Who are the Fierce Competitors of Saudi Banks?

Here’s Why Financing Platforms Are Growing in Saudi Arabia

Banks charge fees if customers belonging to different banks transfer money to each other. E-wallets charge nothing for money transfers.
Banks charge fees if customers belonging to different banks transfer money to each other. E-wallets charge nothing for money transfers.

Who are the Fierce Competitors of Saudi Banks?

The Saudi banking sector is facing new competitors. The competition is coming from fintech (financial technology) and financing firms that are taking a slice of the banking business. The accelerating growth of the digital services and new competitors has brought down the number of banks’ branches from 2014 in year 2020 to 1945 branches currently, decreasing by 3.5%. The number of bank employees has continued to fall steadily since 2015 from 49563 employees to 46049 employees now. The number of banks’ remittance services centers has gone down from 752 centers in 2017 to 704 centers in 2021.  

What going on in the Saudi banking sector? Who are those competitors?


Less than two years ago, a couple of buy-now-pay-later companies: Tamara & Tabby were licensed by the Saudi Central Bank (SAMA). They provide credit solutions with an extended period for re-payment without interest in cooperation with a growing base of vendors.

Customers, who don’t prefer credit cards’ interest or can’t afford to buy something they want instantly, can apply easily. The buy-now-pay-later can easily check the credit record of the customer and give them a 3 or 4-month re-payment plan without imposing interest.

How do they make profits? They get a cut from their partner vendors without having customers pay anything extra. This solution is taking a slice from the banks’ credit customers.


There are 4 e-wallets that are licensed by SAMA including STC Pay, Inma Pay, Hala & Loop. They can be used to transfer small amounts of money (from as low as a single halala up to SR 20,000) between individuals using their phone numbers as an identifier.

Those wallets offer rechargeable VISA cards to their customers and are acceptable as a payment solution that is accepted by many vendors.

Banks charge fees if customers belonging to different banks transfer money to each other. E-wallets charge nothing for money transfers. Users can transfer money from their e-wallets to bank accounts and charge them using credit and debit cards, meaning those wallets benefit from the existing banking environment while competing with the same system.

It is worthy noting that the biggest Saudi e-wallet, STC Pay, is in the process of transformation into a digital, branchless bank after being granted a license by SAMA last year. More digital banks mean more competition to traditional banks.

International Money Transfer Platforms

In 2021, expats transferred USD 41.03 billion to their dependents overseas. Banks or companies related to banks used to be the only way to transfer money internationally. In the past few years, companies like WU or SPL (Saudi Post) in addition to e-wallets have made it possible for individuals to transfer money using Apps. This means lost revenues for banks that charge transfer fees for each transaction.

The average cost for each international transfer is USD 5.5. With more workers in the Kingdom being digitally literate, it is expected that the dependence on international money transfer platforms will increase. That’s why banks have taken special care to develop their apps to make it even easier for bank account holders to transfer money internationally. The main competition now revolves around charging less fees.


There are over 40 licensed financing companies that provide loans to small and Medium enterprises (SME) and individuals. The credit products they provide are diversified as there are companies that are specialized in residential loans, consumer loans, car loans, etc.

Those financing companies provide more options for individuals and companies alike with more competitive interest rates and easier conditions.

(Photo: Pixabay)



Crowdfunding means raising small amounts of capital from a large number of individuals to finance new ventures or expand existing ones.

There are currently 8 SAMA-licensed companies that provide crowdfunding services. Those platforms give individuals investment opportunities away from banks. Those individuals make profits when the companies are sold to a new investor or get listed in the stock market.


More e-trading non-bank platforms are competing with bank platforms to get a bigger audience base. Many platforms are based in Saudi Arabia, others are foreign platforms that are licensed by the Saudi Capital Market Authority (CMA).

Those e-trading platforms compete with banks by charging less for transactions with easier access to international stock markets.  


If we take each competitor individually, we will notice that their revenues or market share is small compared to banks; however, if they are taken together into consideration, we will find that they need to be taken more seriously by banks. This means that banks need to invest more in Fintech, ease restrictions on individuals and charge fees to avoid customer and revenue leakage.

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