Landmark reform removes long-standing entry barriers, signaling a new era for the Tadawul and Saudi Arabia’s capital market ambitions
Saudi Arabia is set to abolish the Qualified Foreign Investor (QFI) framework from February 1, marking one of the most consequential liberalization moves in the Kingdom’s capital markets history. The reform eliminates the $500 million assets-under-management threshold and complex licensing requirements that previously limited direct access to the Tadawul to only the world’s largest institutional investors.
The move builds on the momentum of the 2025 Investment Law and reflects Saudi Arabia’s intent to position its equity markets as a core destination for global capital, rather than a selective or peripheral allocation. By removing structural friction for foreign investors, the Kingdom is simplifying participation and encouraging deeper, more consistent engagement with its rapidly expanding economy.
“Removing the QFI gate isn’t a technical tweak—it’s Saudi lowering the impedance between global capital and the Kingdom’s growth engine.”
— Faisal Al Monai, CEO, droppRWA
Market observers say the change sends a strong signal that Saudi Arabia wants the Tadawul to be priced daily by global investors, not approached episodically. The reform is expected to broaden the investor base, improve liquidity, and enhance price discovery across Saudi-listed companies, particularly as the Kingdom continues to diversify beyond hydrocarbons under Vision 2030.
Beyond equities, the QFI abolition also reflects a broader modernization of Saudi Arabia’s financial infrastructure. According to Faisal Al Monai, CEO of droppRWA a tokenization platform working closely with the Saudi government—the reform should be viewed as part of a deeper structural shift in how ownership, settlement, and enforceability are being redesigned.
Saudi Arabia has been upgrading the “plumbing” of its financial system, Al Monai noted, pointing to the Real Estate General Authority’s (REGA) announcement in November 2025 of a blockchain-based token standard for property. The move marked a global first and underscored the Kingdom’s intent to encode regulatory and market reform directly into infrastructure.
These developments have significant implications for real-world assets (RWAs), where tokenization is moving from concept to large-scale settlement infrastructure. Strengthening market-level ownership and enforceability, experts argue, enables faster, more auditable transactions suited for national-scale asset markets.
Together, the abolition of the QFI regime and parallel digital market reforms position Saudi Arabia as one of the most ambitious capital market transformation stories globally in 2026 one that global investors may no longer be able to afford to ignore.
