STC Bank Launches 'Smart Finance' - Saudi Arabia's First Fully Electronic Financing Product

STC Bank has launched Smart Finance, described as Saudi Arabia's first fully electronic financing product, offering Sharia-compliant personal financing through its mobile app without requiring customers to transfer their salary to the bank.

The product eliminates one of the most common barriers to accessing personal finance from digital banks: the requirement to move salary payments to the lending institution. By removing this condition, STC Bank can serve customers who maintain their primary banking relationship elsewhere while still wanting to access digital lending products.

Smart Finance is available entirely within the STC Bank mobile app, with the application, credit assessment, approval, and disbursement processes all handled digitally. The bank uses AI-driven credit assessment models that analyse multiple data points to make lending decisions without the traditional reliance on salary assignment as the primary risk mitigation tool.

The product launch marks an important step in STC Bank's evolution from a payments-focused platform to a full-service digital bank. Lending products are critical for bank profitability, and Smart Finance provides STC Bank with an interest income stream that complements its transaction-based revenue.

The Sharia-compliant structure ensures that the financing product meets Islamic finance principles, an important consideration in Saudi Arabia where demand for compliant financial products is strong. The product uses a Murabaha or similar structure that provides the customer with financing while adhering to the prohibition on interest.

STC Bank's growing product range positions it as an increasingly competitive alternative to established Saudi banks.