Last updated: 21 October 2026
Banking as a Service (BaaS) is a model in which a licensed bank or finance company makes its accounts, payments and lending available to other businesses through APIs, so they can offer financial products inside their own apps and journeys. In the GCC, three developments are pushing it forward: fast growth in digital payments, open banking and open finance rules, and a new generation of licensed digital banks. For the difference between BaaS and the experience a customer sees, read embedded finance vs Banking as a Service.
How big is the GCC digital banking market?
One estimate, from P&S Intelligence, puts the GCC digital banking market at $12.7 billion in 2025 and projects $47.6 billion by 2032, a compound annual growth rate of 20.8% (P&S Intelligence, GCC Digital Banking Market, October 2025). Estimates from different research firms vary, so treat the figure as a sign of direction rather than a precise forecast.
What is driving Banking as a Service in the GCC?
Digital payments are now the norm
In Saudi Arabia, electronic payments made up 79% of all retail payments in 2024, up from 70% in 2023, according to the Saudi Central Bank (SAMA, 15 April 2025). When customers expect to pay and borrow digitally, the businesses they deal with want to offer financial products in their own channels, and they need a licensed partner to supply them.
Open banking and open finance rules
Regulators across the region have set out how customer data and payment services can be shared with authorised third parties. In the UAE, the Central Bank’s Open Finance Regulation, Circular C 03/2025, is in force (CBUAE Rulebook). In Saudi Arabia, SAMA issued the second release of its Open Banking Framework, covering payment initiation, in September 2024 (SAMA), and in March 2026 began licensing fintech companies to provide open banking services (SAMA). Bahrain was early: the Central Bank of Bahrain issued open banking rules in December 2018 and launched the Bahrain Open Banking Framework in November 2020 (IBS Intelligence, 3 November 2020).
Open banking and BaaS are related but not the same. Open banking governs authorised access to data and payments; BaaS is a commercial arrangement in which a licensed institution supplies financial products to partners. The rules make partner models easier to build, but they do not authorise every BaaS structure on their own.
New digital banks
Saudi Arabia has licensed three local digital banks, the third being D360 Bank (SAMA). Qatar Central Bank issued a regulatory framework for digital banks in December 2024 (Qatar News Agency, 2 December 2024). Digital banks compete on speed and experience, which pushes incumbent banks to look at partner distribution as well.
Banking as a Service by country: the current picture
| Country | What is in place | What it means for BaaS |
|---|---|---|
| UAE | Open Finance Regulation (Circular C 03/2025) in force; BNPL and short-term credit regulated under the Finance Companies Regulation since December 2023 | A clear framework for data sharing and partner lending, with licensing for those who offer credit |
| Saudi Arabia | Open Banking Framework second release (September 2024); open banking licences for fintechs (March 2026); three licensed local digital banks; BNPL rules (December 2023) | A fast-moving market where licensed institutions and fintechs both look for partner models |
| Bahrain | Open banking rules (December 2018) and the Bahrain Open Banking Framework (November 2020) | The longest-running open banking regime in the region |
| Qatar | Digital banks regulatory framework (December 2024) | New digital bank entrants will need modern cores and partner capabilities |
| Kuwait and Oman | Check the current position with the Central Bank of Kuwait and the Central Bank of Oman | Plan BaaS programmes around each regulator’s current rules |
Rules change by circular. Check the regulator’s current version before you design a programme.
Why many legacy cores struggle with Banking as a Service
A bank can offer BaaS on almost any core in principle. In practice, older cores often make it slow and expensive, for four reasons:
- Products are coded, not configured. Each new partner programme needs its own products, pricing and limits. If every change is a vendor project, partners wait months.
- APIs are added on top. When only part of the core is exposed through APIs, partners hit gaps and integrations need custom work.
- Books are hard to separate. The bank needs separate reporting per partner, while keeping one view of each customer and a clear owner for reconciliation.
- Batch processing. Partners expect real-time decisions and balances inside their own apps.
Our guide to embedded finance and BaaS sets out what a bank needs before it offers BaaS, from customer-level records to controls the bank can apply on its own.
Where Banking as a Service is used in the GCC
- Instalments and buy now, pay later at checkout, under licensing regimes such as SAMA’s BNPL rules and the CBUAE’s short-term credit framework. See how BNPL works for lenders.
- Finance for small businesses inside accounting, invoicing or marketplace software, assessed on the data the platform already holds.
- Accounts, wallets and cards inside consumer apps, supplied by a licensed bank behind the brand.
- Sharia-compliant products offered through partners, where the core has to support Islamic structures natively.
How Fimple supports Banking as a Service
Fimple provides an API-first, composable technology platform for banks, finance companies and fintechs. A bank considering BaaS can use Fimple’s banking platform and APIs to support configurable financial products and integration with partner channels, or connect Fimple’s digital channels to the core it already runs. Conventional and Islamic products can run on one platform. See Banking as a Service with Fimple and the API-first approach behind it.
Fimple supplies the technology. Regulated activity, customer protection and regulatory accountability stay with the licensed institution under the applicable arrangements.
Frequently asked questions
What is Banking as a Service in banking?
It is a model in which a licensed bank or finance company supplies financial products, such as accounts, payments and lending, to other businesses through APIs, so those businesses can offer them in their own channels.
Is Banking as a Service regulated in the GCC?
BaaS itself is a business model, but the activities inside it are regulated: taking deposits, lending, payments and data sharing each fall under the rules of the relevant central bank. The licensed institution remains accountable for them.
Which GCC countries have open banking rules?
Bahrain issued open banking rules in 2018, Saudi Arabia has an Open Banking Framework and began licensing open banking providers in 2026, and the UAE has an Open Finance Regulation in force. Check each regulator for the current position in Qatar, Kuwait and Oman.
What is the difference between Banking as a Service and open banking?
Open banking is a regulatory framework for sharing customer data and initiating payments with the customer’s consent. Banking as a Service is a commercial model in which a licensed institution supplies financial products to partners. The two often work together but are not the same.
Planning a BaaS programme? Talk to Fimple about the platform behind it.
