Saudi Arabia Forays Into CBDC Exploration Through Saudi Central Bank

• The central bank plans to continue its experiments with a possible CBDC deployment.
• Saudi Central Bank (SAMA) is the driving force behind the initiative.

The CBDC Experiment was announced by the Central Bank of Saudi Arabia in a press statement published today. The central bank plans to continue its experiments with a possible CBDC deployment, according to the statement.

The statement reaffirms the country’s commitment to explore the CBDC from a wholesale perspective. In particular, it is being noted that “A phase of a project that causes on the domestic wholesale CBDC use cases in collaboration with local banks and FinTechs” is now being worked on by the nation’s central bank. The press statement also revealed that the Saudi Central Bank (SAMA) is the driving force behind the initiative.

Saudi Vision 2030

The statement stated that the effort is consistent with global CBDC activities being undertaken by a number of central banks. Moreover, as “part of SAMA’s ongoing research and experimentation on CBDC,” the development is also described. The panel then emphasized its investigation into the “economic impact, market readiness, and potential robust and fast applications of a CBDC-based payment solution.”

However, the newly disclosed CBDC development testing is just the beginning. It says the Central Bank would “review policy, legal and regulatory considerations before moving to the next phase of the CBDC journey.” The Saudi Vision 2030 is being supported by this.

The press release also quoted SAMA governor H.E. Fahad Almubarak as saying, that the local banks and payment firms will always be the backbone of this initiative and its execution.

The CBDC development process, on the other hand, has reportedly begun conversations with both local banks and fintech companies, as well as other market participants and third-party consulting and technology suppliers.