alrajhi Bank Acquires Majority Stake in Fintech Firm Drahim
Saudi-based lender alrajhi bank has acquired a 65% stake in the local fintech start-up ‘Drahim’ application, a leading financial management and automated investment platform licensed by the Saudi Central Bank within the FinTech Lab and the Capital Market Authority’s regulatory environment.
This acquisition is part of alrajhi bank’s strategy to leverage the latest technologies and regulatory frameworks to strengthen its leadership in the financial sector.
The takeover marks the first of its kind in the region, with a Saudi bank securing a majority stake in a local fintech start-up. ‘Drahim’ is a Saudi-based app that aims to deliver open banking and fintech services to individuals, aspiring to become the leading platform for investment and savings services in the region.
The fintech strategy aims to empower financial institutions by fostering innovation and welcoming new entities to provide financial services. It aligns with global trends towards a more advanced financial system that supports entrepreneurship and expands opportunities for the private sector, offering a diverse range of financial products and services, positioning the Kingdom as a global hub for fintech companies.
The acquisition followed a pre-seed round led by Sanabil Investments via the 500 Fund, with contributions from angel investors and Gulf investment firms, and was succeeded by a seed round led by (Y Combinator), the world-renowned business accelerator.
Drahim offers numerous benefits to individuals, including the ability to consolidate bank accounts in one place, track expenses instantly with an automated classification engine, and manage and grow investments through various asset classes such as stocks, real estate, and bonds. The app has also recently introduced features to link and monitor external portfolios.
Empowering Fintech Firms
The bank’s Managing Director and CEO Waleed Al-Mogbel said that the investment in ‘Drahim’ reflected the bank’s commitment to empower fintech companies and support their growth, aligning with alrajhi’s vision to be a preferred partner for emerging companies in the fast-growing fintech sector.
“Developing the financial sector is a key objective of Saudi Vision 2030, which aims to foster 525 fintech companies by 2030, enhancing the role of fintech players in driving innovation and competition,” Al-Mogbel added.
‘Drahim’ CEO Sultan Al Khayal expressed his pride in the partnership with alrajhi bank, and said that this acquisition is a testament to the success of the Saudi Central Bank’s experimental regulatory environment and the Capital Market Authority’s FinTech Lab, which have paved the way for start-ups to build innovative solutions that contribute to the Financial Sector Development Program’s goals.
Al Khayal further emphasised the start-up’s role in achieving the Financial Sector Development Program’s objectives by enhancing daily banking experiences, savings, and retirement planning through its investment products.
He said that agreement builds on past successes and showcases the maturity of the local market and praised the dedicated ‘Drahim’ team for their commitment and passion since the company’s inception, working diligently to achieve their objectives.
Through this investment, ‘Drahim’ aims to continue advancing its products for individuals and businesses in financial management, investment, and payment solutions, enhancing the quality of available financial services.
Founded in August 2021 by Sultan Al Khayal and Yasser Al Sharihi, the start-up was established with the goal of advancing the Financial Sector Development Program. In a short period, the company obtained authorisations from the Saudi Central Bank to provide open banking services and from the Capital Market Authority to offer automated investment advisory services.
