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Open banking technology providers are eying the potential market in Jordan.
While it may not be the first country in the Middle East to introduce open banking, the Central Bank of Jordan (CBJ) made an important first step last month by issuing instructions to banks to begin sharing information via open banking application programming interfaces (APIs).
The new framework is expected to come into force at the end of 2023, giving banks less than a year to comply and release their own open banking APIs.
But whereas banks in countries like the U.K. had to start from scratch when they were given a similar mandate, a growing number of technology developers have emerged that specialize in open banking and can help banks build compliant APIs as well as add additional features and services.
One of such firms is open banking specialist Salt Edge, which recently announced its expansion to Jordan. In a recent blog post, the company said that it will be marketing its “ready-to-go” solution to banks in the country with a promise that it can help them comply with the new rules in just one month.
The recent activity in Jordan comes at a time when open banking is gathering some serious momentum in the Middle East.
After launching its open banking framework in November, Saudi Arabia has already introduced Account Information Services (AIS) — APIs that provide access to information only. And in the next phase of its rollout, the country is also set to launch Payment Initiation Services (PIS).
To further accelerate progress in the space, the Central Bank of Saudi Arabia (SAMA) opened a dedicated open banking lab this month that will act as a regulatory sandbox for the development of new open banking services.
In the blog post referenced earlier, Alina Beleuta, chief growth officer at Salt Edge, said that “as the Middle East is taking confident steps to accelerate its position as a global financial hub, we are thrilled to see countries like Jordan taking proactive measures to achieve this.”
Building on Jordan’s Payment Infrastructure
The CBJ has certainly been instrumental in the development of the broader payments ecosystem in the country.
For example, in 2017, it spearheaded the launch of the Jordan Payments and Clearing Company (JoPACC) alongside 22 commercial banks to establish interbank payment networks and develop payment solutions for end users.
In an interview with PYMNTS, JoPACC’s CEO Maha Bahou said that payments are “the frontier towards more financial services,” adding that basic digital infrastructure is a prerequisite for increased access to credit and loans.
And while she observed that JoPACC can’t solve the access problem alone, she noted that the organization is working closely with lenders to help integrate modern payment systems into their disbursement and repayment mechanisms.
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