Buy Now, Pay Later (BNPL) Solutions in MENA

Ever left a store with a bag full of goodies and realized you haven’t actually paid in full? That’s the magic of Buy Now, Pay Later (BNPL). Across the Middle East and North Africa (MENA), BNPL has exploded in popularity – and for good reason. Shoppers in Saudi Arabia, the UAE, and beyond are embracing the freedom to buy now and pay later in easy installments. Fintech startups are racing to offer BNPL at checkouts, and retailers are loving the boost in sales. This lively trend is transforming retail financing in MENA and reshaping how people shop and spend.

The Rise of BNPL in MENA

BNPL isn’t just a buzzword – it’s a full-blown movement in MENA’s fintech scene. In fact, the Middle East BNPL market is projected to reach about $5.8 billion in 2025, up 19.4% from the year before. The region’s young and tech-savvy population, coupled with an e-commerce boom, has fueled annual BNPL growth rates of nearly 29% in recent years. This surge is everywhere – from online stores to mall outlets – making installment payments a mainstream choice.

What’s driving this explosive growth? Several factors stand out:

• Youthful, digital-savvy demographics: Roughly half the region’s population is under 30. These digital natives are comfortable with mobile apps and online payments, making them natural BNPL adopters.
• E-commerce boom: Shopping online is second nature now. In Saudi Arabia and the UAE, about 70% of BNPL transactions happen in online stores. Big e-commerce players like Noon and Amazon offer BNPL at checkout, further normalizing it.
• Limited credit card penetration: Traditional credit cards aren’t as widespread in parts of MENA. BNPL steps in to fill that gap with quick, interest-free installment plans, bringing formal credit access to people who might not qualify for loans or cards.
• Fintech innovation and funding: Payment solutions – especially BNPL – have become the hottest space in MENA fintech. According to Forbes, BNPL and similar payment services dominated fintech investment, with the top 50 MENA fintech firms processing over $240 billion in transactions and raising $3.8B in funding. Investors see huge opportunity in BNPL platforms, and startups are sprinting to capture the market.

The result? BNPL usage has skyrocketed. In the Gulf region, BNPL payment volume jumped 200% in the summer of 2023 compared to a year earlier. Shoppers love the flexibility of splitting payments, and merchants enjoy seeing more items in customers’ carts. It’s a classic win-win that’s making waves across MENA.

BNPL in Saudi Arabia: A New Way to Pay

BNPL in Saudi Arabia is out in front. In malls and online checkouts, “split into 4” is everywhere. Nearly half of Saudi online shoppers used BNPL last year, roughly 42%. By 2022, BNPL even beat credit cards by about 10 percentage points, a clear shift toward installments over swipes.

Local champions power the boom. Tabby and Tamara are the go-to fintech BNPL platforms, partnering with thousands of merchants. Tabby, founded in the UAE and now headquartered in Saudi, serves 10+ million users across Saudi, the UAE, and Kuwait, hitting a $1.5B valuation in 2023 and about $3.3B by early 2025. Tamara is close behind at around $1B, expanding fast across the GCC – proof that buy now pay later in the UAE and Saudi adoption are rising together.

Why the love? Installment plans – often interest-free – fit local buying habits and Sharia-compliant preferences, while apps approve limits in minutes and speed up checkout. Merchants see bigger baskets, with Tabby reporting ~33% higher average order values. Regulators are engaged: SAMA set rules on capital and transparency to keep growth healthy and consumer-friendly, positioning Saudi’s BNPL market as a regional model.

Buy Now, Pay Later in the UAE: Spreading Fast

Buy now pay later is everywhere in the UAE – from Dubai boutiques to Abu Dhabi malls. Online adoption is high, with about 39% of UAE shoppers paying via BNPL recently. A tech-forward population and deep e-commerce habits make installments feel natural and fast.

Multiple fintech BNPL platforms compete at checkout. Tabby, Tamara, and home-grown players like Postpay and Cashew plug directly into popular sites, including Amazon.ae. Shoppers now expect a “Pay in 4 installments” button for both small treats and big-ticket buys.

Psychology seals the deal: splitting a purchase into monthly bites makes a laptop – or perfume – feel manageable. Usage jumped 200% year-on-year in summer 2023, and merchants have noticed bigger baskets. Regulation is evolving, banks are piloting POS installments, and local startups win on Arabic support and Sharia-aligned models. BNPL has moved from novelty to norm, with more flexible offers and loyalty perks on the way.

Fintech BNPL Platforms Driving Innovation

At the heart of MENA’s BNPL wave is a dynamic group of fintech BNPL platforms. These companies blend technology and finance to make instant installment loans possible at checkout. They partner with retailers, run sleek mobile apps, and use smart algorithms to approve customers in seconds. Here are a few of the leading BNPL platforms in MENA and what they offer:

Fintech BNPL platforms in MENA share a simple playbook: slick apps, instant approvals, and clear terms with no hidden fees when bills are paid on time. Each focuses on different categories or segments, and many now offer services beyond installments. Revenue comes mainly from merchant fees, plus late fees or interest on longer plans.

These providers bridge a real gap in credit access. With alternative scoring – think phone number, national ID, and basic payment signals – they can approve a young professional in Cairo or Jeddah in minutes. Fast, lightweight underwriting widens access for younger and underserved consumers across retail financing MENA.

Backed by global investors, the category is scaling fast and rolling out new features. Expect loyalty rewards, in-app marketplaces, “save now, pay later,” and card-linked options that blend old and new rails.

Transforming Retail Financing in MENA

The ripple effects of BNPL are being felt across retail financing in MENA. By retail financing, we mean all the ways consumers can finance their purchases – credit cards, personal loans, or payment plans. BNPL has effectively introduced a new form of instant retail financing that’s simpler than a loan and more accessible than a credit card. This is reshaping shopping behavior and retail strategies alike:

• Higher sales and bigger baskets: Retailers are noticing that when they offer BNPL, customers buy more. A shopper might upgrade to a pricier smartphone or add extra items when they know they can pay in chunks. For instance, merchants working with BNPL providers like Tabby have seen average order values jump ~33% on average. That’s a huge boost for retailers’ revenue.
• Better checkout conversion: Cart abandonment (when online shoppers quit at checkout) decreases when BNPL is available. Many hesitant buyers see a small installment and feel it’s doable, converting to a sale instead of abandoning their cart. This means e-commerce platforms in MENA love integrating BNPL – it directly lifts their conversion rates and profits.
• Serving the unbanked: In countries where many people don’t have bank loans or credit cards (which is a sizable portion of MENA’s population), BNPL is filling the credit gap. Someone with no credit history can still buy a fridge or pay for a dress over time with BNPL. This financial inclusion angle is significant, especially in emerging markets. By allowing “buy now, pay later” without traditional credit checks, BNPL brings new customers into the formal retail finance system.
• Omnichannel retail integration: BNPL started online, but it’s increasingly available in physical stores across MENA. Big retail chains are installing BNPL options at point-of-sale terminals or via QR codes. This omnichannel presence means whether you’re shopping on an app or in a mall, you can opt for installments. It blurs the line between online and offline retail financing, making installments a norm everywhere.

BNPL gives consumers breathing room. It’s a short-term, often zero-interest plan that smooths cash flow without a big upfront hit. Young professionals use it for lifestyle upgrades they’d otherwise delay. Families spread the cost of laptops, appliances, or furniture over a few paychecks and keep monthly budgets intact across retail financing MENA.

But the ease cuts both ways. Splitting payments can tempt overspending, and most BNPL providers don’t report to credit bureaus, so debts can stack up across multiple apps. Miss a due date and fees kick in. Many platforms now start users on low limits, raise them only after on-time payments, and add in-app reminders. As BNPL becomes standard, the priority is clear: grow access while protecting consumers.

Opportunities and Challenges Ahead

BNPL in MENA is not a passing fad – it’s a fundamental shift in how people finance purchases. The opportunities on the horizon are immense:

• Continued growth in new markets: Thus far, BNPL has thrived in the Gulf countries and in Egypt. But there’s untapped potential in other MENA countries – from Jordan to Morocco – where e-commerce is growing and consumers could benefit from installment options. We can expect BNPL providers to expand their footprint across the region, tailoring their offerings to local needs.
• Partnerships with banks and brands: Traditional banks, which once saw BNPL startups as competitors, are now looking to partner or launch their own BNPL-style services. For example, some banks are integrating fintech BNPL platforms via their mobile banking apps. Large retail brands are also exploring white-label BNPL solutions to keep customers in-house. These collaborations could further propel BNPL adoption, by combining the trust of banks with the tech of fintech.
• Product innovation: The basic “split into 4 payments” model might evolve. We’re already seeing variants like longer-term BNPL (12-month plans for bigger purchases), subscription BNPL (pay monthly for a service, but with the flexibility to cancel), and even BNPL for travel and education (splitting the cost of a vacation package or school tuition). MENA’s startups are likely to keep innovating, finding new niches where pay-later models can work.

At the same time, some challenges loom:

• Regulatory clarity: Not all MENA markets have BNPL-specific rules yet, creating confusion for providers and merchants. Governments are drafting frameworks—taking cues from SAMA – to set licensing, capital requirements, fee caps, and data-privacy standards. Clear, consistent rules will protect consumers and support fintech growth while curbing predatory practices – a balance regulators will keep refining.
• Competition and sustainability:BNPL is crowded in MENA and worldwide, and competition is fierce. Price cuts on merchant fees or looser consumer terms can crush margins, pushing smaller players toward consolidation or partnerships. The long-term winners will show clear value – lifting merchant sales while keeping risk tight – by focusing on sustainable growth and disciplined underwriting..
• Consumer debt risks: As mentioned, there is the risk of consumers overextending with BNPL. If the economy faces a downturn or inflation squeezes household incomes, there’s a chance of higher default rates on these pay-later plans. BNPL companies in MENA will need robust credit-check systems (potentially sharing data with credit bureaus in the future) and consumer education to ensure this convenient tool doesn’t become a debt trap for vulnerable users.

Conclusion

BNPL has moved from niche to mainstream across MENA. From Saudi Arabia’s malls to UAE e-commerce, installment checkout is now standard. It blends a familiar concept – installments – with a fast digital flow that shoppers trust.

Fintech BNPL platforms keep adding features, retailers report higher conversion and bigger baskets, and customers return for the flexibility. A $3.3B valuation for a Saudi player signals scale and staying power. BNPL now sits alongside cash, cards, and wallets as a core rail in retail financing MENA.

Thinking about BNPL Saudi Arabia or buy now pay later UAE for your brand? Let’s map the business case, compare partners, and plan an integration. Contact us to scope a fintech BNPL platform rollout – complete with risk controls, SAMA/UAE compliance, and an ROI model for your checkout.

By adminko