Saudi hotel spending rises 8.5% despite overall drop in POS transactions: SAMA
Saudi hotel spending rises 8.5% despite overall drop in POS transactions: SAMA/node/2576448/business-economy
Saudi hotel spending rises 8.5% despite overall drop in POS transactions: SAMA
According to figures from the Saudi Central Bank, hotels were the only sector to see an increase, while spending across all other sectors fell. Shutterstock
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Updated 23 October 2024
MIGUEL HADCHITYÂ
Saudi hotel spending rises 8.5% despite overall drop in POS transactions: SAMA
POS transactions dropped by 7.5% to SR11.3 billion, continuing a downward trend after a 2.6% increase in early October
Education sector experienced the biggest decline, with spending down 25.3% to SR94.1 million
Updated 23 October 2024
MIGUEL HADCHITYÂ
RIYADH: Hotel spending in șÚÁÏÉçÇű surged by 8.5 percent during the week of Oct. 13â 19, reaching SR293.8 million ($78.2 million), despite an overall decline in point-of-sale transactions, official data showed.Â
According to figures from the Saudi Central Bank, also known as SAMA, hotels were the only sector to see an increase, while spending across all other sectors fell.Â
Overall, POS transactions dropped by 7.5 percent to SR11.3 billion, continuing a downward trend after a 2.6 percent increase in early October.Â
The education sector experienced the biggest decline, with spending down 25.3 percent to SR94.1 million. Telecommunications and public utilities followed with drops of 14.7 percent and 12.4 percent, recording SR103.6 million and SR48.4 million, respectively.Â
Spending on construction and building materials recorded the smallest decline, dipping 4.1 percent to SR331.2 million.Â
Restaurant and cafe expenditures fell 5 percent to SR1.76 billion, while gas station spending dropped 5.7 percent to SR866.4 million.Â
Looking at the biggest value of transactions this week, the food and beverages sector stepped down from the first spot as the biggest share of the POS, recording an 8.6 percent decrease to SR1.74 billion.Â
This was followed by miscellaneous goods and services at SR1.3 billion, with an 8.3 percent dip.Â
The top three categories accounted for nearly 45 percent of the weekâs total POS value at SR5.1 billion.Â
Riyadh dominated POS transactions, representing 34.7 percent of the total, with spending in the capital reaching SR3.9 billion, recording a decrease of 6.9 percent.Â
Jeddah followed closely with a 6.8 percent dip to SR1.5 billion, accounting for 13.8 percent of the total, and Dammam came in third at SR587 million, down by 6.3 percent.Â
Hail saw the biggest decrease in spending, down by 10.3 percent to SR174 million. Abha and Buraidah also experienced declines, with expenditures dipping 8.3 percent and 9.1 percent to SR137 million and SR266.6 million, respectively.Â
In terms of the number of transactions, Hail recorded the highest decrease for the second week in a row at 7.9 percent, reaching 3,478. Tabuk and Madinah followed with declines at 7.7 percent and 5.3 percent, reaching 4,362 and 8,038 transactions, respectively.Â
The scent of Vision 2030: Saudi oudâs journey to world markets
șÚÁÏÉçÇűâs oud makers and exporters are expanding to keep up with rising global demand
Updated 27 September 2025
Reem Walid
RIYADH: While perfumes are gaining fresh attention across the Kingdom, oud remains the soul of the Gulfâs scent identity, deeply rooted in Saudi heritage and now poised for global growth.
șÚÁÏÉçÇűâs oud and fragrance retail market is projected to see a 14 percent compound annual growth rate from 2024 to 2029, reaching approximately SR18.5 billion ($4.93 billion) by the end of the period, according to Euromonitor.
This growth will be driven largely by rising demand for premium oud-based perfumes, fueled by increasing consumer spending.
Euromonitor also showed that premium menâs fragrances, many of which feature oud, are expected to be the fastest-growing category, aligning with a regional shift toward greater male investment in personal care. Arabian Oud Co. led the market in 2024, holding a 9 percent retail value share.
Before exploring oudâs transformation, itâs worth stepping back to understand the shifting dynamics of fragrance demand in the Gulf Cooperation Council, and what gives the region its uniquely bold scent identity.
Changes in demand for luxury fragrances in the GCC in recent years
The Gulf Cooperation Council region has long stood apart as deeply sophisticated when it comes to fragrance.
âBut what we are seeing today is a meaningful evolution, from passive consumption to informed appreciation,â Marco Parsiegla, CEO of Omani luxury fragrance brand Amouage told Arab News, adding: âClients are no longer simply buying perfumes; they are seeking stories, origins, and a sense of intentionality in what they wear. It is a fact that fragrance here is not an accessory; itâs an extension of personal identity and cultural heritage.â
Founded in 1983, Amouage is a luxury fragrance house known for its rich, oud-infused scents that blend Middle Eastern tradition with modern perfumery â and it is widely available in șÚÁÏÉçÇű through upscale retailers in cities like Riyadh and Jeddah.
To keep up with demand, Saudi oud exporters are also innovating in sustain-able sourcing.
Olivier de Cointet, senior adviser, consumer and retail at Arthur D Little
Parsiegla went on to underline that the marketâs growing maturity allows brands like Amouage to prioritize depth over trends. He explained that demand has shifted toward richer concentrations and limited, long-lasting creations.
âOur Exceptional Extraits, Attars, and Essences collection continue to perform exceptionally well in the GCC precisely because they reflect these values: rarity, intricacy, and permanence,â the CEO said.
âFor us at Amouage, this region is not a target market, itâs home. Itâs where our roots lie and where our vision is constantly challenged and refined. As we continue to expand globally, the GCC remains integral to how we define the meaning of high perfumery in a world that increasingly values quality, craftsmanship, and richness of expression,â Parsiegla added.
GCCâs distinctive scent profile
Parsiegla explained that for centuries, the region has maintained a strong connection to scent â where elements like oud, musk, and frankincense were more than commodities; they were cherished. This enduring bond with natural ingredients has cultivated a bold and distinctive scent identity.
âUnlike markets where perfumery is more seasonal or trend-driven, the GCC has developed its own codes such as layering, incense (Bakhoor), and oud which have been passed on through generations. These are not habits; theyâre traditions. And in that sense, the scent profile here reflects a lived aesthetic that values intensity, permanence, and resonance,â he said.
âAt Amouage, we donât approach this profile as outsiders. We were born into it. And what makes the GCC unique is not just the preference for bold or opulent compositions, but the discernment behind those preferences. Thereâs an expectation here that perfume should move you, intellectually, emotionally, even spiritually. Thatâs a high standard to meet, but also an inspiring one,â the CEO added.
Saudi artisans and the increasing global demand for oud
șÚÁÏÉçÇűâs oud makers and exporters are expanding to keep up with rising global demand â estimated at $6 billion a year, according to newsletter Aramco World â while preserving their traditional craftsmanship.
According to Olivier de Cointet, senior adviser, consumer and retail at Arthur D Little, traditional extraction methods continue to be central to oud production, with a strong commitment to preserving the rich, complex scent â described as earthy, animalic, and leathery â that has made it a prized luxury ingredient among perfumers globally.
The govern-mentâs export promotion arm is likewise opening doors abroad through training, trade missions, and support programs.
Sundeep Khanna, partner, consumer and retail at Arthur D Little
âTo keep up with demand, Saudi oud exporters are also innovating in sustainable sourcing. They have forged supply chains with Southeast Asian partners, and some major perfume houses invest directly in agarwood plantations abroad to secure high-quality supply. At home, new initiatives encourage cultivating Aquilaria trees on Saudi soil. For example, the project launched this year in Madinah to grow agarwood trees locally,â de Cointe said.
Vision 2030âs role transforming oud into a premium export
As part of Vision 2030, șÚÁÏÉçÇű has identified fragrances â particularly oud â as a key non-oil export to support economic diversification and generate employment opportunities.
From ADLâs side, Sundeep Khanna, partner, consumer and retail, explained that government efforts are enabling local fragrance brands to grow internationally and highlight Saudi artistry. In 2024, for example, Al-Majed for Oud became one of the first Saudi perfume companies to announce a public listing.
șÚÁÏÉçÇű is turning to cultivated trees and biotech solutions to safeguard supply. (AFP)
âThe governmentâs export promotion arm is likewise opening doors abroad through training, trade missions, and support programs â part of a broader push that lifted Saudi non-oil exports to a record SR515 billion in 2024,â Khanna said.
He added that a critical driver is Vision 2030 tying cultural heritage to economic value, with programs such as âYear of Handicrafts 2025.â
Growth, sustainability of șÚÁÏÉçÇűâs oud industry
Sustainability is now central to oudâs future, and ADLâs de Cointet highlighted that with wild agarwood at risk, șÚÁÏÉçÇű is turning to cultivated trees and biotech solutions to safeguard supply.
Government projects such as the Madinah farms aim to domesticate oud production, while global producers explore lab-grown methods to produce resin without harming natural forests.
âLooking ahead, collaborations with luxury brands are expected to further boost the Saudi oud industryâs visibility and sophistication. Saudi perfume houses increasingly work with renowned perfumers and luxury houses on exclusive editions and scent development,â he said.
Partnerships to boost oud value
Speaking on behalf of ADL, Khanna shed light on how șÚÁÏÉçÇű is tapping into partnerships with leading global fragrance houses, like Penhaligonâs 2024 AlUla launch, to elevate oudâs value and reposition it as a contemporary economic asset.
âșÚÁÏÉçÇű is also forging direct collaborations and knowledge exchanges with luxury brands to enrich its local industry. The National Museum in Riyadh recently hosted âPerfumes of the Eastâ â an international exhibition, with France as a key partner, that immersed visitors in Arab perfume heritage and included workshops by perfumers like Christopher Sheldrake,â he said.
The ADL partner added that such events connect Saudi artisans with global experts, spurring innovation in blending traditional oud oil with modern techniques.
Startups secure new backing to accelerate growth, scale technologies
Updated 27 September 2025
Nour El-Shaeri
RIYADH: Startup funding activity across the Middle East and North Africa region continues to show resilience, with fintech and artificial intelligence-focused ventures drawing significant investor interest.
From early-stage rounds to global expansion plays, startups across șÚÁÏÉçÇű, the UAE, Jordan, and Tunisia have secured new backing to accelerate growth, scale technologies, and strengthen digital infrastructure.
șÚÁÏÉçÇű-based fintech startup erad has secured $33 million in debt financing, marking Indian venture debt firm Stride Venturesâ first investment in the Kingdom.
The transaction, closed during Money20/20 Riyadh, included participation from other undisclosed investors.
Founded in 2022 by Salem Abu-Hammour, Faris Yaghmour, Abdulmalik Al-Meheini, and Youssef Said, erad offers Shariah-compliant, data-driven financing solutions to micro, small and medium-sized enterprises in șÚÁÏÉçÇű and the UAE.
The company claims to enable funding access within 48 hours. The new capital will be used to scale its platform and expand operations across both markets, with a focus on the retail, food and beverage, healthcare, and e-commerce sectors.
This latest round follows a $16 million pre-series A funding round which closed in April 2024 with backing from Y Combinator, Nuwa Capital, and others.
Stride Ventures plans $200m deployment in șÚÁÏÉçÇű
Stride Ventures has also announced plans to deploy $200 million in șÚÁÏÉçÇű over the next two years, signaling a significant push into the Gulf regionâs evolving financing landscape.
The firm is targeting a diverse range of companies across sectors and sizes, aligning with șÚÁÏÉçÇűâs economic diversification goals.
Additionally, Stride aims to invest $50 million into the UAEâs private credit market and has committed $500 million for broader Gulf investments over the next four years.
Tunisiaâs ANAVA commits $4m to Rasmal Innovation Fund I
Tunisiaâs ANAVA Fund of Funds has committed $4 million to Qatar-based Rasmal Innovation Fund I, a vehicle supported by the Qatar Investment Authorityâs $1 billion initiative.
The commitment aims to increase global venture capital access for Tunisian startups and strengthen links across the Middle East and North Africa startup ecosystems.
Rasmal Innovation Fund I targets $100 million in capital to invest in seed to series B-stage startups across fintech, B2B SaaS, healthtech, and logistics.
ANAVA, which is backed by the World Bank, KfW, and CDC, continues to deploy a fund-of-funds model to attract international fund managers and develop the local innovation economy.
Presight and Shorooq launch $100m A innovation fund
Presight, an AI-focused subsidiary of Abu Dhabiâs G42, has partnered with venture capital firm Shorooq Partners to launch a $100 million global innovation fund targeting AI ventures.
PresightâShorooq Fund I will invest in early to growth-stage startups in AI, machine learning, and smart cities, as well as energy, fintech, augmented and virtual reality, Industry 4.0, and deep tech.
PresightâShorooq Fund I will invest in early to growth-stage startups in AI, machine learning, and smart citie. (Supplied)
In addition to capital, the fund offers access to Presight and G42âs GPU infrastructure, secure data environments, and distribution channels.
The initiative seeks to position Abu Dhabi as a global hub for scalable and transformative AI solutions by pairing Presightâs technological capabilities with Shorooqâs investment expertise.
PayPal to invest $100m in Middle East and Africa
US-based digital payments company PayPal has announced plans to invest $100 million across the Middle East and Africa through a combination of minority investments, acquisitions, PayPal Ventures funding, and technology deployment.
The investment follows the recent opening of PayPalâs regional hub in the UAE, which aims to enhance digital commerce through improved payments, security, and international market access.
The initiative will build on PayPal Venturesâ previous investments in startups including Tabby, Paymob, and Stitch, and is positioned to help scale digital infrastructure while supporting regional entrepreneurs and small businesses.
Saudi fintech Bynow raises $1.2m from Merak Capital
Riyadh-based B2B fintech startup Bynow has secured $1.2 million in funding from Merak Capital to accelerate product development and support regional expansion.
Founded in 2022 by Rami Suliman and Ahmed Banafa, Bynow provides buy now, pay later solutions tailored for businesses, with a particular focus on small and medium-sized enterprises.
Founded in 2022 by Rami Suliman and Ahmed Banafa, Bynow provides buy now, pay later solutions tailored for businesses. (Supplied)
The company is developing tools to automate accounts receivable and payable processes.
The funding aligns with broader efforts under Vision 2030 to digitize financial services and enhance cash flow management across the SME sector.
Bwatech secures $16m to expand fintech services in șÚÁÏÉçÇű
șÚÁÏÉçÇű-based fintech Bwatech has raised $16 million in a funding round led by Sharaka Financial to fuel growth and deepen its presence in the Kingdomâs evolving digital finance sector.
Founded in 2020 by Rasha Al-Oraini and Hashem Al-Hekail, Bwatech offers a digital platform providing bank guarantees, account management, and open banking services accessible via web, mobile, and APIs.
Operating under the Saudi Central Bankâs regulatory sandbox, Bwatech aims to bolster corporate financial efficiency and contribute to the Kingdomâs broader digital infrastructure.
MoneyMoon raises $2.9m to scale P2P lending platform
Peer-to-peer lending platform MoneyMoon has raised $2.9 million in a pre-series A round led by Core Vision, with participation from family offices and angel investors.
The Saudi fintech startup will use the funds to enhance its technology stack and broaden access to Shariah-compliant short-term financing.
Founded in 2023 by Abdulmajeed Al-Askar, MoneyMoon operates under the Saudi Central Bankâs sandbox and offers Murabaha-based financing options.
The companyâs mission is to advance financial inclusion and support innovation in line with Vision 2030 objectives.
Sindbad Tech raises $4.8m seed round to scale fintech offerings
Saudi fintech firm Sindbad Tech raised $4.8 million in seed funding during Money20/20 Middle East, with the round led by Alkhabeer Capital.
The funding will support the companyâs expansion and continued development of financial solutions.
Founded in 2013 by Abdulaziz Al-Sultan, Mohammed Agbawi, and Ziad Aqbawi, Sindbad Tech evolved from a research initiative into a full-fledged fintech platform.
The company aims to improve transactional efficiency and contribute to șÚÁÏÉçÇűâs innovation and digital transformation agenda.
Jordanâs MADA secures $1.55m in pre-seed funding
Jordanian fintech MADA has raised $1.55 million in a pre-seed round led by Vision Ventures, with additional investment from D-Investments.
The company plans to use the funding to advance its platform and prepare for regional expansion.
Founded in 2018 by Mohammad Merie and Issa Ramadan, MADA offers buy now, pay later solutions and operates under the Central Bank of Jordanâs regulatory sandbox.
The startup seeks to offer flexible financing options while promoting financial inclusion and enhancing consumer access to digital credit products.
How Green Point transforms waste into sustainable gifts, recycles, and improves the environment in șÚÁÏÉçÇű
Rising food and plastic waste threaten the environment and public health
Updated 27 September 2025
Haifa Alshammari
RIYADH: Waste, be it food waste, plastic, or industrial byproducts, has severe negative effects on the environment, human health, and economies.
Globally, food loss and waste amount to more than 1 billion tonnes of all food produced every day, according to the statistics division at the United Nations. This crisis not only squanders water, land, energy, and labor but is also responsible for significant greenhouse gas emissions.
For example, food loss and waste contribute between 8 percent and 10 percent of global greenhouse gas emissions, also stressing land resources and biodiversity, as reported by the UN. Without urgent policy and behavioral changes, global waste generation is projected to grow dramatically.
This photo taken on June 19, 2025 shows residents throwing food waste into buckets next to a recycling collection truck in Taipei, Taiwan. (AFP)
According to the World Bank, solid waste is projected to increase by 70 percent by 2050 if urgent action is delayed, posing a threat to ecosystems, biodiversity, air quality, water quality, and human health.
In șÚÁÏÉçÇű, the scale of waste is also alarming. Saudis generate about 1.7 kilograms of waste per day for each person, according to 2023 study published by the , as the country produces about 7 million tonnes of plastic waste a year.
Food loss and waste in the Kingdom account for approximately 33 percent of the food produced, according to the same source, which corresponds to about 4 million tonnes annually, valued at approximately SR40 billion ($10.6bn)
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However, according to a 2024 report by the Saudi Press Agency, șÚÁÏÉçÇű is moving to address these issues, as the ministry of environment, water, and agriculture has set ambitious targets to recycle up to 95 percent.
Additionally, the country aims to eliminate 82 percent of existing waste sites by 2035 as part of its push toward a circular economy model, as earlier reported in the Saudi
Such efforts demonstrate how the Kingdom is taking increasingly serious steps to reduce single-use plastics, promote recycling, and transform waste into value. One of the green methods to minimize waste is recycling materials into gift products.
Muhammed Tantawy, chief marketing officer of Green Point, in an interview explained how the Saudi-based company is helping organizations shift from wasteful practices toward meaningful, sustainable alternatives, especially in the domain of gift items.
Green Point transform pineapple skin into notebooks and leather keychains, and apple peels into vegan Polyurethane leather, which makes it a green alternative to animal-derived leather. (Supplied)
âA forward-thinking company dedicated to providing innovative and sustainable corporate gifts and solutions ... helping organizations adopt environmentally responsible practices by providing products that are functional, high-quality, and eco-friendly," said Tantawy, outlining Green Pointâs core values.
According to him, the company values being built revolve around sustainability, innovation, and ethical sourcing. The company prioritizes recycled, renewable, and biodegradable materials to minimize waste, while promoting conscious consumption. This approach enables Green Point to avoid becoming another source of waste and focus on being part of the solution.
Some of Green Pointâs sustainable gifts are produced locally, such as essence burners made from natural bamboo, which they believe is the only truly sustainable and eco-friendly wood. Another item made from recycled cotton, or felt, is a tote bag.
"Green Point contributes to building a greener, more sustainable future in line with the Kingdom's ambitious vision." Said Muhammed Tantawy, Chief Marketing Officer of Green Point. (Supplied)
Yet, what is more impressive is how the company recycles organic waste, which benefits the environment and is biodegradable.
For example, pineapple skin is transformed into notebooks and leather keychains, and apple peels into vegan polyurethane leather, which makes it a green alternative to animal-derived leather.
The company also processes coconut shells into bowls and cups, in addition to converting coffee beans into vegan leather substitutes.
DID YOU KNOW?
âą Food loss and waste in the Kingdom account for approximately 33 percent of the food produced daily.
âą șÚÁÏÉçÇű is working to tackle food-waste issues through the Ministry of Environment, Water, and Agriculture, setting ambitious targets to recycle up to 95%.
âą On a global scale, food loss and waste result in the waste of more than 1 billion tonnes of food a day, according to the UN.
But what makes Green Point align with Saudi Vision 2030 and the Kingdomâs sustainability goals is how the company supports the national agenda, Tantawy said.
According to him, they are âprioritizing eco-friendly and locally sourced materials and offering solutions that reduce single-use plastics and general waste.â
Even further, the CMO discussed one of their responsibilities towards a greener future, as they are promoting sustainability more broadly by educating clients about the environmental value of their products. This approach involves not just selling an item, but also raising awareness.
âGreen Point contributes to building a greener, more sustainable future in line with the Kingdomâs ambitious vision,â Tantawy said.
They also process coconut shells into bowls and cups, in addition to converting coffee beans into vegan leather substitutes. (Supplied)
Overall, șÚÁÏÉçÇűâs Vision 2030 is not only focused on economic diversification and infrastructural development; it also emphasizes environmental sustainability while ensuring the establishment of a circular economy.
Because the Kingdom is committed to reducing plastic waste, promoting recycling and restoring degraded lands, and more importantly, increasing environmental awareness throughout society, Green Point illustrates how the private sector can play a role in the transformation process, by using waste and turning it into gift products, keeping practices green as well as ethical.
Through a sustainable approach, the company demonstrates that gifts are not only an expression of gratitude or celebration, but also an expression of care for the environment and the overall community in the Kingdom.
KARACHI: Pakistan is planning Saudi-linked port and shipping projects, including new gateway terminals, direct shipping routes and green ship recycling yards, as part of efforts to become a logistics bridge between the Gulf, Central Asia and China, the maritime ministry said on Friday.
Officials say Pakistanâs location at the mouth of the Arabian Sea gives it a strategic advantage in connecting Gulf energy exporters with China and the landlocked markets of Central Asia.
With GulfâChina trade volumes rising and regional shipping routes expanding, Islamabad is seeking to position its ports as key nodes in emerging transport corridors.
According to a statement from the maritime ministry, Technical Adviser for Maritime Affairs Muhammad Jawad Akhtar proposed several new projects with șÚÁÏÉçÇű.
These included âKarachiâKSA and GwadarâKSA Gateway Terminals, expansion of the Pakistan National Shipping Corporation fleet under Saudi partnership, start direct shipping lines from Karachi to Jeddah and Gwadar to Dammam, and establish 20 green ship recycling yards at Gaddani,â the maritime ministry statement said.
Karachi Port and Port Qasim â Pakistanâs two largest and busiest seaports handling most of the countryâs container and cargo traffic â along with Gwadar Port, a Chinese-developed deep-sea port near the mouth of the Arabian Gulf, are seen as key to these plans.
Maritime Affairs Minister Muhammad Junaid Anwar Chaudhry said the effort was part of a broader plan to integrate Pakistanâs ports and logistics infrastructure with regional trade routes.
âWe are not merely compiling lists of projects; we are shaping a national roadmap for logistics and connectivity,â he said.
âPakistan performs best under compressed timelines, and this is one such moment.â
Chaudhry said Karachi Port, Port Qasim and Gwadar Port would be central to the plan, which aims to link them to regional transport corridors through rail, road and air networks.
He highlighted the importance of the long-delayed ML-1 railway modernization project â a planned multi-billion-dollar upgrade of Pakistanâs 150-year-old main railway line from Karachi in the south to Peshawar near the Afghan border â expected to boost freight and passenger traffic from the northwest province of Khyber Pakhtunkhwa to southern ports.
He said Pakistan must align its development agenda with the connectivity needs of partner countries.
Chaudhry added that a joint working group bringing together the maritime, communications, railways and defense ministries would hold its first meeting next week to shortlist priority projects for rapid funding and development.
Other ministries outlined their own connectivity priorities. The communications ministry called for laying fiber optic cables along railway lines, expanding submarine cable networks and speeding up completion of the M-6 motorway â a 394-km section of Pakistanâs northâsouth highway network linking the port city of Karachi to Sukkur in interior Sindh province â described as a missing link in the ChinaâPakistan Economic Corridor (CPEC), a multibillion-dollar infrastructure and energy program that is part of Chinaâs Belt and Road Initiative.
The communications ministry also highlighted plans for an M-10 motorway extension through the Khirthar mountains in southern Pakistan to complement existing road infrastructure.
A petroleum ministry representative said a $300 million feasibility study was underway for a new merchant oil terminal at Hub, an industrial town near Karachi, as part of Pakistan State Oilâs infrastructure expansion strategy.
Chaudhry urged ministries to deliver a clear, investment-ready roadmap that would attract international financing and cement Pakistanâs role as a âcentral bridgeâ connecting the Gulf with Central Asia and China.
Saudi finance firmsâ credit up 10% as non-bank lending sector grows
Finance companies have become pivotal in expanding credit access to Saudi consumers and SMEs
Individual finance accounted for the largest share of total credit facilities
Updated 26 September 2025
Dayan Abou Tine
RIYADH: Saudi finance companiesâ outstanding credit reached SR99.37 billion ($26.5 billion) at the end of the second quarter of 2025, marking a 10.2 percent increase compared to the same period last year.
According to latest data from the Saudi Central Bank, also known as SAMA, this figure represents only about 3.12 percent of the total financing extended by the Kingdomâs commercial banks, underscoring the still-modest but growing footprint of non-bank lenders in the financial system.
Personal loans and auto financing dominated the portfolio of these companies, reflecting their consumer-centric focus. Individual finance accounted for the largest share at around 29 percent of total credit facilities, roughly at SR28.7 billion.
Auto financing was the second-biggest segment at about SR25.93 billion, followed closely by residential real estate loans, which comprised 23 percent or approximately SR23 billion of the total.
Other, smaller lending activities registered even faster year-on-year growth, albeit from a lower base. Credit card finance, for instance, jumped by about 31.5 percent over the year to reach SR2.12 billion, making it one of the fastest-growing segments.
Commercial real estate financing also saw a robust annual uptick of 22.8 percent, climbing to SR5.66 billion, as finance companies increasingly catered to property developers and businesses outside the traditional banking sector.
Loans classified under âotherâ rose by 14 percent to SR14.04 billion. This broad-based growth across categories indicates strong borrower appetite and an expanding role for finance firms beyond their core personal and auto loan offerings.
According to SAMAâs breakdown, the retail sector took the lionâs share of finance company lending, accounting for about 77 percent of total outstanding credit by these firms.
SAMA had noted in 2024 in its Financial Stability Report that such concentration presents a risk exposure, though roughly half of those retail loans are to public sector employees with stable incomes, which helps mitigate default risk.
Support for businesses â especially smaller enterprises â is a significant part of finance companiesâ mission. Micro, small, and medium-sized enterprises together received nearly 19 percent of finance company credit as of the quarter, which is nearly double the proportion that SMEs typically represent in bank lending portfolios.
This underscores how non-bank lenders are closing the SME financing gap and supports Vision 2030âs diversification agenda, which seeks to broaden consumer and SME access to credit and lift SMEsâ share of bank lending to 20 percent by 2030.
By contrast, large corporates outside the SME category accounted for only about 4.4 percent of finance company credit, as big firms continue to rely mostly on banks or capital markets for their funding needs.
Key role for consumers
Finance companies have become pivotal in expanding credit access to Saudi consumers and SMEs, complementing banks by serving niche segments and underserved borrowers.
Though their loan book is only a fraction of the size of banksâ, Saudi finance companies play an outsize role in financial inclusion. They are non-deposit-taking institutions that often serve niche markets and borrowers not fully reached by traditional banks.
In recent years, these firms have been instrumental in extending credit to underserved segments â from lower-income individuals seeking personal or installment loans, to entrepreneurs and small business owners who may lack the collateral or credit history to obtain bank financing.
The growing activity of finance companies, alongside new fintech lending platforms, is viewed as crucial to bridging this gap.
These non-bank finance firms also complement banks by taking on business models that banks might not pursue, such as leasing, microfinance, and buy now, pay later services.
As most Saudi finance companies are not allowed to take customer deposits, except in limited cases with SAMAâs prior approval, they fund their books largely through shareholder capital and wholesale funding which are bank credit lines and, where approved, sukuk or bond issuance, supplemented by retained earnings.
This structure tends to make their cost of funds higher than deposit-funded banks, so pricing and product design are calibrated to risk and speed, especially in the consumer, auto, and SME niches where exposures are often partially unsecured.
Their presence introduces more competition and choice in the credit market, provifing consumers with additional options for car loans or credit cards, and offering small businesses alternative financing when bank loans are out of reach.
Even though these companiesâ overall market share is small, their impact on niche lending segments is significant, providing tailored financial solutions that complement the services of mainstream banks.
Their rapid growth in recent years has been underpinned by regulatory reforms and fintech innovation.
SAMA leading the way
SAMA has actively encouraged the expansion of this sector as part of the Financial Sector Development Program. A notable step came in January 2023, when the regulator halved the minimum paid-up capital requirement from SR100 million to SR50 million for new finance companies focusing on SME lending.
This move aimed to attract investors and enable more specialized lenders to launch operations targeting small businesses. Additionally, SAMA opened the door for new business models by licensing the first debt-based crowdfunding platforms and setting a low SR5 million capital threshold for BNPL providers, fostering a wave of fintech entrants.
Since 2022, rules have also been eased to allow finance companies to engage in multiple financing activities, such as consumer finance, real estate lending, and SME finance under one roof, rather than be restricted to a single line of business.
As a result of the pro-growth regulatory environment, the number of licensed finance companies in the Kingdom has climbed significantly. By the end of 2024, SAMA had authorized 62 finance companies operating across personal finance, mortgage, leasing, and fintech lending segments.
That momentum has continued into 2025 with SAMAâs latest licensing notice in September stating that, with the licensing of Muhlah Zamaniyah for consumer microfinance, âthe total number of finance companies licensed by SAMAâ reached 68.
Looking ahead, Saudi finance companies are poised for further expansion in line with the Kingdomâs Vision 2030 ambitions. Their agility in deploying fintech solutions, from instant consumer loans via mobile apps to revenue-based financing for startups, gives them an edge in reaching customer segments that value speed and flexibility.
At the same time, prudent oversight by SAMA, including updated governance and risk management frameworks, is helping ensure the sector grows sustainably.
With continued policy support and innovation, these non-bank lenders are set to deepen their role in șÚÁÏÉçÇűâs credit market, gradually increasing their 3 percent slice of the pie while empowering more consumers and entrepreneurs with access to financing.
