Logo of Saudi Central Bank (SAMA)
The Saudi Central Bank (SAMA) issued updated rules for debt-based crowdfunding activities under its supervisory role over debt crowdfunding companies and ongoing efforts to develop the financing sector, particularly the fintech sector.
In a statement received by Argaam, the bank detailed several key updates for the new rules, including additional disclosure requirements, mainly obligating debt crowdfunding companies to disclose default rates on their platforms.
The rules also permit these companies to participate in financing benefiting entities, subject to specific regulations. Furthermore, debt crowdfunding companies are allowed to finance benefiting entities with amounts exceeding SAR 7.5 million for large commercial enterprises and licensed real estate development activities, or when obtaining written consent from the central bank.
The implementation of these updates follows a prior initiative by the central bank to solicit public feedback on the draft of the updated rules for engaging in debt-based crowdfunding, aimed at enhancing transparency and stakeholder engagement. SAMA carefully considered the feedback and observations in the final formulation of the regulations.
