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Market Size and Growth
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Market SizeThe Saudi Arabian automotive finance market was valued at several billion USD, with estimates suggesting it could reach up to USD 10 billion or more by the end of the decade, depending on economic conditions and consumer demand.
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Growth RateThe market has been growing at a compound annual growth rate (CAGR) of around 5-10% over the past few years.
Saudi Arabia automotive loan market is expected to witness robust growth over the duration of the forecast period owing to the population's growing awareness regarding automotive loans, customer preferences and likings, and the implementation of favorable government laws and regulations. Moreover, the increasing prices of automobiles has made owning a vehicle very challenging, which is driving the Saudi Arabia automotive loan market. As a result, it stands to reason that more people are using automotive loans to finance the purchase of new vehicles, which is expected to fuel the expansion of automotive loans market in Saudi Arabia during the forecast period.
Automotive loans are loans given to customers who want to own a vehicle through funds provided by banks and financing companies in Saudi Arabia, provided that the customer pays the amount of the loan and the loan costs in convenient monthly instalments for a certain period of time. Additionally, automotive loan is primarily provided through banks, NBFCs (non-banking financial companies, OEM (original equipment manufacturer), others (fintech companies) over a specified tenure and interest rate.
According to International Trade Administration data, among Middle East/North Africa (MENA), Saudi Arabia is the leading regional market with 36% share of electric vehicles. In 2020, Saudi Arabia accounted for over 52% of the vehicles sold in the GCC and 35% in the MENA region. According to the latest reports of Saudi Statistics Bureau, the number of cars in Saudi Arabia exceeded twelve million and by mid-2022, the population of the Kingdom of Saudi Arabia have surpassed 35 million people. As a result, it may be stated that every third Saudi citizen owns a vehicle and thus with the rising share of people owning a car, is expected to drive the automotive loan market in Saudi Arabia.
Digitalization of Financial Institution is Fueling the Market Growth
Automotive loan industries are progressively adopting more advanced Insulation developments to boost operational profitability along with client satisfaction. Moreover, fintech companies are new competitors to traditional financial services in the Saudi Arabia auto lending sector that are boosting the demand for the automotive loan industry in Saudi Arabia. As the number of private fintech companies in the Saudi Arabia automotive finance market is increasing, more people are shifting from the government to private automotive loan industries.. Therefore, the traction towards online platforms has led to banks, finance companies and car brands listing their fleet online along with the option to start loan applications online is expected to drive the growth of Saudi Arabia automotive loans market during the forecast period.
Surging Demand of Vehicles in Saudi Arabia Fuels Market Growth
The demand for vehicles is increasing in Saudi Arabia with the increased demand for connected vehicles and ongoing digital transformation. Additionally, the entrance of female drivers to the market is anticipated to boost the number of vehicles sold overall, which will have a positive impact on the automotive loan market in Saudi Arabia. In Saudi Arabia, two-wheelers are considered a Luxury item rather than a means of transportation, and four-wheelers are preferred more often. As the prices of cars are increasing, the consumers are expected to avail of automotive loans to make the purchase, which is expected to drive the Saudi Arabia automotive loan market..
Benefits of Automotive Loan Fuels Market Growth
The automotive loan is one of the most popular loan types in Saudi Arabia as people prefer to buy a vehicle with an automotive loan as it doesn’t require any guarantor. Additionally, one can obtain an automotive loan the same day as applying if all necessary bank documents are completed. Companies are offering financing up to a maximum percent of the estimated value of the car with a competitive interest rate. The automotive loan makes it simple for customers to get the vehicle they want and is the best pick for those who would like to purchase a vehicle with monthly payments. Thus, the automotive loan market has been driven by the benefits of the automotive loan.
Market Segmentation
The Saudi Arabia automotive loan market is segmented on the basis of vehicle type, provider type, percentage of amount sanctioned, and tenure. On the basis of vehicle type, the market is divided into two-wheeler, passenger cars, and commercial vehicles. Based on the provider type, the market is segmented into banks, NBFCs (non-banking financial companies, OEM (original equipment manufacturers), and others (fintech companies). Based on the percentage of amount sanctioned, the market is segmented into less than 25%, 25-50%, 51-75%, and more than 75%. On the basis of tenure, the market is segmented into less than 3 years, 3-5 years, and more than 5 years.
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Company Profiles
Al Rajhi Banking & Investment Corp., Riyad Bank, National Commercial Bank, Abdul Latif Jameel United Finance Company, The Saudi Investment Bank, Arab National Bank, Saudi Finance Company, AL AMTHAL Finance Company, Alinma Bank, and Emirates NBD PJSC are some of the major market players that are driving the growth of the Saudi Arabia automotive loan market.
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Attribute |
Details |
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Base Year |
2022 |
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Historical Years |
2018 – 2021 |
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Estimated Year |
2023 |
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Forecast Period |
2024 – 2028 |
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Quantitative Units |
Revenue in USD Billion and CAGR for 2018-2022 and 2023-2028 |
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Report Coverage |
Revenue forecast, company share, competitive landscape, growth factors, and trends |
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Segments Covered |
Vehicle Type Provider Type Percentage of Amount Sanctioned Tenure Region |
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Regional Scope |
Western, Central & Northern, Eastern, Southern |
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Key Companies Profiled |
Al Rajhi Banking & Investment Corp., Riyad Bank, National Commercial Bank, Abdul Latif Jameel United Finance Company, The Saudi Investment Bank, Arab National Bank, Saudi Finance Company, AL AMTHAL Finance Company, Alinma Bank, Emirates NBD PJSC |
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Customization Scope |
10% free report customization with purchase. Addition or alteration to country, regional & segment scope. |
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Pricing and Purchase Options |
Avail of customized purchase options to meet your exact research needs. Explore purchase options |
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Delivery Format |
PDF and Excel through Email (We can also provide the editable version of the report in PPT/pdf format on special request) |
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