Surging industrial projects, rising initial costing for new industries and easy availability of leasing providers are propelling the growth of Saudi Arabia leasing market. According to TechSci Research report, “Saudi Arabia Leasing Market – Industry Size, Share, Trends, Competition, Opportunities and Forecast, 2018-2028F” The Saudi Arabia Leasing market is expected to grow during the forecast period, owing to the factors such as growing convenience of online leasing platforms, rising investment within the country and attractive offers by the lending firms to the beneficiary.
The Important Elements of the Saudi Arabia Leasing Market
To generate income, Saudi Arabia is heavily dependent on the oil and gas sector. The government has introduced massive budget plans like the Saudi Vision 2030 National Transformation Program, in an effort to lessen its reliance on the oil and gas sector and diversify its revenue sources.
The government is encouraging the development of the nation’s infrastructure in order to meet the goals established by the ministry level. The Red Sea Tourism Project, Qiddiya Entertainment City, and Riyadh Metro are among the few government-backed initiatives that are anticipated to increase the demand for construction equipment rental services over the forecast period.
The National Infrastructure Fund (NIF) will support the ongoing infrastructure development initiatives in 2021, with the goal of luring foreign investment and partnerships to the nation. Therefore, the introduction of numerous stringent measures by the government authorities in these developed economies, coupled with various awareness programs promoting the need for Leasing, is further fueling the market growth.
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Saudi Arabia leasing market is segmented into lease type, provider type, tenure period, end user, regional distribution, and competitive landscape. Based on lease type, the market is divided into commercial vehicle lease, heavy equipment lease, plant and machinery lease, and real estate lease. Commercial vehicle leases dominated the Saudi Arabia Leasing market with a significant share. This is mainly because instead of spending money on truck purchases, businesses prefer to rent or lease trucks for their transportation needs. Truck leasing and rental services provide modern truck models at a reasonable price while also eliminating organizations’ maintenance and repair costs.
Based on provider type, the market is categorized into financial companies vs non-financial companies. Financial companies are expected to share the largest market in the forecast period, 2024-2028. many Financial institutions that are backed by government-banks have the propensity to lend to large or big businesses that have established balance sheets and a profitable track record. Additionally, because access to both medium- and long-term loans by businesses has become so scarce, many new businesses that require extensive capital resources and long-term funding are unable to develop or even get off the ground. As a result, some non-bank financial institutions exist that are still in the early stages of development and can meet the lending needs of these small and medium-sized businesses. However, limitations in the number of non-financial companies within the country, with stringent government laws for licensing, are responsible for the growth of financial companies in terms of providers, within this leasing market.
Leading market players operating in the Saudi Arabia Leasing market are:
- Yanal Finance Company
- Gulf Lifting Financial Leasing Company
- AJIL Financial Services Company
- Al Yusr Leasing & Financing Co
- Gulf Finance Company
- GuidanceATEL Equipment Support Company Limited
- United International Transportation Co. (Budget Saudi)
- Al Arabi Heavy Equipment Lease Company
- Kirnaf Co.
- Saudi Fransi Lease Finance Company
To cater to the demand from small & medium enterprises for leasing, various companies came up with the idea of online portals to fulfill the requirement of Saudi Arabian customers in an easy and convenient manner. For instance, The Small & Medium Enterprises General Authority (SMEA) and Al Yusr Leasing & Financing Co. have decided to join the E-Finance Portal, which Monshaat (SMEA) launched to make it simple for business owners and entrepreneurs to find the best financing options through a single portal that gathers investors and organizations that support finance electronically.
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“Government investment in construction activities, the growing presence of international companies in the country, and the benefits of tax deduction are among the influential factors for the growth of the leasing market in Saudi Arabia. Moreover, the existence of online platforms is also anticipated to aid in the market’s expansion, given that 95.7% of the population of the Kingdom has access to the internet.” said Mr. Karan Chechi, Research Director with TechSci Research, a research-based global management consulting firm”.
“Saudi Arabia Leasing Market by Lease Type (Commercial Vehicle Lease, Heavy Equipment Lease, Plant, and Machinery Lease, Real Estate Lease), By Provider Type (Financial Companies vs Non-Financial Companies), By Tenure Period (Less than 2 years, 2- 5 Years, More than 5 Years) By End User (Logistics/Transport, FMCG, Ecommerce, Retail, Industries, Construction, Government Sector, Others), By Region, Competition Forecast & Opportunities, 2028F has analyzed the future growth potential of Saudi Arabia leasing market and provides statistics & information on market size, structure, and future market growth. The report intends to provide cutting-edge market intelligence and assist decision makers to take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with significant drivers, challenges, and opportunities in Saudi Arabia Leasing Market.
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