We are participating in a $440m (SAR 1.65bn) investment round in D360 Digital Bank, one of the first digital banks in Saudi Arabia and one of the first Shariah-compliant digital banks in the world.
The banking sector in Saudi Arabia is one of the largest and fastest-growing in the region with a domestic credit growth of 14.5% in 2020 alone, and is expected to grow further in the coming years driven by the economic stimulus of Vision 2030 and the recovery of the sector from the pandemic. Despite the momentum, however, the market is still significantly underserved and underpenetrated, with household lending – at 19% of GDP – largely below the level of developed markets such as China (54%), France (60%), the USA (76%), and South Korea (92%). The same is true for lending to SMEs in the country.
As other international markets have seen the emergence and success of neobanks, we are convinced the traditional Saudi banking market is ripe for a digital bank. Recent accelerated adoption of contactless and cashless payments -a sign of increased confidence in digital payments-, and leading internet and mobile penetration within a relatively young, savvy population are all signals that financial services are ready for disruption.
By investing in D360, we are backing what we expect to become the leading one-stop-shop Shariah-compliant digital bank for all in Saudi Arabia, providing hassle-free, intuitive financial and banking products. While traditional banks see their digital banking as a subset of their offering, the digital bank has this proposition front and center, at the core of its existence. We met the team at D360 and have been impressed by their product vision, aimed at taking banking in the Kingdom to the next level.
We’re excited to support the D360 team in building the next generation bank for Saudi Arabia.