Article Detail | Fintech Oasis

Saudi Arabia's central bank is moving open banking from account information to payment initiation.

From read to write

Saudi Arabia's open banking journey began with the unglamorous half of the project: letting consumers securely share their account information with third parties. The first phase of SAMA's framework, built on consent and standardised APIs, put the plumbing in place and licensed the first batch of regulated third-party providers.

The second phase is the harder, more consequential half — payment initiation. Where the first phase let a consumer show a fintech their data, the second lets that fintech, with consent, instruct a payment on the consumer's behalf. That is the shift that turns open banking from infrastructure into a competitive force.

Why payment initiation matters

Account information services are useful but passive. They power budgeting apps, credit scoring, and personal finance dashboards. Payment initiation is active: it lets a consumer pay from their bank account through a third-party interface, without leaving an app or reaching for a card.

For merchants, that means lower payment costs and fewer failed transactions. For consumers, it means an alternative to cards that is both convenient and directly connected to their bank. For the banks themselves, it means a new channel for payments revenue — and a new reason to compete on experience.

The regulatory discipline

SAMA's sequencing has been deliberate. By starting with information services, it let the ecosystem build trust and let the regulator build supervisory muscle before authorising payment flows. The licensed providers in the second phase carry stricter operational and security obligations, and the consent framework is central to the entire regime.

The bet is that openness, properly supervised, deepens the financial system rather than destabilising it. The early evidence from other markets is that it does. Saudi Arabia's second act will be watched as a regional template.