Opportunity Assessment for Islamic Banking in the MSME segment in Saudi Arabia
Background
An international financial institution engaged Aranca to conduct a market study and assess the potential opportunities in providing Islamic banking services to MSMEs in KSA
Aranca Solution
Assessment the structure and level of financial access of MSME sector in KSA; identifying challenges (to financial access) faced by MSMEs; and quantifying the market potential in terms of latent demand for Islamic banking in the kingdom
Results
Our analysis revealed the SME gap In Islamic financing and provided a strategic roadmap to tap the underlying potential
Ideate
Assess the Islamic banking needs of MSMEs in KSA; develop a benchmarking framework to determine key MSME requirements and capacities of banks to efficiently serve MSMEs in the Kingdom.
Desk Research
Economic landscape and MSME sector analysis, determining lending activity by banks in KSA (both overall and to the MSME sector), and studying the Islamic banking regulation in the kingdom
Expert Interviews
~100 interviews senior banking officials, chambers of commerce representatives, government officials, MSME support agencies, MSME sector experts and MSMEs
Analysis
Categorizing MSMEs based on level of financial access; estimating the Islamic lending and depository potential within the MSME sector ;developing a strategic roadmap for the banking system to build up capacity to bridge the gap in financing
