How SAMA Became the Global Gold Standard for Authentication Regulation

TL;DR

Saudi Arabia's central bank (SAMA) has quietly built one of the most actionable authentication regulatory frameworks in global financial services. While many regulators issue broad guidelines about "strong authentication," SAMA's Cybersecurity Framework provides specific, measurable requirements with defined timelines — and backs them with a collaborative enforcement model. The result is a framework that other regulators across the GCC, APAC, and beyond are now studying. This article examines what SAMA got right, why it matters for financial institutions operating in the Kingdom, and what the approach signals for the future of authentication regulation globally.

Why Authentication Regulation Usually Falls Short

Most financial regulators approach authentication with good intentions but vague guidance. Frameworks reference "strong customer authentication" or "risk-appropriate controls" without specifying what qualifies. Banks receive policy documents full of aspirational language, interpret them differently, and implement unevenly. The gap between regulatory intent and real-world security outcomes widens.

The European Banking Authority's experience with PSD2's Strong Customer Authentication requirements illustrates this pattern. Years after implementation deadlines, compliance varied widely across member states, with ongoing extensions and carve-outs diluting the original security objectives. The regulation was directionally correct but lacked the specificity needed to drive consistent outcomes.

SAMA took a fundamentally different approach — one defined by clarity, collaboration, and measurable expectations.

What SAMA's Cybersecurity Framework Actually Requires

Specific Technical Standards, Not Suggestions

SAMA's Cybersecurity Framework stands apart from peer regulations because it specifies which authentication methods qualify as compliant and which are being deprecated. Rather than leaving "phishing-resistant authentication" open to interpretation, the framework provides technical definitions aligned with international standards including FIDO Alliance specifications.

The framework explicitly addresses SMS-based OTP — acknowledging it as a legacy method with known vulnerabilities to SIM swap attacks, real-time phishing, and social engineering. SAMA's guidance directs financial institutions to transition toward phishing-resistant alternatives for high-risk transactions, with device-bound authentication methods (including FIDO2-compliant passkeys and hardware security keys) identified as qualifying approaches.

This specificity eliminates the compliance ambiguity that plagues other markets. A Saudi bank's security team can read SAMA's requirements and know exactly what needs to be implemented, rather than debating internally what "appropriate authentication" means.

Staged Timelines That Enable Planning

SAMA's implementation expectations include staged timelines rather than cliff-edge deadlines. Financial institutions receive advance notice of requirement changes with sufficient lead time for technology evaluation, vendor selection, integration work, and customer education.

This approach reflects an understanding that authentication transformation is operationally complex. Banks need to evaluate technology options, test implementations against their existing infrastructure, train staff, and communicate changes to customers. Rushing this process leads to poorly implemented solutions that create new security gaps or customer experience failures.

The staged approach also allows SAMA to observe early implementations, identify common challenges, and issue supplementary guidance before later-stage requirements take effect — creating a feedback loop that improves outcomes across the sector.

Collaborative Enforcement Over Punitive Compliance

Perhaps the most distinctive element of SAMA's approach is its enforcement philosophy. Rather than positioning itself purely as a compliance enforcer, SAMA established mechanisms for ongoing dialogue with financial institutions during implementation.

Banks can engage with SAMA's cybersecurity teams on implementation questions, share challenges encountered during deployment, and learn from approaches that worked at other institutions. This collaborative model reduces the adversarial dynamic that characterizes regulator-bank relationships in many markets.

SAMA also introduced positive incentives alongside compliance consequences. Financial institutions demonstrating security leadership and early adoption receive recognition and streamlined approval for new digital banking initiatives. Those lagging face increased supervisory scrutiny and potential restrictions on launching new customer-facing services until authentication standards are met.

This balanced model — where security excellence is rewarded, not just security failure punished — creates competitive dynamics that accelerate adoption beyond what penalty-only enforcement achieves.

SAMA's Framework in Context: The Vision 2030 Connection

SAMA's authentication leadership doesn't exist in isolation. It's a direct expression of Saudi Arabia's Vision 2030 economic transformation program, which positions the Kingdom as a digital economy leader. Robust authentication infrastructure is foundational to the digital financial services ecosystem Vision 2030 envisions.

Saudi Arabia's fintech sector has expanded rapidly under Vision 2030 — the Saudi Central Bank licensed its first digital-only banks and continues expanding the fintech regulatory sandbox. These digital-native institutions require authentication frameworks that enable innovation while maintaining security standards. SAMA's framework provides this foundation.

The connection to national strategy gives SAMA's authentication requirements weight and durability that standalone regulatory initiatives often lack. Authentication security isn't treated as a compliance checkbox but as critical infrastructure for national economic development.

Regional Influence: The GCC Authentication Alignment

SAMA's framework has become a reference point for authentication regulation across the Gulf Cooperation Council. The UAE Central Bank issued its own directive addressing OTP deprecation for certain transaction types, with requirements that closely parallel SAMA's approach. Bahrain's Central Bank and Kuwait's Central Bank have similarly moved toward more specific authentication requirements.

This regional alignment creates a "GCC authentication standard" effect — financial institutions operating across Gulf markets face increasingly consistent requirements rather than fragmented, market-specific approaches. For multinational banks and fintechs, this consistency reduces compliance complexity and enables unified authentication strategies.

The coordination isn't accidental. GCC central banks maintain active information-sharing relationships, and SAMA's demonstrated success in translating authentication requirements into measurable outcomes provides a proven model for peer regulators to adapt.

Influence Beyond the Gulf

SAMA's regulatory model is attracting attention well beyond the Middle East. Regulators in Southeast Asia — including those in the Philippines, Indonesia, and Malaysia — face similar challenges: rapidly growing digital payment ecosystems, diverse user populations, and evolving fraud threats. SAMA's approach of combining specific technical requirements with collaborative enforcement offers a template adaptable to different market conditions.

The Philippines' BSP (Bangko Sentral ng Pilipinas) issued Circular 1213 with authentication requirements that share SAMA's emphasis on specificity and phishing resistance. Indonesia's OJK (Financial Services Authority) has engaged in regulatory dialogue on authentication standards that reflects similar principles. While these frameworks aren't copies of SAMA's, the directional alignment suggests growing consensus around SAMA's regulatory philosophy.

International standards bodies have also taken notice. The FIDO Alliance's work with financial regulators globally frequently references the GCC's regulatory leadership on phishing-resistant authentication adoption. SAMA's participation in international cybersecurity and financial regulation forums has amplified the framework's influence on global regulatory thinking.

What Other Regulators Can Learn

Specificity Drives Compliance

The authentication regulation litmus test: could a bank's security team read this regulation and know exactly what to implement? If the answer is no, the regulation needs more specificity. Vague principles produce inconsistent implementation and compliance theater.

Timelines Create Urgency Without Panic

Regulations without deadlines become suggestions. But timelines that are too short create panic and corner-cutting. SAMA's staged approach — with clear dates, interim milestones, and final requirements — creates urgency while enabling proper planning. Other regulators should study this model when setting their own implementation expectations.

Collaboration Produces Better Outcomes Than Confrontation

When regulators position themselves as partners in security transformation rather than adversaries looking for failures, banks engage differently. Technical advisory programs, information sharing, and recognition of leaders create environments where institutions invest in genuine security improvement rather than minimum viable compliance.

Outcome-Focus Enables Innovation

By specifying security outcomes (phishing resistance, credential theft prevention) rather than mandating specific products, SAMA's framework encourages innovation. Banks can choose passkeys, hardware security keys, biometric-bound credentials, or emerging approaches — provided they demonstrably meet security requirements. This flexibility is particularly important as authentication technology continues evolving rapidly.

Challenges and Honest Assessment

SAMA's approach isn't without challenges. Smaller Saudi financial institutions with limited technology budgets face greater difficulty meeting requirements that larger banks implement more easily. The pace of technology change means even specific frameworks require regular updates to remain current — a resource-intensive undertaking for any regulator.

Additionally, measuring the actual security impact of regulatory frameworks is inherently difficult. Fraud reduction in any market reflects multiple factors beyond authentication improvements: better fraud detection systems, law enforcement actions, customer education, and broader economic conditions. Attributing specific outcomes to specific regulatory provisions requires careful analysis.

SAMA's continuous review process — treating the framework as a living document updated based on implementation experience and emerging threats — addresses some of these challenges but requires sustained investment in regulatory capability that not all central banks can match.

What This Means for Financial Institutions

For banks and fintechs operating in Saudi Arabia, SAMA's framework provides clear direction. Authentication modernization isn't optional, and the expectations are specific enough to guide technology investment decisions. Institutions that haven't begun transitioning from legacy authentication methods should treat this as urgent.

For financial institutions in other markets, SAMA's approach signals where global authentication regulation is heading. The trend toward specific, measurable authentication requirements with defined timelines is accelerating. Institutions that proactively adopt phishing-resistant authentication now — even before their local regulators require it — position themselves ahead of inevitable compliance demands while improving actual security outcomes.

For the broader financial services industry, SAMA's framework represents a maturation of authentication regulation. The era of vague guidelines and voluntary adoption is ending. What replaces it looks increasingly like SAMA's model: clear requirements, reasonable timelines, collaborative enforcement, and measurable outcomes.

Sources

• SAMA Cybersecurity Framework — Saudi Central Bank
• Saudi Vision 2030 Financial Sector Development Program
• FIDO Alliance — Passkey Specifications and Deployment Guidelines
• UAE Central Bank — Regulations and Standards
• BSP Circular 1213 — Authentication Requirements for Digital Payments
• EBA — Regulatory Technical Standards on Strong Customer Authentication
• NIST SP 800-63-4 — Digital Identity Guidelines