Saudi Arabia’s securities regulator this week approved its first two financial technology licenses for startups, helping lay the groundwork for a broader fintech sector in the kingdom.

The Capital Market Authority (CMA) handed out the licenses to Riyadh-based startups Scopeer and Manafa Capital, both of which operate equity crowdfunding platforms. The permits from the CMA will allow both companies to run their platforms on a trial basis.  

Both appear to be early-stage companies. Scopeer was founded in 2017, according to its Linkedin page, and its online platform is still under development. The founding date of Manafa Capital is unclear, but it operates a live website allowing investors and businesses to register to use its platform. 

The CMA says it will reopen the application process for fintech licenses later this year. The move from Saudi’s securities regulator comes as fintech activity is picking up in the kingdom, which is currently in the process of implementing economic reforms to diversify away from oil.

Along with the CMA, Saudi Arabia’s central bank is also eying fintech. In February 2018, the Saudi Arabian Monetary Authority signed an agreement with the U.S.-based blockchain company Ripple to help participating banks in the kingdom use its enterprise software to instantly facilitate cross-border payments.

In May 2018, Abu Dhabi-based alternative asset manager Gulf Capital acquired a stake in Geidea, a provider of electronic payment solutions in Saudi Arabia. Gulf Capital did not disclose the exact size of the stake, but revealed the value of the deal exceeded $267 million.

These developments in Saudi come as neighboring countries in the Gulf region are vying to become centers of fintech innovation. Regulators in Abu Dhabi, Dubai and Bahrain have all adopted friendly stances toward the sector, taking steps such as establishing regulatory frameworks allowing companies to test their products and creating accelerators for startups.