The "Middle East Buy Now Pay Later Business and Investment Opportunities Databook - 90+ KPIs on BNPL Market Size, End-Use Sectors, Market Share, Product Analysis, Business Model, Demographics - Q1 2026 Update" report has been added to ResearchAndMarkets.com's offering.

The BNPL payment market in Middle East is expected to grow by 25.2% on annual basis to reach US$3.3 billion in 2026.

The buy now pay later market in the country has experienced robust growth during 2022-2025, achieving a CAGR of 28.8%. This upward trajectory is expected to continue, with the market forecast to grow at a CAGR of 21.3% from 2026-2031. By the end of 2031, the BNPL sector is projected to expand from its 2025 value of USD 2.7 billion to approximately USD 8.8 billion.

Over the next 2-4 years, BNPL competition will consolidate around a few licensed, multi-product players. PSP and bank partnerships will determine distribution strength, while regulatory oversight will constrain aggressive growth strategies. Cross-border expansion within the GCC and into North Africa will intensify as leading players seek regional scale.

Current State of the Market

• BNPL in the Middle East operates within a concentrated environment dominated by regional fintechs, with Saudi Arabia and the UAE shaping competitive norms due to higher regulatory clarity and retail digitization. Tamara and Tabby hold significant positions across GCC markets, supported by strong funding, wide merchant integration, and early compliance with licensing frameworks such as SAMA's BNPL rules.
• In Egypt, valU anchors competition under the Financial Regulatory Authority's fintech licensing regime. Competitive intensity is rising as BNPL expands from ecommerce to in-store retail and services, underscoring the importance of partnerships with PSPs and payment gateways. Regulation in Saudi Arabia, the UAE and Egypt has simultaneously raised barriers to entry, concentrating scale among licensed providers.

Key Players and New Entrants

• Tabby operates across Saudi Arabia, the UAE and Kuwait, strengthened by its BNPL, Tabby Card and marketplace integrations. Tamara, now a licensed finance provider in Saudi Arabia, is expanding its product suite beyond short-term BNPL.
• valU continues to operate as a multi-sector instalment platform, recently listed on the Egyptian Exchange and expanding into Saudi Arabia and Jordan. New standalone entrants remain limited; most new activity comes from PSPs and orchestration platforms that embed BNPL rather than from new BNPL-only firms.

Key Trends and Drivers

Bring BNPL fully under formal consumer-finance regulation

• BNPL is being treated less as a "lightweight" checkout feature and more as regulated consumer credit in markets such as Saudi Arabia, the UAE, and Egypt. In Saudi Arabia, the central bank (SAMA) has issued dedicated rules to regulate BNPL Companies and linked BNPL to its broader finance company regime. In 2025, Tamara obtained a full consumer finance and BNPL license from SAMA, allowing higher ticket sizes and a broader product set. In Egypt, the Financial Regulatory Authority (FRA) supervises BNPL under its fintech framework and has both granted BNPL fintech licences (e.g., valU) and temporarily paused the issuance of new licences to manage overheating.
• The rapid growth of non-bank consumer finance and rising BNPL penetration have raised concerns about over-indebtedness and credit risk management, especially in inflation-affected markets like Egypt. Regulators in Saudi Arabia and the UAE are using BNPL rules and short-term lending frameworks to align with national financial-sector strategies and to ensure providers either obtain a license or partner with a licensed bank or finance company. Industry leaders themselves (Tabby, Tamara, valU) now publicly frame long-term BNPL growth as dependent on robust regulation and consumer protection, reinforcing the policy direction.

Scale BNPL through omnichannel retail and payment-stack partnerships

• BNPL is shifting from a mainly ecommerce add-on to a standard installment option across online and in-store channels, particularly in Saudi Arabia, the UAE, and Egypt. Recent analysis of MENA BNPL shows that in-store point-of-sale is the fastest-growing channel in the UAE and Saudi Arabia, reflecting mall-centric retail behaviour. In 2025, MoneyHash, a payment-orchestration platform, partnered with Tabby to give merchants across the UAE and Saudi Arabia access to Tabby's instalments via a single API, embedding BNPL directly into PSP and gateway stacks. In Egypt, valU's licensed digital onboarding on Noon allows shoppers to activate BNPL at checkout without prior registration, reflecting similar embedded-payments logic in local ecommerce.
• Large physical retail formats in Riyadh, Jeddah, Dubai and Abu Dhabi remain important, so providers like Tamara and Tabby are investing in in-store integrations and cards to follow the customer from app to mall POS. Merchants increasingly prefer orchestration platforms and PSPs to consolidate payment methods; plugging BNPL into these rails is more scalable than one-off integrations (as seen in MoneyHash-Tabby). For providers, omnichannel presence is a way to diversify volumes beyond pure ecommerce and reduce dependence on a narrow set of online verticals.

Extend BNPL beyond discretionary retail into services and essential spend

• BNPL usage is expanding beyond fashion and electronics into education, travel, insurance, healthcare and bills, with different patterns by country. A 2025 MENA trends review highlights BNPL adoption for school-fee instalments via edtech platforms such as Classera across GCC markets, and travel bookings via players like Cleartrip in the UAE. In insurance, providers such as GIG Gulf report strong growth in instalment plans for car and health coverage as customers spread rising premiums over time. In Egypt, valU's FRA-licensed BNPL is now embedded in multiple categories, retail, healthcare, education, and services and extended through partnerships with logistics and payment players such as ShipBlu and PayTabs Egypt.
• Cost-of-living and inflation pressures, particularly in Egypt and some Gulf markets, are pushing households to seek instalment plans for high-value or recurring expenses such as tuition, medical bills, and travel. Service providers (schools, hospitals, insurers, travel platforms) view BNPL as a way to sustain demand without heavy discounting, while managing their own receivables through BNPL partners. Regulators are willing to allow expansion into these sectors provided providers operate under a licensed, supervised regime (FRA licences in Egypt; SAMA licensing in Saudi Arabia).
• The mix of BNPL volumes is likely to tilt further toward services and essential spend, especially education and healthcare in Egypt and the Gulf. Product design will become more segment-specific: longer tenures and risk-based pricing for education and medical expenses; shorter, fee-light plans for discretionary retail. The shift into essential categories will keep regulatory scrutiny high, forcing providers to strengthen affordability checks and hardship policies and potentially slowing more speculative growth plays.

Evolve BNPL providers into multi-product financial platforms and cross-border players

• Leading BNPL firms are broadening into full-fledged financial services apps and expanding geographically, especially in the GCC and from Egypt into the Levant. In February 2025, Tabby raised $160 million in Series E funding at a $3.3 billion valuation, with over 15 million users and more than 40,000 merchants across Saudi Arabia, the UAE, and Kuwait. The company now offers BNPL, Tabby Card, longer-term plans, and services such as Tabby Shop and buyer protection, and has acquired the Saudi digital wallet Tweeq. Tamara's SAMA license allows it to move beyond small BNPL tickets into broader consumer finance, positioning it as a multi-product lender in Saudi Arabia and neighbouring GCC markets.
• The BNPL landscape in the Middle East is likely to be dominated by a small set of regional platforms (Tabby, Tamara, valU, and a few others) that combine BNPL with card and wallet features and consumer finance. Boundaries between BNPL, cards, digital wallets and consumer-finance firms will blur, intensifying competition with banks while also creating more partnership opportunities (co-branded cards, co-lending, white-label BNPL). This evolution could improve resilience through diversified income streams and better risk management tools, but may also increase systemic importance, making regulatory engagement a continuing strategic priority for these firms.

Companies Featured

• Splitit
• Jifiti
• ChargeAfter
• Sunbit Israel
• Tamara
• Tabby
• Spotii
• Cashew
• Postpay

For more information about this report visit https://www.researchandmarkets.com/r/r5ak1s

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