50% increase in car sales in Saudi Arabia seen
Financing for women buying cars ready, says Saudi bankers group official
Car sales are expected to increase by up to 50 per cent in Saudi Arabia following a royal decree allowing women to drive, local media said.
The Jeddah-based English daily Arab News reported on Friday that local banks expect a huge spike in car finance, and expect up 50 per cent increase in car sales following a landmark decision.
Talat Hafiz, secretary-general of the media and banking awareness committee of a Saudi bankers group, told the paper that they are ready to give car finance directly to qualified female applicants.
“Car sales in the Kingdom reach 600,000 annually," Hafiz told the paper. "However, this number will increase by 50 percent in the coming period, which will have many positive impacts on the country’s economy, including the GDP.”
GDP (gross domestic product) is the total value of products and services produced within a country, including personal consumption, investments and government spending — minus imports.
On September 26, Saudi state media announced that King Salman Bin Abdul Aziz ordered a landmark reform in a royal decree, allowing Saudi women to drive.
As for car loan approvals, Hafiz said banks make no distinction between women and men, whether it is a consumer, mortgage or investment loan.
Payments for vehicle mortgage will be made through car dealerships, Hafiz explained. The banker said the decision will have a positive knock-on effect on the economy, as it would facilitate the work of women and expandind their economic roles.
However, the move may reduce demand for existing taxi services in Saudi Arabia.
“One of the main problems impeding women’s work is transportation," the banking official was quoted as saying. "The money women spend on taxis is considered a big waste. Therefore, families will be able to save a lot now.”
Saudi ambassador to the United States, speaking to reporters on Tuesday after the kingdom announced it would permit women to drive, said all women holding licences from GCC nations would be allowed to drive in Saudi Arabia.
