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SAMA Explores Central Bank Digital Currency (CBDC) for Saudi Financial System

• The Saudi Central Bank (SAMA) unveiled its plan to experiment with central bank digital currency (CBDC).
• The SAMA is exploring several sectors including the economic impact, market viability, and potential application of CBDC-based payment solutions.
• No decision has been made regarding the introduction of the Central Bank Digital Currency (CBDC) in the Kingdom yet, as the SAMA continues to focus on exploring the potential risks and benefits of implementing CBDC.

The Saudi Central Bank (SAMA) has announced plans to experiment with central bank digital currency (CBDC), as it works collaboratively with local banks and fintech firms to explore the potential of the technology. In a phased project, the agency is exploring the economic impact, market viability, and potential application of CBDC-based payment solutions.

The SAMA has made it clear that no decision has been made regarding the introduction of the Central Bank Digital Currency (CBDC) in the Kingdom yet, as the agency continues to focus on exploring the potential risks and benefits of implementing CBDC. In a statement to Saudi-based news outlet Saudi Gazette, the SAMA said that it is “dedicated to making an informed decision-making within the central bank and to CBDC research within the central banking ecosystem.”

The SAMA is hoping to use CBDC as a useful tool for a type of domestic wholesale financial instrument. The agency has noted that its current phase of the project is centred around the exploration of the potential of CBDC and its potential uses, with a view to making an informed decision on the introduction of the technology in the future.

The central bank has been vocal in its commitment to modernizing the Saudi financial system, and its exploration of CBDC technology is just the latest project in its mission. The SAMA has shown a great deal of support for the development of fintech and digital assets in the region, having previously created a dedicated department for the oversight of digital assets and the development of a regulatory framework for the industry.

As the adoption of digital assets continues to grow widely, the SAMA is looking to use CBDC technology to modernize the Saudi financial system and create an efficient and secure payment infrastructure for the region. With its dedication to exploring the potential of CBDC, the SAMA is hoping to make an informed decision on the introduction of the technology in the future.