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The Saudi Central Bank, known as SAMA has released its July 2025 financial and banking sector bulletin, highlighting continued resilience across key indicators despite global economic volatility.
Money supply (M3) grew by 8.36 percent year on year, driven mainly by a 20.75 percent surge in time and savings deposits. The rise reflects stronger public awareness of the importance of saving and investing to secure future financial needs.
Saudi banks, guided by SAMA, have been instrumental in fostering this trend, supported by a recent Ministry of Finance and National Debt Management Center initiative — launched with SNB Capital — to introduce individual savings sukuk. The program aims to help citizens build sustainable financial plans while deepening private-sector partnerships.
Meanwhile, money in circulation recorded a 7.61 percent annual increase in July, even as electronic payments continued to dominate. Digital transactions accounted for 79 percent of retail payments in 2024, up from 70 percent in 2023, surpassing the Vision 2030 target and underscoring progress under the Financial Sector Development Program toward a cashless economy.
The Kingdom’s shift toward a cashless society has been driven by SAMA’s efforts to expand electronic payment channels, supported by the rapid growth of e-commerce and a sharp rise in point-of-sale infrastructure.
Since the launch of Vision 2030 in 2016, electronic payments have gained strong momentum, reflecting both rising consumer adoption and the broader digital transformation of the financial sector. By July 2025, the number of point-of-sale terminals exceeded 2.1 million, compared with 1.8 million a year earlier — a clear sign of deeper integration of digital payments among businesses and consumers alike.
E-commerce transactions using “mada” cards continued their steep climb in July 2025, underscoring the Kingdom’s rapid transition toward a digital-first, less-cash economy. Total sales reached nearly SR30 billion ($8 billion), up from SR16.6 billion a year earlier — a surge of more than 79 percent. The number of transactions also jumped to about 150 million, compared with 90 million in July 2024. This strong growth reflects not only rising consumer confidence in digital platforms but also the growing role of e-commerce in everyday spending. It further highlights the success of national initiatives aimed at driving digital transformation and financial inclusion under Saudi Vision 2030.
Complementing this momentum, SAMA’s recent regulatory update on credit card issuance and operations marks a key step toward enhancing payment efficiency. The reforms are designed to improve transparency, reduce consumer costs, and encourage broader adoption of digital and alternative payment methods among residents and international visitors alike — in line with Vision 2030 objectives.
These achievements build on strategic initiatives led by SAMA in partnership with the financial sector to strengthen the payments ecosystem and expand access to secure, innovative, and inclusive financial solutions across the Kingdom.
The Kingdom’s shift toward a cashless society has been driven by SAMA’s efforts to expand electronic payment channels, supported by the rapid growth of e-commerce and a sharp rise in point-of-sale infrastructure
Talat Zaki Hafiz
Saudi reserve assets posted a modest year-on-year decline of 1.93 percent in July 2025 compared with the same period in 2024.
Despite this dip, the banking sector continues to show strong performance, supported by a solid asset base, stable liquidity, and effective regulatory oversight. Capital adequacy ratios stood at 19.3 percent in the first quarter of 2025 — well above the required threshold — underscoring the sector’s resilience and compliance with international standards.
While deposit growth lagged behind credit expansion, pushing the loan-to-deposit ratio to 81.85 percent in July 2025 from 80.73 percent a year earlier, banks maintained their ability to finance private sector activity. Bank claims on the private sector rose 17.72 percent year on year, reaching approximately SR3.1 trillion, reflecting the sector’s continued strength in supporting economic growth under evolving market conditions.
Mortgages maintained their upward trajectory in the second quarter of 2025, reaching approximately SR933 billion, a 14.5 percent increase from SR815 billion in the same period last year. This sustained expansion underscores the banking sector’s active role in housing finance, which has been instrumental in boosting homeownership among Saudi citizens.
The homeownership rate stood at 65.4 percent in 2024, surpassing the original 2025 target of 65 percent. This achievement supports Vision 2030’s goal of raising homeownership to 70 percent by the end of the decade and highlights the close alignment between financial sector development and national housing objectives.
To safeguard liquidity, SAMA continues to act as lender of last resort, providing overnight facilities and conducting weekly open market operations to reinforce monetary stability.
The July 2025 bulletin underscores the resilience of ’s financial system, with steady growth in assets, lending, and digital payments. These advances highlight not only the strength of the banking sector but also its expanding role in driving the Kingdom’s economic transformation. As Vision 2030 initiatives gather pace, the sector is emerging as a key enabler of diversification, supported by robust regulation, rising financial inclusion, and a proactive approach to innovation and risk management. Collectively, these factors provide a solid foundation for sustaining long-term growth and navigating global economic headwinds.
The 2025 IMF Article IV consultation echoed this view, commending the banking sector’s strong performance, capitalization, and profitability. Both the aggregate regulatory capital ratio and Tier 1 capital ratio remain above 19 percent, while asset quality has improved significantly, with nonperforming loans falling to 1.2 percent of total loans — the lowest level since 2016.
• Talat Zaki Hafiz is an economist and financial analyst. X:@TalatHafiz