Payments • Forum

The fintech and payments space is at the forefront of Saudi Arabia’s digitalization revolution.

Salah Alghamdi DIGITAL VICE PRESIDENT, ZAIN KSA

WE STARTED by enhancing digital channels and online channels. Then, we put a digital outfit on top of what had previously been a very analogue body. What came next is a business from a digital core and not a digital outfit. That is why we started Yaqoot, our digital telecoms sub-brand. It has more than 35 employees, with only a few from Zain. Most of these employees have never worked in telecoms before and are 25 to 27-yearold graduates who have had two- or three-years’ experience in sectors outside telecoms. This was done intentionally because outsiders are necessary to innovate telecoms. When the Saudi Arabian Monetary Authority (SAMA) started the sandbox, it was a perfect time to look into something like fintech. The regulation is there, the financial structure of the country is there, the economics are there, and we are a big telecoms company with more than 8 million customers via Zain KSA. We applied to the sandbox with a vision of what we want the future to look like. One of the Zain Group’s main strategic pillars is the fintech digital banking pillar. We already have Zain Cash as a payment product in Jordan, Iraq, and Sudan.

Esam Al Nahdi CEO, HALA COMPANY

IN TERMS of fundraising, we had big plans prior to COVID-19, but as a result of the pandemic we had a shift in mentality even before investors and decided not to proceed with fundraising rounds during this period. We shifted to being self-sufficient and more resilient during this period. It changed our perspective of how tech companies are perceived. It used to be that payment companies were losing money, burning investors’ funds until they got an exit. Now, things are different, which is why we decided to move into bootstrapping mode to prove we are able to be self-sufficient by growing our revenue stream. Recently, we started looking at a round again, but with a different mentality, size, perspective, and metrics since things have changed since we grew. There has been a major challenge in Saudi for a long time in terms of human resources. When a company decides to scale up quickly, it needs a large number of team members to come onboard, and it needs to think about how it can get around the scarcity of resources. Our regional ambitions and having a group on a regional level allow us to consider recruiting teams in different locations. COVID-19 was an interesting trial for us, as working remotely has proven to be extremely productive and effective and has shown us we can scale up even if the team is not working in the office.

Osama Alraee CEO, LENDO

WHEN COVID-19 hit, we immediately identified the sectors that the nation needed immediately and supported these sectors because it would truly impact the lives of people. We looked at the suppliers of supermarkets and FMCG companies that we have been financing. It can sometimes take supermarkets 90120 days to pay these companies for the products that they put on shelves. These companies do not have enough cash to grow faster, so we helped by paying them up to 80% of the costs. This allowed the companies to produce more products, which helped them grow and ensured food stability. The second area was in logistics, where we financed many companies that were growing significantly, whether it was last-mile deliveries or long haul across borders. They have to pay the drivers’, visas, oil, and gasoline costs upfront but only collect their revenues after 90-120 days. The third aspect we looked at was e-commerce, where we customized a product during the pandemic that we will now launch fully. We were the first company in Saudi Arabia to ever finance e-commerce. It is the fastest-growing sector but not a single bank have financed e-commerce before. During the pandemic, we saw huge growth and lent large sums of money at 0% default. Meanwhile, globally many fintechs in the lending space struggled because they had immediate defaults and late payments.