Aber project achieves main objectives in Kingdom of Saudi Arabia
The digital currency project Aber has accomplished its main objectives that mainly include understanding, experiencing, and analyzing the maturity of the distributed ledger technology (DLT).
Aber, an initiative in cooperation with the Central Bank of the United Arab Emirates, the project aims to explore the feasibility of a single dual-issued digital currency between Saudi Arabia and the UAE through Block chain and DLT.It managed to explore cross-border payment solutions through aforementioned technology.
Saudi Central Bank (SAMA) has claimed the Global Impact Award 2021 for Aber. The Central Banking Committee granted this award as part of its Central Banking FinTech and RegTech Global Awards, appreciating “outstanding financial supervisory organizations that demonstrate a profound ability to innovate and develop within the global central banking community.”
Low interest rates boost up mortgage demand by 27% through May 2021
Local banks in Kingdom of Saudi Arabia offered residential real estate financing contracts to individuals and they have reached 133,006 through May, with a value of SR69.5 billion.
The interest rates decreased to between 1 percent and 4.9 percent, compared to about 6 percent early last year that’s the reason mortgage lending in Saudi Arabia increased 27 percent this year through May. Real estate financing grew by 50 percent compared with the same period in 2020.
There is great competition between banks and real estate finance companies to obtain a greater share of the housing demand, after government support and joint financing programs with the Real Estate Development Fund (REDF).
Saudi banks are offering mortgages with interest rates as low as 1 percent at Al Rajhi Bank, 2.5 percent at the Saudi National Bank (AlAhli Bank) and up to 4.5 percent at some banks.
Residential villas made up about 80 percent of the total financing, apartments 17 percent, while the purchase of residential lands’ financing made up the remaining 3 percent.
Saudi real estate financing attained a record growth during the past three years, amounting to about 295,590 contracts, worth SR140.7 billion in 2020 as compared to 22,259 financing contracts, worth SR17 billion in 2016.
Circular on VAT refund to eligible real estate developers in KSA
The Zakat, Tax and Customs Authority ‘ZATCA’ (formerly known as GAZT) has issued a Circular on 30 June 2021 according to which the registration process for real estate developers in order to refund input VAT incurred in relation to exempt real estate activities.
The VAT refund will consist of 2 phases mentioned below.
Phase 1: The registration process for real estate developers to become eligible persons; and
Phase 2: The process to file an application for refund of input VAT incurred in relation to exempt real estate activities.
