The Saudi Central Bank announced the upgrading of the restrictions for engaging in debt crowdfunding activity after the deadline for receiving public comment on the idea of modernization via the National Competitiveness Center’s “Estisalah” website expired.
The update of these rules stems from the Central Bank’s ongoing efforts to develop the finance sector, keep up with developments in the finance industry in general, and continue its efforts to support and enable financial technology businesses, which has resulted in the emergence of many technology companies, according to a press release posted on the bank’s website on Tuesday.
Updated Rules for Practicing Debt Crowdfunding Activity
The Central Bank update included redefining the beneficiary to include all commercial establishments registered in the Kingdom of Saudi Arabia seeking financing through the debt crowdfunding platform, as well as adding a definition of pooled accounts to ensure complete separation between the funds of the financing process participants and the funds of the crowdfunding facility with debt, as well as determining the ceiling of funds through the financing platform.
The new guidelines featured a complete separation of the money of the crowdfunding facility and the funds of the participants in the fundraising process.