INTRODUCTION
The Saudi Arabian Monetary Authority, or SAMA, is like the financial guardian of Saudi Arabia. Think of it as a big bank that keeps an eye on all the money stuff in the country. Established in 1952, it has some important jobs to do.
One big task is making sure the money in Saudi Arabia, called the Saudi riyal, stays steady and doesn’t lose its value. SAMA does this by using tools like interest rates. It’s like a superhero keeping the country’s money safe and stable.
SAMA also watches over the banks and insurance companies in Saudi Arabia. Imagine it as a caring teacher making sure all the students (the banks and companies) follow the rules and play fair. This helps to keep the entire financial system strong and trustworthy.
And just like a coach of a sports team, SAMA manages the national currency, the Saudi riyal. It decides how much of it is in circulation and keeps an eye on foreign exchange reserves, which is like a backup fund.
In simpler terms, SAMA is a financial protector, that makes sure everything with money in Saudi Arabia runs smoothly and stays safe. It’s like the country’s financial guardian, making sure everyone plays by the rules and the money stays strong.
HISTORICAL CONTEXT OF SAMA
Let’s dive into the past to understand how the Saudi Arabian Monetary Authority (SAMA) came to be. Picture this: it’s the year 1952, and Saudi Arabia is growing and changing. In that time, the leaders decided they needed a special team to take care of the country’s money matters. So, they created SAMA! It started small, with a job to look after the banks and make sure everything in the financial world played by the rules. As years passed, SAMA’s role grew bigger. It became like a wise guide, helping Saudi Arabia’s money stay safe and strong. So, the historical context of SAMA is like the beginning of a story where a team was formed to protect and manage the country’s money, and over time, it became a vital part of Saudi Arabia’s financial journey.
SAMA CYBERSECURITY FRAMEWORK STRUCTURE
Cybersecurity plays a major role in setting up compliance level to be achieved in SAMA regulations. It strengthens the internal systems in a secure and compliant manner to ensure the security is intact during SAMA delivery. The framework is divided to 4 main domains are illustrated in below pictures.
The SAMA Cyber Security Framework integrates best practices from multiple government frameworks and industry standards, including the National Institute of Standards and Technology (NIST) Framework for Improving Critical Infrastructure Cybersecurity (NIST CSF), the Payment Card Industry Data Security Standard (PCI DSS), and the ISO 27001/27002 Information Security Management Standards
Complete illustration of the framework can be described in below diagram as released in SAMA handbook.
CYBERSECURITY MATURITY LEVELS
The SAMA cyber security maturity levels integrated into 6 different levels starting from 0 to 5 and organizations are rated from 0 to 5 in their maturity levels. Diagram below shows the different levels of the maturity and all the controls / parameters are rated on these levels.
Organizations thrive to rise to the level of adaptiveness by crossing various stages and at each levels certain cyber security controls are tested and leveraged for going up the ladder.
The details related to each maturity level to be followed with definition and explanation is mentioned and explained in table(as defined in SAMA guidelines released by the authoritative sources) below
Continuous testing and security evaluation is the key to reach to adaptive level in cyber security.
SAMA’s IMPACT ON THE SAUDI ECONOMY
SAMA, the financial guardian of Saudi Arabia, has a big impact on how the country’s money works. One big way it helps is by keeping the money stable. SAMA does this by using clever tools, like adjusting how much interest people get on their savings. This helps when the world’s money is going up and down like a rollercoaster – Saudi Arabia’s money stays steady.
SAMA also acts like a rule-keeper in the financial game. It watches over banks and insurance companies, making sure they play fair. This is like having a caring referee in a game, ensuring everyone follows the rules. When everyone plays fair, it makes the financial system trustworthy for businesses and regular people.
But SAMA’s impact goes even further. It wants everyone to have a chance to be part of the economic game. So, it works to make sure more people can use banks and digital money easily. This way, everyone can join in and benefit from the country’s economic growth.
When tough times hit the world, SAMA steps in to protect Saudi Arabia. It uses smart strategies to help the country’s money stay strong, even during unexpected challenges. It’s like a shield that keeps the Saudi economy safe from outside troubles.
SAMA also takes care of the country’s own money, the riyal. It’s like having a special caretaker for a pet. SAMA looks after how many riyals are around and keeps savings, just in case something unexpected happens. This way, Saudi Arabia stays in control of its money and can face economic changes with confidence.
In simple words, SAMA is like a financial protector, that keeps Saudi Arabia’s money safe, stable, and strong. It makes sure everyone plays by the rules, helps more people join the economic game, and shields the country from tough times. It’s a big part of why Saudi Arabia’s money stands tall and proud!
TECHNOLOGICAL INNOVATIONS AND FINTECH
In propelling Saudi Arabia into the digital frontier, the Saudi Arabian Monetary Authority (SAMA) stands at the forefront of technological innovation, steering the financial sector into the future. As the world enthusiastically embraces the digital age, SAMA adopts a forward-thinking approach, recognizing the transformative potential of technological advancements and their profound impact on the financial landscape.
One notable initiative spearheaded by SAMA is the exploration of a Central Bank Digital Currency (CBDC). In essence, a CBDC is a digital form of a country’s national currency issued by the central bank. SAMA’s foray into this realm signifies a progressive step towards a cashless future, where transactions occur digitally, offering benefits in terms of efficiency, security, and financial inclusion. By considering the adoption of a CBDC, SAMA positions itself as an innovator, setting the stage for Saudi Arabia to be among the pioneers in modern financial practices.
Additionally, SAMA actively fosters an environment conducive to advancements in financial technology, commonly known as fintech. Fintech encompasses a broad spectrum of innovations, from mobile payment solutions and blockchain technology to artificial intelligence-driven financial services. By nurturing an ecosystem that encourages the development and implementation of fintech solutions, SAMA creates a dynamic landscape where traditional financial services seamlessly integrate with cutting-edge technologies.
This commitment to fintech is particularly significant as it enhances the efficiency and accessibility of financial services. Mobile banking applications, digital wallets, and other fintech solutions simplify financial transactions, making them more accessible to a broader segment of the population. SAMA’s role in fostering this environment aligns with global trends that prioritize leveraging technology to enhance financial inclusion and streamline financial processes.
Furthermore, SAMA’s emphasis on technological innovation positions Saudi Arabia as a hub for financial technology in the Middle East. The Kingdom’s commitment to embracing modern financial practices not only enhances its own economic infrastructure but also contributes to the broader narrative of the region’s technological evolution. This strategic positioning opens avenues for collaboration and partnerships with global fintech entities, fostering a vibrant ecosystem of innovation and expertise.
CONCLUSION
SAMA emerges not merely as a central bank but as a stalwart guardian of economic prosperity, a regulator fostering financial integrity, and a catalyst for innovation. In an evolving global landscape, SAMA remains a cornerstone, contributing to Saudi Arabia’s financial resilience and steering towards a prosperous future.
How Compliance Foresight Helps?
Compliance Foresight enables the monitoring of SAMA compliance with predefined templates and compliance controls. These controls are defined in SAMA directory and is enabled on platform for the end users to initiate the compliance tracking.
This helps the organization to onboard compliance journey with ease and start their compliance tracking with all departments participating in reporting the compliance levels.
Management will have ready reference dashboards to have a bird eye view of the organization SAMA compliance readiness.
SOURCE LINK –
https://www.sama.gov.sa/enUS/RulesInstructions/CyberSecurity/Cyber%20Security%20Framework.pdf
