BNPL Adoption Surges in Saudi Arabia as Electronic Payments Reach 70% of Retail Transactions

The Saudi Arabia buy now pay later market is poised for robust expansion, with the market size estimated at USD 1.5 billion in 2025 and projected to reach USD 2.84 billion by 2032, growing at a compound annual growth rate (CAGR) of 9.8% between 2026 and 2032.

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This surge is propelled by the kingdom’s rapid digital transformation, increasing smartphone penetration, and a rising preference for flexible payment options among its youthful population.

The Saudi government’s Vision 2030 initiative has accelerated the adoption of digital financial services, with electronic payments now accounting for 70% of all retail transactions in 2024. This shift toward cashless payments has created favorable conditions for BNPL platforms to thrive, aligning with the nation’s broader strategy to develop a robust, technology-driven economy.

E-commerce and Demographic Momentum Fuel Market Growth

Saudi Arabia’s e-commerce revolution has become a cornerstone of BNPL adoption. According to the CST Commission, 63.7% of internet users purchased products or services online in 2023, with women accounting for 74.6% of those transactions. This trend has been bolstered by the integration of BNPL solutions into leading platforms such as Noon, Amazon.sa, and local digital marketplaces.

The market is further supported by favorable demographics — over 70% of the Saudi population is under the age of 35. Millennials and Gen Z consumers are driving BNPL uptake as they seek transparent, interest-free payment options that align with Shariah-compliant principles. With credit card penetration at only 27.7%, BNPL offers an attractive alternative for this digitally savvy generation.

Market Segmentation Highlights

• Channel: The online segment dominates with 80% share in 2025, while Point-of-Sale (POS) BNPL is set to register the fastest growth during 2026–2032.
• Business Model: Pay-in-4 leads with 45% share, appealing to consumers with short-term, interest-free payments. Long-term instalment plans are the fastest-growing model, supporting higher-value purchases.
• Provider Type: Local BNPL firms such as Tamara and Tabby command 45% market share, leveraging their Shariah-compliant models and deep cultural understanding. International entrants like Klarna, Afterpay, and Affirm are expected to grow rapidly during the forecast period.
• Demographics: Millennials represent the largest user group (45%), while Gen Z is the fastest-growing segment. Female consumers account for a dominant 85% share, reflecting their strong engagement in fashion and personal care purchases.
• Regional Insights: Al-Riyadh leads the market with 40% share, while Makkah Province, driven by religious tourism and Jeddah’s commercial activity, is projected to grow at a CAGR of 10.5% through 2032.

Industry and Competitive Landscape

The BNPL ecosystem in Saudi Arabia is highly fragmented, with active players including Tamara Finance Company, Tabby FZ LLC, Zip Co Limited, Jeel Pay, Kadi Pay, MIS Forward, Spotti, Postpay, Arabian Pay, ToYou, and Madafuou Alarabia.
Recent market activity highlights the sector’s momentum:

• March 2025: Arabian Pay secured pre-seed funding from Al Bassami Holding Group to accelerate platform expansion.
• September 2024: Tabby acquired Tweeq International Company, strengthening its position in digital payments.
• January 2024: Tamara Finance Company acquired PayTabs, enhancing its technological infrastructure and merchant processing capabilities.

Key industries embracing BNPL include fashion & personal care (35% market share), consumer electronics, and healthcare, the latter projected to be the fastest-growing vertical as medical providers adopt zero-interest instalment options for patients.

BNPL: A Financial Evolution Aligned with Vision 2030

The rising adoption of BNPL services in Saudi Arabia underscores the nation’s transition toward a cashless, inclusive, and innovation-led economy. With contactless payments reaching 94% penetration and over 33 million smartphone users, the Saudi market presents a fertile environment for fintech innovation.

As BNPL solutions continue to integrate with e-commerce and retail ecosystems, the sector is set to play a pivotal role in empowering consumers, boosting retail sales, and supporting Saudi Arabia’s digital financial transformation under Vision 2030.