Middle East Alternative Lending Databook Report 2025: A $31.3 Billion Market by 2029 - Size & Forecast by Value and Volume Across 100+ KPIs 2020-2029 - ResearchAndMarkets.com

DUBLIN--(BUSINESS WIRE)--The "Middle East Alternative Lending Market Size & Forecast by Value and Volume Across 100+ KPIs by Type of Lending, End-User Segments, Loan Purpose, Finance Models, Distribution Channels, and Payment Instruments - Databook Q4 2025 Update" has been added to ResearchAndMarkets.com's offering.

The alternative lending market in the Middle East is anticipated to experience vigorous growth, projected to expand by 15.5% annually, reaching USD 18.9 billion by 2025. The robust increase observed from 2020 to 2024 with a CAGR of 15.3% is forecasted to persist, achieving a CAGR of 13.5% from 2025 to 2029. By the end of 2029, it's expected to grow from USD 16.3 billion in 2024 to approximately USD 31.3 billion.

Key Trends and Drivers

Alternative lending in the Middle East is significantly influenced by the surge in BNPL, increased capital infusion, embedded finance, and refined credit modeling. These factors are interlinked, moving credit origination from standalone applications to platform-based environments. Institutional capital supports this shift, alongside data-driven risk systems. Entities that balance growth with credit discipline, integrate credit into consumer ecosystems, and adapt to regulatory changes will perform well. Going forward, lending will prioritize intelligent, contextually aware, and sustainable credit solutions.

BNPL & Instalment Credit in Retail and E-Commerce

The BNPL market is expected to grow by around 19.4% year over year in 2025. Significant platforms such as Tabby, Tamara, and Postpay in Saudi Arabia, UAE, and the broader GCC region continue to integrate with e-commerce giants like Noon and Amazon MENA.

Key Growth Drivers and Ecosystem Enablers:

• E-commerce growth increases opportunities for embedded credit.
• Consumers often prefer instalment options due to credit card limitations.
• Maturing fintech infrastructure improves integration efforts.
• Regulatory clarity in some markets aids BNPL initiatives.

Both online and offline markets will see intensified BNPL and instalment credit usage. Growth pressures may lead to more stringent underwriting practices. Emerging regulations will necessitate enhanced risk controls and transparency.

Institutional Debt & Capital Infusion

More alternative lending firms in the Middle East are leveraging institutional capital and partnership funding to scale operations. In H1 2025, MENA startups raised USD 2.1 billion, with debt instruments contributing to nearly 44% of capital raised.

Key Growth Drivers and Ecosystem Enablers:

• Institutional support provides long-term viability and risk management.
• Investors seeking growth are channeling funds into fintech.
• Government support through funds and innovation hubs enhances development.
• Fintechs with robust risk frameworks attract more capital.

Over the forecast period, institutional capital will be crucial for alternative lending growth. Lenders will adopt hybrid models, partnering with banks or funds. However, macro volatility and regulatory scrutiny will affect capital strategy decisions.

Embedded Finance & Platform-Driven Credit Credit is increasingly integrated within digital platforms, super apps, and marketplaces in the Middle East.

Key Growth Drivers and Ecosystem Enablers:

• Platforms have the necessary customer data and distribution reach.
• Consumers expect seamless financial experiences within platforms.
• Strategic partnerships allow greater reach and reduced acquisition costs.
• Regulatory openness allows experimentation with finance models.

Embedded credit will emerge as a dominant lending approach in regions like the UAE and GCC. Standalone credit applications will need to evolve into infrastructure players or secure strong platform partnerships.

Use of Alternative Data & Machine Learning The use of alternative data sources and machine learning for credit decisioning is on the rise.

Key Growth Drivers and Ecosystem Enablers:

• Data from digital footprints is leveraged for more accurate credit assessments.
• AI and analytics tools improve risk prediction capabilities.
• Competitors must surpass traditional underwriting to scale successfully.

Lenders utilizing machine learning and alternative data will have a competitive edge as models become more precise. Regulators may demand transparency and fairness checks.

Competitive Landscape

The Middle East's alternative lending sector is seeing rapid growth, with firms like Beehive, Tabby, and Tamara reinforcing their market positions. Strategic collaborations are paving the way for ecosystem consolidation - long-term success hinges upon resilient credit models, efficient funding structures, and compliance with evolving regulations. The UAE leads the region with a hub of nearly 100 registered lending firms.

Key Players & New Entrants:

• Beehive is a prominent P2P marketplace in the GCC region.
• Tabby and Tamara are leading BNPL providers.
• CredibleX focuses on revenue-based financing.
• Raqamyah directly connects SMBs with investors.

Recent mergers and partnerships signal continued scaling, with new regulations shaping the industry's trajectory. The competitive landscape is ripe for innovation-driven differentiation through strategic alignment with fintech and payment infrastructures.

Key Attributes:

Report Attribute	Details
No. of Pages	1000
Forecast Period	2025 - 2029
Estimated Market Value (USD) in 2025	$18.9 Billion
Forecasted Market Value (USD) by 2029	$31.3 Billion
Compound Annual Growth Rate	13.5%
Regions Covered	Middle East

Key Topics Covered:

1. About this Report

2. Economic Indicators

3. Broader Market Enablers & Digital Infrastructure

4. Overall Lending Industry Attractiveness

5. Overall Lending Market Size and Forecast by Type of Lending

6. Overall Lending Market Size and Forecast by End-User

7. Retail Lending Market Size and Forecast by Loan Purpose / Use Case

8. SME/MSME Lending Market Size and Forecast by Loan Purpose / Use Case

9. Overall Lending Market Size and Forecast by Distribution Channel

10. Alternative Lending Industry Attractiveness

11. Alternative Lending Market Size and Forecast by End-User

12. Alternative Lending Market Size and Forecast by Finance Models

13. Alternative Lending Market Size and Forecast by Finance Models and End-User Segments

14. Alternative Lending Market Size and Forecast by Loan Purpose / Use Case - Retail (Consumer Lending)

15. Alternative Lending Market Size and Forecast by Loan Purpose / Use Case - SME/MSME (SME/MSME Lending)

16. Alternative Lending Market Size and Forecast by Payment Instrument

17. Alternative Lending by Finance Models across Payment Instruments

18. Alternative Lending Analysis by Consumer Demographics & Behavior

19. Further Reading

For more information about this report visit https://www.researchandmarkets.com/r/7gsald

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