With total savings exceeding two billion riyals.. A technical sector changes the culture of savings associations in the Kingdom

Since 2018, the Saudi Central Bank has authorized 3 financial technology companies operating in the activity of electronic savings associations, namely (Circlez, Hakba, Money Loop), which provide savings and financing association services through electronic applications, within the legislative experimental environment, the total amounts saved on these platforms exceeded two billion riyals, and the number of participants exceeded 3 million beneficiaries.

Monthly financial associations operate through electronic platforms, by collecting the electronic savings application equal amounts of money on a monthly basis from participating members in the association who are guaranteed after verifying the eligibility of the participant, and each of them pays a specific amount of money every month, thus the total amount is collected and distributed to all members periodically in a safe manner, which encourages individuals to save, to achieve financial goals.

The total amounts saved by participants in the “Circlez” application amount to 1.2 billion riyals, serving more than 2 million beneficiaries, and the investment rounds amounts exceeded 15 million riyals.

The shortest association term at Circlez is 3 months, and the longest term is 12 months for 12 members. The association term is continuously reviewed in the Saudi Central Bank’s legislative experimental environment. While the “Hakba” application succeeded in exceeding 850 million riyals in savings, according to a previous statement by the company’s founder, the application also attracted 850 thousand customers within 4 years of its establishment, while he indicated that the company achieved profits through simple fees for the association’s membership service, in addition to a portion of the profits for partners. Regarding the association duration in “Hakba”, the shortest duration currently is 4 months, and the maximum duration is 12 months for 12 members, where one beneficiary is accepted per month, and the lowest installment currently is 300 riyals and the highest is 5,000 riyals per month, with a periodic review of the association duration and the maximum limit on an ongoing basis within the work in the experimental legislative environment of the Saudi Central Bank, while the service fees start from 99 riyals and are comprehensive and paid once upon joining the association, including all services such as promissory note, verification, value added tax, payments, administrative fees, and others. As for the “Money Loop” application, it enables the subscriber to receive an association amount of up to a maximum of 60 thousand riyals, where he can choose a monthly installment starting from 100 riyals up to 5,000 riyals, and the beneficiary can choose the association duration between 3 months and 12 months. It is worth noting that the Saudi Central Bank designed the legislative experimental environment to understand the impact of modern services, products and technologies on the financial services market in the Kingdom and to evaluate the impact. It enables financial institutions and emerging financial technology companies to test an innovative financial product or service in the market with real customers, during a specific period with a number of controls and restrictions. The experimental environment has a direct relationship with the Kingdom’s Vision 2030, which aims to enhance economic growth and investment activities.