guide international innovation policy.
  

Memorable Quotes

1. “Innovation isn’t about disruption, it’s about integration.” — Dr. Antoine Khadige
   
2. “AI is the invisible infrastructure of modern finance.” — Dr. Antoine Khadige
   
3. “Regulation is a catalyst for innovation, not a constraint.” — Mohamed AlSabea
   
4. “Saudi Arabia is creating the blueprint for digital finance in the Middle East.” — Brett King

Raw Transcript:

Vision 2030 is one part of the story, but it’s more about the ability to create value in untapped territories, and the best is yet to come. There is an acknowledgement that the GCC is today a fintech hub. That was not the case five to ten years ago.

Welcome to Breaking Banks. I’m your host, Brent King, and we are in the spot, in the money pot here in Riyadh at Money2020. I have my good friends Antoine and Mohamed with me.

Antoine, you are senior partner at Strategy&, heading up the banking and finance competency here in the region. You’re based here in Riyadh, right? I’m based in Riyadh, actually. That’s the hub today.

I’m asking you to sort of help us out with hosting duties here today as we interview Mohamed El-Sabih, who’s the chief of staff of BRAC, VIP, and Strategy. And, of course, why we’re here to talk about BRAC in Riyadh is, in full disclosure, I’m an advisor to the board, but also it is the fastest growing private wallet in the world right now, the fastest growing digital bank in the world. We just heard the news that this week, BRAC has surpassed 8 million users in just a smidge over a year of operation, which is just phenomenal progress.

That’s more than 10% of the Saudi population already, right? It’s 20% of the adult population. That’s about almost 50% of the bankable population in Saudi. That’s incredible.

That’s incredible. And, you know, this has all been done from here in Riyadh, here in Saudi. Absolutely.

Born in KSA. Born in KSA. So maybe, Antoine, first of all, what makes the GCC in general a really important fintech hub these days? Because we see a lot of traction, a lot of action coming.

We just heard the announcement just last week that Revolut has got their banking license in the UAE. We know that we should hear about Nubank very soon in the same way. You know, given that the UAE is a fairly small market, Saudi is a bigger market, but, you know, what makes this market in particular such a magnet for fintech right now? First, thanks, Brett.

Excited to be here today to talk about Bark. I think the right question to ask about Bark is, how big is it before the podcast and after the podcast? I think today the velocity of growth has just been amazing. And I’m very happy to host Mohamed today to tell us a lot about the secret sauce for getting it done.

Now, fast forward to where we are today in the GCC. I think the way you started your question is quite important. There is an acknowledgement that the GCC is today a fintech hub.

That was not the case five, ten years ago. I remember the days where we used to define strategies about how can the GCC become a fintech hub? How can Saudi Arabia attract fintechs? Today, I think by all metrics, it is a fintech hub. People are lining up.

As we speak, 21 plus international companies are queuing to get licenses here. So now the question is why? What we’ve seen is, I would say, three things that have created this gravity around the region. One is the population itself.

The population is, yes, young, 70 percent below the age of 35. But more importantly, the population is tech-savvy. Yeah, well, mobile penetration in both of the markets I mentioned is well over 100 percent, which means most people have at least two smartphones, which is extraordinary.

It’s extraordinary. And the pace at which digital penetration is happening across sectors, I think, is really unprecedented. So that, I would say, is the first factor.

The second factor, which is equally important, the region has managed to build a digital infrastructure that is so conducive for fintechs and for users to interact. So today, when we look at Saudi, when we look at the UAE, you could see that you have one of the best instant payment trails in the world. You have a domestic card scheme that penetrates 80 percent of the population today.

You have an instant EKYC that allows you, literally, to open a bank account in less than a minute. So basically, what the government… This is digital identity infrastructure, right? And that’s true of KSA and UAE. In fact, I would say, I mean, we have this debate offshore in Europe about civil rights for digital identity and things like that.

But how can you have a services layer without digital identity? It’s sort of foundational, right? And I think building that foundation was key to unlocking the fintech and the digital economy at large. The third one, which, I mean, has really changed the game, is the regulation. Traditionally, the region was known as being skeptical of innovation, focusing on stability versus change.

This has really transformed in the last five, six years. And it has transformed in two ways. The regulators themselves have pushed the boundaries, starting with the fintech sandbox, then pushing to the new regulations on PSP, on open finance, and what have you.

But more importantly, there is an inherent trust in the public with the regulator. So the moment you’ve got a company that is regulated by the central bank, it makes that company much more addressable by the population. They want to try it.

They want to check it out because they trust the regulator has done a great job in making sure that that company can be entitled to own and to manage and transact their money. I think that’s a very important point in the region and specifically to Saudi Arabia and the UAE. Very interesting.

So for those that aren’t familiar with the terminology, those listening in the States or in other parts of the world, when we refer to GCC, we’re talking about the Gulf Cooperation Council region. And that’s sort of the official region of all the Middle East MENA countries in this part of the world. All right.

So, Mohamed, let’s dive in a little bit to the Barak origin story. You’re 12 months in, but we have seen this flurry of activity. We see so many homegrown fintechs here.

We have the Sukuk, we have Tabi, all these new players coming into the market. There’s a flurry of activity. But how did Barak get started? What was the origin of the idea and why was now the right time? First of all, thanks for having me, Britt.

Thank you, Antoine, for being here. Barak came to life by a vision of a handful of people who believed that the market was ready for disruption once again, the fintech market in Saudi. The team that have built Barak is the same team that is behind the biggest success stories in fintech in Saudi and have been able to, I would say, be pioneers in that field.

Having come from their success stories and moving on to another entity, the idea was not to be a copycat. The idea was to learn all of the other mistakes that we’ve done and the market has done and do it much better, much faster, and much cheaper. Card is a card.

Remittance is a remittance if you just look at the product. This group of people have grown from 10 or 9 in 1st of January 2023 to now a family of over 200 employees. This is a growth that was fueled by people who believed in the vision.

They’ve joined and left their jobs because they believe this is the right team that has the right mix of sauce. I use this terminology, the secret sauce, because we have the right team that have to come together. I call ourselves a cult because we’re very tight, we work together, we fight, we cry, we hug, and hopefully we’ll get there.

Hugs and kisses all the way. There is no that can destroy this gel that the team has. The second is the technology.

We knew that relying on third parties for tech is not the way to go forward. We knew that you need to own your own technology. So from the get-go we invested heavily in that and made sure that we own our technology.

We in fact own pretty much everything except our sanctions, AML systems, and our telephony systems. But that’s, I mean, that in itself is fairly unique in this region. I mean, you know, building your own platform in this sort of day and age when you have all of these amazing, you know, platforms that you could bring to bear, that’s a pretty big commitment and a pretty big decision to make.

Well, this is why it’s paid off today. I’ll give you a small example. In one of our previous roles with the team, the regulator asked for a specific change which required a coding to be done in core banking.

That core banking system was provided by a third party. You had to send a request for them to give you a change request pricing and then tell you when they can make the team available on the ground to help you doing that code. Because you’ve got a data hosting regulation here that everything has to be hosted in prem.

That does not work for Fintech. Fintech needs to be able to move fast and move quick. And this is what we’ve done.

We moved fast, we moved quick, we went to market on end of July, first of August 2024. And since then, we’ve been growing. This growth is beyond our wildest projections.

I believe 21 days, 1 million users, everything is put to test. So if this in-house built technology was not resilient enough, it would have crashed and burned. And this is, I think, one of our key strengths in addition to the right products.

How would you describe that technical architecture? Because it’s not a traditional core banking system. It’s obviously much more agile than that. So you know, what does that look like? If you’re trying to explain how different your technology architecture is to a typical bank in Saudi Arabia, how would you describe the differences? I would not share everything.

I would tell you that it is a microservices-based architecture. It is decoupled. Each and every component has been designed in a way that is easier to tweak, easier to decouple from the entire architecture.

But core banking, to your question, is a very simple ledger. If you just want to talk basics, you store credit and you debit in the simplest terms. It has a lot of other functionalities and there’s a lot of output that’s extracted from it.

But when you go back to the basics and understand that what is this component supposed to serve? And we worked on that. We worked backwards and we designed and developed our own core banking. And today, for example, I’ve launched miner account.

I’ve decided that I want to launch miner account and I launched it. This required a new segment in core banking. I did that in 24 hours.

I have no problem doing that very, very quickly. You can spin up new products, new services layers pretty quickly. One more point I just wanted to touch on.

You started talking about international players coming into the region. I believe that the markets they are in are getting saturated somehow. So that’s why they’re trying to tap into this region.

They see it as a goldmine. Unlike Europe, where you can get licensed in Lithuania and passport your license across different jurisdictions in the EU. Here, every country has its own jurisdiction and its own regulatory framework.

So I’ll be very excited to see how it goes. And I think Revolut only got their in-principle license. They have not been issued a full license yet.

So they’re not operational yet. Still in the making. Well, we hear a lot about players coming into the region.

And I couldn’t help but realize that you said we are born in Saudi. I’m sure that ambition today transcends beyond the footprint and the geography of Saudi Arabia. Tell us a bit, Mohamed, where are you taking Bark? It is born in Saudi.

It has international ambitions. But we wanted to make sure that our HQ, our headquarters, Saudi, is the most resilient, the strongest, the kind of the platform that we take off for other countries. To do that, we have ways to hack that.

And you can do it inorganically, organically. Each market has its own characteristics. And you have to remain opportunistic in your approach.

You cannot have a binary approach to this. So to answer your questions, we are eyeing the region, the MENA region. We believe that there is opportunity.

We believe that we are going to be able to ring fence a lot of these markets, and especially Saudi. So our focus today is to make Bark Saudi the strongest, most versatile variety of product, that single platform for all your digital, financial and lifestyle needs. So that statement resonates very well, because I start by saying digital, then financial, then lifestyle.

I don’t want to call myself a super app, but by definition of what I’m doing, the services I’m providing, I am becoming a bigger hero. So my focus right now is Saudi, ring fence this market. I want all the other competitors to come.

Competition is always healthy. You’ll make us learn more. You’ll make us improve and move faster.

But I believe this is where we also will be much better priced vis-a-vis competitors, especially when they come globally, and they are going to have multiple challenges. This is a very unique market. Are you looking beyond retail right now, like SME? 100%.

We have an SME and a corporate proposition. We are looking at, in fact, we’ve got our business portal already ready, and we are looking at corporates and government clients for embedding payments or embedded platforms. The future is everybody wants to have some form of a payment finance related service in their platform.

They don’t need to go get licensed. They should not even be going to get licensed, because that’s not their forte. We’ve done it very well.

We have the strong cyber security controls and other controls, and our aim is to also extend that. So exponential growth after hopefully getting 100% of the bankable population in Saudi is going to come from SMEs and corporate. That’s a pretty big target you’ve aimed at, 100% of the Saudi population.

That’s great. I couldn’t agree more. I mean, Antoine, sorry, if I’m talking about what’s happening in the region, tell me a little bit about how the investment in artificial intelligence in Saudi from the data centers and so forth, how is that going to play out, do you think, in terms of infusing that into the fintech space? It’s a very important topic to touch upon.

To rewind a bit, if you look at how fintech has evolved in the region, it started with maybe digitization, a big focus on digitization, then evolved into some disintermediation, and we’ve seen a lot of disintermediation plays. And the focus today, as you said, Mohamed, we see embeddability. That next chapter that we see shaping up today is around the agentic AI part.

So there is an acknowledgement in the region, in Saudi Arabia, in the UAE, that the differentiator to sustain the fintech hub of the region, and probably globally, is to ensure that the infrastructure is conducive for the agentic transformation. And today, as we speak, we’ve seen mega investment to Humane, to Core42, and data center, and infrastructure, but more importantly, as well, in knowledge. So today, the region is investing heavily in attracting talent and ensuring that the right players are very quickly onboarded, licensed, if needed.

Our HQ program by MISA is putting a lot of emphasis on getting the right players to make sure that the ecosystem flourishes in a way that companies like Park and others are able to transform from a human-centric or system-centric, process-centric company to an agentic company. And definitely, I mean, as you’ve said it many times, Brett, I think this is where finance is heading altogether. So that brings the obvious question, Mohamed, is what do you see, Barack, looking like in five years’ time with agentic AI and generative finance built into the stack? Very interesting.

We have started by building something called a digital twin. See, a lot of entities claim we’ve got AI, we’ve got, and it’s basically a rule-based logic, so if, if, and, yes. And we didn’t want to go down that route.

We are able to collect a lot of data about our users. And in order to really try to put users into buckets or segment them, we thought, we saw that that approach is flawed, big time. So this concept of segment of one or digital twin is our starting point.

We will be launching that very soon. And what it will do is essentially it’s going to be your own gen AI based on your behavior, your requirements, how your spending patterns are, and so on, and your finance needs. So we believe that that approach is going to be what’s going to help us.

Fast forward five years, I think for fintech, anything beyond two to three years is tough to look at because it’s a very dynamic. Right, then talk about two or three years. I will be, hopefully, I will be digital bank.

I’ll be digital bank licensed by then. I will be able to expand my offering and I will be replicating the success in other jurisdictions. It’s a big announcement here.

Yeah, there you go. So, I mean, you are a digital bank effectively today, except, you know, you’re on the payments license infrastructure, right? We are, we are a license as a major EMI, electronic money institutions, and the difference is two things. A, your ability to have custody of deposits and issue and be connected to the RTGS system, the real-time gross payment settlement system.

So we are operating as a bank, but we work currently under our license with a sponsor bank. When we become a bank, we’re able to use that, do those deposits much more efficiently and be able to create more value for our shareholders. Very cool.

So I want to ask you both now, you know, for people outside of the Saudi market, outside of the GCC, you know, what makes you excited about the future here? Because, you know, we have Vision 2030, MBS’s blueprint for Saudi. You know, we obviously, I’m based in Dubai part-time these days, and Dubai and UAE has a similar sort of real passion, you know, about the potential for the future. But just describe for people why there’s such an upbeat attitude towards what’s happening in Saudi generally today, not just in fintech and finance, but, you know, for the future.

Well, as His Royal Highness the Crown Prince said, we believe that the GCC and the region is the new Europe. But we haven’t started. We haven’t even touched upon the potential, the humongous potential of the scale of the region, and how can that really multiply the economic effect of any initiative that you do.

On payments, take a simple example, AFOC, which is the payment infrastructure that is set to create interoperability across the GCC. That was there in Europe with Target 2, and we’ve seen the impact of Target 2 on moving money in Europe. I think in the GCC we’re just starting, but the is we’re starting with the technology that is disruptive.

There is no legacy, there is appetite, there is depth of investment. I think when you combine all of that, I believe that the potential is humongous, which keeps us super excited. For me, it’s one word.

If the leadership, the people are determined on success, there is no other choice. Vision 2030 is one part of the story, but it’s more about the ability to create value in untapped territories. And to me, Saudi, GCC Bahrain, UAE, Qatar, Kuwait, Oman, all of these GCC countries have a lot to offer, and a lot of value creation, and the best is yet to come.

I’m a big believer, I am extremely long on Saudi, and I have moved my wife and my son here, and I honestly believe that, as Antoine said, it’s the tip of the iceberg. The best is yet to come. Determination, and they’re adamant, people here are adamant on achieving the vision, and what’s beyond that vision.

So what was the one word? Determination. Determination. That’s the one.

Just wanted to make that clear. Bold, underline. Yeah, bold, underline.

Listen, it’s phenomenal to have you guys here with me today to lend your expertise and share this vision with people outside of the market. But let’s talk a little bit more about yourselves. How do people find out what you guys are doing in the market, so you personally and for your companies, what’s the best way to track what’s happening, so Antoine, yourself? I try to keep up with what’s happening on LinkedIn.

I’m excited to share how the region is transforming, how we are transforming as consultancies, how our role is being shaped up. Of course, I would invite you to follow me and to check the news there. Our websites are always up to date, and of course, we hope to hear from our clients about the impact that we’re having.

And what’s Strategy Anne’s website here? Strategyanne.pwc.com. Very good. And Mohamed, how do people find out what’s happening with you and the broader mission of BRAC? Find me on LinkedIn. I only post things that really resonate very well with me.

I am available on LinkedIn, and you’re able to also look at our website, www.brac.com. The best is yet to come. Fantastic. Well, that’s it for this segment of Breaking Banks.

Stay in touch. We’ve got a lot happening, and I’m going to be doing my book signing here tomorrow, so by the time this airs, it will have happened. But that’s the global release of Branch Tomorrow.

You can check it out at branchtomorrow.com if you want some more information. It will be live this week on Amazon in the United States. Thanks for listening.

We’re going to take a quick break, and we’ll be right back.