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FinTechs belonging to this category offer asset and portfolio management services via an internet platform or software programs and usually manage and dispose of the assets of their customers long or short term according to their specifications without actually holding the property or the possession of those assets. FinTechs, which provide information about and access to overnight or time deposit accounts at national and foreign banks and which execute the transactions to these accounts, also belong to this category. Some FinTechs however only act on request of the customer.
Aside from that some FinTechs offer software or internet solutions enabling users to manage and plan their personal finances on their own by providing graphics, overviews and compilations of their financial data and sometimes indicating financial risks or opportunities, but without actually managing the assets.
Introduction
Attitude of the country towards modern asset and portfolio management services
Saudi Arabia has been undergoing significant socio-economic reforms under the banner of Vision 2030. For FinTechs specializing in asset and portfolio management services, the Saudi market presents numerous opportunities. With a thriving investment landscape, favorable regulatory environment, and increasing demand for innovative financial solutions, FinTech firms can capitalize on the Kingdom's economic transformation to establish and expand their presence in the region.
Legal affairs
Obligations and requirements to provide asset and portfolio management, or ancillary services described above
FinTechs providing asset and portfolio management services to consumers in the Kingdom may be subject to regulation by the Saudi Arabian Monetary Authority (SAMA) and or the Capital Market Authority (CMA), depending on the nature of the services offered.
If the services are exclusively aimed at serving other regulated entities, such as banks or authorized persons, they are not required to be regulated directly by SAMA or CMA. Rather, these firms can proceed with applying for a Commercial Registration (CR) from the Ministry of Commerce. Once the CR is obtained, the FinTech firm can start its operations without needing direct regulation from SAMA or CMA.
Additional comments regarding the legal situation for asset and portfolio management services or what FinTech’s must be aware of in this business area
The regulatory landscape for FinTechs in the Kingdom is constantly evolving, with new regulations and guidelines being introduced to keep pace with the rapid development of the sector. It is crucial for firms to monitor and adapt to these changes to ensure ongoing compliance and smooth operations.