Saudi Arabia’s sustainable desalination strategy

RIYADH: Credit provided by finance companies in Saudi Arabia rose to SR96.26 billion ($25.67 billion) in 2024, marking a 13.6 percent increase compared to the previous year, according to the latest figures from the Saudi Central Bank.  

Personal finance led the way, accounting for 29 percent of total lending, or SR27.6 billion. Auto financing followed closely at 26 percent (SR25.16 billion), while residential real estate loans comprised 24.27 percent, amounting to SR23.36 billion.  

Although it represents a smaller share of total lending, credit card finance recorded the most significant growth, surging 52.4 percent year on year to SR1.92 billion.   

Commercial real estate financing also saw robust expansion, rising 20 percent to SR4.92 billion. Auto and personal loans maintained solid momentum, growing by 18.8 percent and 18.6 percent, respectively. 

The retail segment — including personal, auto, housing, and credit card financing — continued to dominate the portfolios of finance companies in 2024. Lending to micro, small, and medium-sized enterprises also played a key role, representing approximately 19 percent of total credit. This is nearly double the share of MSME lending seen among traditional banks. 

In contrast, financing for large corporations remained limited, as major firms continued to rely on bank loans or capital markets to meet their funding needs. 

Profitability in the sector also improved markedly according to SAMA data. Net income rose by 72.13 percent to SR2.86 billion, while return on assets increased from 2.59 percent in 2023 to 4.13 percent in 2024. Return on equity reached 9.58 percent, up from 6.97 percent the previous year. 

Together, these trends indicate growing confidence in the sector, increased borrower demand, and improved cost management — factors that position finance companies for further expansion, particularly in underserved and fintech-driven lending segments. 

In recent years, finance companies in Saudi Arabia have played an increasingly important role in expanding credit access, particularly for underserved segments such as SMEs and individuals outside the traditional banking network. 

The expansion of finance companies in Saudi Arabia has been bolstered by regulatory reforms aimed at promoting financial inclusion and boosting competition. A significant milestone came in January 2023, when SAMA amended Article 8 of the Implementing Regulation of the Finance Companies Control Law, lowering the minimum paid-up capital requirement for firms focused on financing SMEs to SR50 million. The move was intended to attract investors and encourage the launch of specialized finance firms serving the SME sector.  

In a further push to support fintech innovation aligned with the Kingdom’s Vision 2030, SAMA also set a minimum capital threshold of SR5 million for Buy-Now-Pay-Later providers. 

These policy changes have led to a noticeable uptick in market participation. By the end of 2024, SAMA had licensed 62 finance companies operating across various segments, including personal finance, mortgage lending, leasing, and fintech-based services.  

Despite representing just 3.26 percent of total lending in Saudi Arabia — compared to SR2.96 trillion in bank loans — finance companies are playing an increasingly vital role in the Kingdom’s financial ecosystem.   

Unlike commercial banks, which benefit from extensive deposit bases and corporate lending capacity, finance companies are non-deposit-taking institutions that often serve niche or underserved markets.  

Interest rates offered by finance companies typically exceed those of traditional banks, reflecting differences in funding sources and borrower risk profiles.   While banks draw from low-cost deposits and operate with greater economies of scale, finance companies depend on equity, interbank loans, or capital markets for funding.  

As a result, their annual percentage rates tend to be higher, especially when serving higher-risk customer segments. 

Fintech expands footprint 

Saudi Arabia’s finance sector is evolving rapidly, with the emergence of fintech-driven players complementing traditional non-bank lenders.  

Among the most notable additions to the landscape are debt-based crowdfunding platforms, which are regulated by SAMA under the finance companies’ framework. 

Unlike conventional finance companies such as Nayifat or Bidaya, which lend directly using their own capital and assume full credit risk, these platforms act as intermediaries.  

They connect retail or institutional investors with borrowers — often micro and small enterprises — allowing investors to fund loans directly. The platforms themselves earn fees for facilitating the transactions, while the credit risk is borne by the investors, not retained on the platform’s balance sheet. 

This innovative model is helping to bridge financing gaps for SMEs and underserved communities, in line with the Vision 2030 objective of expanding financial access and economic participation. 

In a related move that highlights the sector’s momentum, Tamara Finance Co. became the latest company to receive SAMA licensing in March, bringing the total number of licensed finance companies in the Kingdom to 65.  

The company was approved to offer consumer finance and BNPL services, further reinforcing SAMA’s commitment to fostering financial innovation. 

Tamara, Saudi Arabia’s first fintech unicorn, achieved a $1 billion valuation in 2023 following a $340 million Series C funding round. Its rise coincides with a sharp increase in BNPL adoption across the Kingdom. 

A 2024 report by rival platform Tabby revealed that 77 percent of Saudi consumers now use BNPL services — often for essential expenses such as education, healthcare, and insurance — challenging the perception that BNPL is primarily for discretionary spending.  These developments underscore SAMA’s broader strategy to diversify credit sources, enhance consumer access to financing, and drive the shift toward a digital, cashless economy under Vision 2030.

RIYADH: Saudi Arabia is fast positioning itself as a regional pioneer in artificial intelligence-driven healthcare, harnessing telemedicine and digital innovations to modernize its medical infrastructure and widen access to care —particularly in remote and underserved regions.

Guided by its ambitious Vision 2030 agenda and bolstered by rising investments in digital health, the Kingdom is accelerating the deployment of AI technologies, fundamentally reshaping how healthcare is delivered, managed, and experienced.

Vikas Kharbanda, partner and healthcare sector lead at Arthur D. Little Middle East, told Arab News that AI-driven telemedicine is allowing providers to move from reactive care to proactive health management, which is particularly important in remote areas where “physical infrastructure is difficult and costly to develop and operate.”

Historically, access to healthcare across the Arab world has been uneven, with rural populations often lacking access to specialized services. In Saudi Arabia, however, AI-enabled platforms are helping bridge these gaps by facilitating remote consultations, optimizing clinical workflows, and supporting early detection of disease.

One of the Kingdom’s flagship initiatives is the Seha Virtual Hospital, a fully digital facility that leverages AI for diagnostics and links medical specialists across various locations for real-time consultations. Kharbanda described Seha Virtual Hospital as “a starting point of showcasing the full spectrum capabilities of what is possible with the convergence of digital capabilities into the healthcare environment.”

“With rapidly emerging capabilities for virtual consultations, e-ICU, digital prescriptions and dispensing workflows, AI-enabled diagnoses augmentation the program is starting to demonstrate the potential of what a virtual care delivery model can potentially achieve and the value it can create for a health system,” he said.

Kharbanda added that the hospital “has created a platform from which individual capabilities can be picked and diffused in the whole health system — commercializing the infrastructure capabilities from the public sector into the private sector could help diffuse these capabilities very rapidly into the whole system.”

Another initiative is Nala, a digital platform that began using AI in 2022 to offer personalized care recommendations based on individual data. Nala integrates with wearables to monitor vital signs and flag potential health risks. In 2023, it was acquired by Integrative Health, a network of AI-led urgent care centers in the Kingdom.

Tech-enabled outreach

Telemedicine remains a cornerstone of Saudi Arabia’s digital health strategy. Virtual consultations are helping to ease the burden on hospitals and clinics by enabling patients to connect with healthcare professionals remotely—eliminating the need for travel and streamlining access to specialized care.

“Telemedicine could be a major enabler for access and AI capabilities, especially focused on health risk assessments, enabling remote diagnosis, triaging capabilities and potentially bringing together the financing and care delivery model in a more systematic fashion could fundamentally shift the way health and care is managed today in the market,” Kharbanda added. 

Telemedicine could be a major enabler for access and AI capabilities, especially focused on health risk assessments, enabling remote diagnosis, triaging capabilities and potentially bringing together the financing and care delivery model in a more systematic fashion.

Vikas Kharbanda, partner and healthcare sector lead at Arthur D. Little Middle East

High smartphone penetration and widespread internet access have supported the uptake of these tools. Babylon Health, in partnership with Saudi Telecom Co., offers an AI-based app for symptom checking and consultations, while local platform Cura provides similar services with remote diagnosis and digital prescriptions.

AI: the game changer 

Artificial intelligence is also being deployed to support clinical decision-making, personalize treatment plans, and deliver predictive insights that can improve patient care. Hospitals across Saudi Arabia are increasingly incorporating machine learning to optimize operations and enhance health outcomes.

According to a report by GlobalData, AI-powered monitoring systems are now in use in many healthcare facilities across the Kingdom. These systems utilize real-time analytics and sensor technologies to boost patient safety and alleviate staffing pressures—offering a glimpse into how smart technology is reshaping the day-to-day realities of clinical care.

“Most responsible AI-powered telemedicine solutions are developed as clinically assistive tools,” said Hannah Gibson, director of UK and global partners at Visiba. “Triage in-person consultations may not always be necessary and if they are, should be more efficient.”

Still, the development of benchmarking tools to evaluate AI systems remains limited. “It takes a significant amount of time and resources for companies to create reliable benchmarking tests for research and development purposes,” said James Tapscott, senior manager of innovation and legal technology at Addleshaw Goddard.

He referenced findings from a report by Addleshaw Goddard, which showed that specific AI-powered retrieval techniques boosted the accuracy of commercial contract reviews from 74 percent to an average of 95 percent. Highlighting broader applications of artificial intelligence, he noted that in certain scenarios, AI models can deliver more concise responses than human counterparts—without compromising on accuracy.

“When it comes to telemedicine, it may be that a more concise, easily understandable answer is preferred … it may be surprising to your readers to see how well these models perform compared to humans,” Tapscott added. Kellie Blyth, partner in commercial at Addleshaw Goddard, said image analysis is one of the most common applications. “The most prevalent use of AI we are seeing in the market is to analyze medical images such as X-rays, MRIs, and CT scans. Many of these solutions can detect anomalies and diseases with an extraordinarily high degree of accuracy, often at earlier stages than previously thought possible.”

Kharbanda said AI could help improve efficiency in outpatient consultations by at least 20 percent, while also easing bottlenecks in emergency and surgical departments.

Investment trends

Saudi Arabia’s digital health sector is experiencing rapid expansion, driven by both public and private investments. A study by BlueWeave Consulting estimated the country’s digital health market size at $3.2 billion in 2024, with projections indicating a compound annual growth rate of 21.3 percent through 2031, reaching $13.3 billion.

Kharbanda said there is a shift in investment focus toward “AI-driven diagnostics, augmented care delivery, and supporting the provider-payer system in understanding health risks and funding structures to optimize health outcomes.” 

The most prevalent use of AI we are seeing in the market is to analyze medical images such as X-rays, MRIs, and CT scans. Many of these solutions can detect anomalies and diseases with an extraordinarily high degree of accuracy, often at earlier stages than previously thought possible.

Kellie Blyth, partner in commercial at Addleshaw Goddard, said image analysis is one of the most common applications

Tapscott noted that semi-autonomous AI, also known as agentic AI, could become more common in lower-risk areas such as elder care, offering adaptive solutions that help reduce costs and increase efficiency.

Blyth pointed to the need for regulatory clarity, particularly around ethical use. She said frameworks should address “algorithm vigilance,” which involves regular monitoring to minimize bias and ensure safe use in clinical settings.

Looking ahead

Saudi Arabia’s digital health strategy continues to evolve, with future developments likely to include greater use of wearables, predictive modeling, and AI-assisted diagnostics.

Blyth said a major step forward will be the national biobank overseen by the King Abdullah International Medical Research Center. “The real advances in telemedicine will come at the state level with the establishment of the national biobank,” she said, which will serve as a valuable resource of clinical data from the Saudi population.

This will be further supported by computing infrastructure investments made through the Saudi Company for AI.

Gibson said triage systems powered by AI could soon become a regular feature across healthcare facilities, helping to direct patients to the appropriate level of care from the beginning.

As adoption grows, Saudi Arabia is developing a healthcare model that blends digital access with AI-backed insights, aimed at improving outcomes and supporting a more resilient health system.