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Segregated banking in Saudi
With Gulf women set to control $385 billion of assets by 2011, more and more single-sex lenders are opening their doors in KSA.
April 21, 2010 4:56 by Sarah Abdullah
Women’s banking in Saudi Arabia has been around for at least two decades, but really took off in 2005. The phenomenon has grown into a lucrative market that banks say can be further capitalized on through opening more branches and rolling out more financial products designed for women.
Why expand further? Because of the size of the market and the amount of wealth that not only Saudi but also Gulf women control.
Between 2007 and 2008 Saudi women strengthened their position as financial powerhouses by increasing their control of assets from $110 billion to $160 billion, a 68 per cent increase in just 12 months, according to economist Safa Al-Hasim. Saudi women own 40 per cent of family-run businesses, a third of brokerage accounts and control 20 per cent of Saudi mutual funds. Gulf women have increased their wealth as well, with the latest estimates showing their worth to be $346 billion in 2008 – projected to increase to $385 billion by 2011.
In November, Saudi Hollandi Bank inaugurated two new women’s branches, one in Riyadh and one in the Eastern Province city of Al-Khobar. The Al-Khobar branch is the third to open in 2009. The new bank branches are in line with plan to expand women’s branches Kingdom-wide. So far 11 have opened.
Faten Aba-Alkhail, head of women’s banking at Saudi Hollandi Bank, said the bank’s growth-oriented strategy reflected the rise in the use of banking services by women as more of them enter the workplace.