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Middle East And Africa Challenger Banks Market Size (2024 - 2029)

The market size of challenger banks in the Middle East and Africa is experiencing significant growth, driven by the increasing digital adoption among traditional banking players and the gradual decrease in unbanked population levels. The COVID-19 pandemic has accelerated the shift towards digital banking, although challenges such as onboarding and customer experience remain. Despite the obstacles posed by established traditional banks, the expansion of challenger banks and neobanks from other regions presents new opportunities, particularly for local entrepreneurs.

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Market Size of Middle East And Africa Challenger Banks Industry

Middle East And Africa Challenger Banks Market Summary
Study Period 2020-2029
Base Year For Estimation 2023
Market Size (2024) USD 74.03 Billion
Market Size (2029) USD 121.96 Billion
CAGR (2024 - 2029) 10.50 %
Market Concentration Low

Major Players

Middle East And Africa Challenger Banks Market Major Players

*Disclaimer: Major Players sorted in no particular order

Challenger Banks in Middle East & Africa Market Analysis

The Middle East And Africa Challenger Banks Market size is estimated at USD 74.03 billion in 2024, and is expected to reach USD 121.96 billion by 2029, growing at a CAGR of 10.5% during the forecast period (2024-2029).

There is increasing incorporation of digital means by the traditional players in the region and with a sigma to opt for bank credit in this region, unbanked population levels are always recorded high. There has been a decreasing trend in the unbanked population levels in the region. And the present pandemic conditions increased the importance of digital adoption. The main challenge today remains onboarding and customer experience, both of which still need to be more manual and efficient. Digital banks could also open up opportunities for local entrepreneurs. However, barriers to entry and the sheer scale of traditional banks make it difficult to imagine a digital-only challenger bank starting from scratch in the Middle East. Challenger banks and neobanks from the Indian sub-continent, Britain, and the US are expanding into the region. The COVID-19 pandemic slammed shut a decade-long window of opportunity for banks. Banks in the Middle East and Africa faced steep falls but reasonably steady recoveries.

Challenger Banks in Middle East & Africa Industry Segmentation

Challenger banks are digital banks that harness the power of modern technology to provide customers with the financial services they need anywhere, anytime. They are considered challenger banks depending on where one lives because they tend to compete with or challenge big banks using modern financial practices. An understanding of the challenger banks in the Middle East and Africa, the regulatory environment, challenger banks, and their business models, along with detailed market segmentation, product offerings such as deposits and loans to define their financial performance indicators, current market trends, changes in market dynamics, and growth opportunities. In-depth analysis of the market size and forecast for the various segments. The challenger banking market in the Middle East and Africa is segmented by service type (payments, savings products, current accounts, consumer credit, loans, and other service types) and by end-user type (business segment and personal segment).

The report offers market sizes and forecasts in value (USD) for all the above segments.

By Service Type
Payments
Savings Products
Current Accounts
Consumer Credit
Loans
Other Service Types
By End-User Type
Business Segment
Personal Segment
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Middle East And Africa Challenger Banks Market Size Summary

The Middle East and Africa challenger banks market is experiencing significant growth, driven by the increasing adoption of digital banking solutions and a supportive regulatory environment. Traditional banks in the region are incorporating digital means to enhance their services, addressing the historically high levels of unbanked populations. The COVID-19 pandemic has further accelerated the importance of digital adoption, although challenges remain in onboarding and customer experience. Despite these challenges, digital banks present opportunities for local entrepreneurs, although the dominance and scale of traditional banks pose barriers to entry for new digital-only players. The market is witnessing the expansion of challenger banks and neobanks from regions such as the Indian sub-continent, Britain, and the US, contributing to the competitive landscape.

The regulatory framework in the Middle East is favorable for the development of digital financial services, with governments and regulatory bodies actively supporting and advocating for digital banking initiatives. This has led to a reduction in the unbanked population over the years. Initiatives like the Saudi Central Bank's open banking policy exemplify efforts to accelerate the implementation of digital banking solutions. The market is fragmented, with several key players such as Bank ABC, Meem Digital Bank, Hala, CBD Now Bank, and Liv Bank. Recent developments include the launch of Wio Bank in the UAE, the region's first platform bank, and Mashreq's introduction of a supply-chain finance platform, highlighting the dynamic nature of the market.

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Middle East And Africa Challenger Banks Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Market Overview

    2. 1.2 Market Drivers

      1. 1.2.1 Increasing Smartphone Penetration

    3. 1.3 Market Restraints

      1. 1.3.1 Competition from Traditional Banks is Restraining the Market

    4. 1.4 Market Opportunities

      1. 1.4.1 Increasing Adoption of Digital Banking

      2. 1.4.2 Challenger Banks have to tap into the Unbanked and Underbanked Population

    5. 1.5 Porter's Five Forces Analysis

      1. 1.5.1 Bargaining Power of Suppliers

      2. 1.5.2 Bargaining Power of Buyers/Consumers

      3. 1.5.3 Threat of New Entrants

      4. 1.5.4 Threat of Substitute Products

      5. 1.5.5 Intensity of Competitive Rivalry

    6. 1.6 Latest Technologies Deployed by Challengers in Banking System

    7. 1.7 Performance Indicators of Challenger Banks

    8. 1.8 Industry Policies And Government Regulations

    9. 1.9 Impact of COVID-19 on the Market

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Service Type

      1. 2.1.1 Payments

      2. 2.1.2 Savings Products

      3. 2.1.3 Current Accounts

      4. 2.1.4 Consumer Credit

      5. 2.1.5 Loans

      6. 2.1.6 Other Service Types

    2. 2.2 By End-User Type

      1. 2.2.1 Business Segment

      2. 2.2.2 Personal Segment

Middle East And Africa Challenger Banks Market Size FAQs

The Challenger Banks In Middle East And Africa Market size is expected to reach USD 74.03 billion in 2024 and grow at a CAGR of 10.5% to reach USD 121.96 billion by 2029.

In 2024, the Challenger Banks In Middle East And Africa Market size is expected to reach USD 74.03 billion.

Challenger Banks in Middle East & Africa Market Report Snapshots

Challenger Banks in Middle East & Africa Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)