Qatar Banking Sector: PESTEL Analysis and Business Opportunities

This report provides an analysis of the macro business environment of the Qatar banking sector. It begins with a summary of the competitive context, noting the dominance of Qatar National Bank and the high level of competition. A PESTEL analysis is then conducted, examining political stability, environmental initiatives, social factors like education and Islamic culture, technological advancements in data management and digital banking, economic factors such as natural gas and oil revenues, and legal factors ensuring safety and security. The report identifies business opportunities arising from technological advancements and industrial growth, supported by stable policies and regulations. The analysis is supplemented by an appendix providing a detailed PESTEL framework, assessing various factors and their implications for the Qatar banking industry. Desklib is a platform where you can find similar solved assignments and past papers for students.

Running head: ACCOUNTS
Qatar Banking Sector
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1QATAR BANKING SECTOR
Table of Contents
Summary..........................................................................................................................................2
PESTEL Analysis............................................................................................................................2
Business Opportunities....................................................................................................................5
Reference.........................................................................................................................................6
Appendix..........................................................................................................................................7

2QATAR BANKING SECTOR
Summary
The performance of the commercial banks is influenced by the market structure in which
the operations of the company is based. The Qatar Banking Industry currently has 14 commercial
banks, 7 foreign banks and 7 national banks. The Qatar National Bank is the leading bank in the
Qatar Banking industry holding about 50% of the market share, which is held by the government
(Bizri & El Bizri, 2017). The other banks operating in the Qatar banking sector holds the rest of
the market share, which is held by the Qatari Public. The level of competition has though been
high in the Qatar amongst the Qatar National Banking Company and other private companies
operating in the industry (Mirzaei & Moore, 2016).
PESTEL Analysis
The rising population and the growth and development of the company in terms of the
infrastructure and overall development was the key reason for the growth of the company in
terms of double-digit growth. The external macro business environment was analysed for the
economy with the help of PESTEL Analysis for the Qatar Banking Industry (Abdul-Wahab &
Haron, 2017).
Political Factors: The political factors for the Qatar has been stable as the frequency of elections
is not there, as Qatar does not have a democratic environment. The stability of the government in
the Qatar Economy is the key reason for absence of any kind of political turmoil in the economy.
The country has tried to maintain good relation with other neighbouring countries so that the
operations of the country can be carried on smoothly. The government policy regarding the
banking industry has been stable thereby providing various opportunities for the growth and
sustainable development of the companies operating in the industry.

3QATAR BANKING SECTOR
Environmental Factors: There are various efforts and initiatives taken by the government for
reducing the adverse impact on the environment. The Minister of Environment has taken several
efforts and has policies, which would reduce the adverse impact that can be caused to the
environment with the help of the operations of the companies in the Qatar economy. The
economy has strong assessment of the various business environment under which the operations
of the company is based (Kumaraswamy, Aktan & Al Halwachi, 2019).

4QATAR BANKING SECTOR
Social Factors: The economy has given special attention for the improvement of technical
knowhow and concern about raising the level of education through many programmes and policy
launched by the government. The awareness of market and financial institutions will make the
investors and customers get informed knowledge about the various products and services
provided by these institutes. Special attention is given to the religion and Islamic culture.
Technological Factors: The development of new technology and better data management has
helped the Qatar Banking sector grow at a double-digit revenue growth. The introduction of
various applications and software’s has helped the country grow at a rapid stage (Shandas,
Makido & Ferwati, 2017). Data management and providing advanced digital banking system has
enabled the customer get more accurate and faster customer support and various services faster.
Application of online payment, digital transfer of payments, various international banking
transactions and various other banking needs can be solved via the online support, which is
provided by the banks.
Economic Factors: The political and social factors helps the companies in the Qatar economy
grow well. The economy of the country is rich with natural gas and oil giving an opportunities
for many foreign and domestic companies to increase the operations of the company on a global
basis. The banking industry of the economy on the other hand is financially and operationally
stable for supporting and meeting the various support that would be required by these companies
for increasing their business operations. The enhancement of the hydrocarbon revenue has been
the key reason for the revenue growth of the economy giving a boost to the economy.
Legal Factors: The laws implemented by the government of Qatar has helped the country
legally stable. The individuals and organisations operating in the economy abides by the rules
and regulations of the economy, which help them, maintain a strong judicial system. The safety

5QATAR BANKING SECTOR
and security of the people is well maintained in the Qatar with the implementation and rules and
regulations followed by all. The above legal factors help the operations of the banking industry
and various other companies in the economies helping them carry on their daily work activities
with ease and care.
Business Opportunities
The two-business opportunity that are present in the macro business environment are:
 The growth and advancement of the various technology software’s and application will
help various companies in the Qatar Banking Industry and companies provide better
customer services and provide various kinds of banking related services.
 The industrial growth of the Qatar economy has been the best where the contribution
given by the Industrial sector has been highest. The stability of various political events in
the form of policies and regulations makes the operations and a day-to-day working of
the company smooth (Fernandez & Joseph, 2016).

6QATAR BANKING SECTOR
Reference
Basic Laws and Regulations in Qatar. (2019). Retrieved from
https://www.onlineqatar.com/living/laws-regulations.aspx
2019 Banking Industry Outlook | Deloitte. (2018). Retrieved from
https://www2.deloitte.com/qa/en/pages/financial-services/articles/gx-banking-industry-
outlook.html
Qatar’s banking sector sees 3.5% growth in credit in July. (2018). Retrieved from
https://www.gulf-times.com/story/605831/Qatar-s-banking-sector-sees-3-5-growth-in-
credit-i
Gulf Research Report. (2019). Retrieved from https://www.gulfbase.com/research-report-47676
Abdul-Wahab, A. H., & Haron, R. (2017). Efficiency of Qatari banking industry: an empirical
investigation. International Journal of Bank Marketing, 35(2), 298-318.
Bizri, R., & El Bizri, I. (2017, October). Challenges facing the Islamic banking industry in the
MENA region: A comparative study. In INTERNATIONAL CONGRESS OF ISLAMIC
ECONOMY.
Fernandez, M., & Joseph, R. (2016). Qatar Emerging as the Most Attractive FDI Destination in
the GCC. International Journal of Economics and Finance, 8(11), 175-192.
Kumaraswamy, S., Aktan, B., & Al Halwachi, Z. H. (2019). WHY DO FINANCIAL
SERVICES COMPANIES PAY DIVIDEND? EVIDENCE FROM QATAR STOCK
EXCHANGE.

7QATAR BANKING SECTOR
Mirzaei, A., & Moore, T. (2016). Banking performance and industry growth in an oil-rich
economy: Evidence from Qatar. The Quarterly Review of Economics and Finance, 60,
58-69.
Shandas, V., Makido, Y., & Ferwati, S. (2017). Rapid urban growth and land use patterns in
Doha, Qatar: opportunities for sustainability. European Journal of Sustainable
Development Research.

8QATAR BANKING SECTOR
Appendix
Issues/
Factors
Source Implication
O=opportunit
y
T= Threat
Impact
High
Mediu
m
Low
Timefram
e
Political
P1 Stable
Government
Policy and
Banking
Policies
www.economist.co
m
O Mediu
m
3-5 years
P2 Absence of
Democratic
Government
Economic
Ec1 Rising
GDP Growth
Rate
www.mof.qa.com O High 1-2 Years

9QATAR BANKING SECTOR
Ec2
Opportunities
for Industrial
and Demand
for Banking
Services
(2019 Banking
Industry Outlook |
Deloitte, 2018).
O Mediu
m
1-2 Years
Ec3 Business
and economy
concentration
in natural gas
and mining
industry.
T Mediu
m
1-2 Years
Sociological
S1 Rise in
Education
Program and
Initiatives
(Gulf Research
Report, 2019).
O High 1-2 Years
S2 Strong
unity and
family
institution
O Low 0-6
Months
Technological
T1 Fast (Qatar’s banking

10QATAR BANKING SECTOR
adopting
technology
sector sees 3.5%
growth in credit in
July, 2018).
T2 Better and
Efficient
Connectivity
and Data
Management
O High 0-1 Years
Environment
al
E1 Reducing
Adverse
Impact on
Environment
(2019 Banking
Industry Outlook |
Deloitte, 2018).
O Mediu
m
0-6
Months
E2
Environmental
Sustainability
Policies and
Programs for
reducing
carbon
emissions
(2019 Banking
Industry Outlook |
Deloitte, 2018).
O Mediu
m
0-1 Years
Legal

11QATAR BANKING SECTOR
L1 Increasing
binding of
international
legislations
(Basic Laws and
Regulations in
Qatar, 2019).
O Mediu
m
1-2 Years
L2
Implementatio
n and abiding
by the
Banking
Industry
Guidelines
and Policies
(Basic Laws and
Regulations in
Qatar, 2019).
O Mediu
m
0-1 Years