In 2023, funding for SMEs in Saudi Arabia totaled approximately $3.2 billion.
In 2023, funding for SMEs in Saudi Arabia totaled approximately $3.2 billion.
RIYADH: As of December 2023, SR12.1 billion ($3.22 billion) had been allotted to 5,476 initiatives by Saudi Arabia's Kafalah program, which supports small and medium-sized businesses.
Over SR15.6 billion in finance was given to SMEs through the initiative, which also guaranteed 7,178 loan requests in 2023. According to the Saudi Press Agency, the effort gave priority to providing support to businesses located in different parts of the Kingdom.
A number of localities, like Asir (66%) and Al-Jouf (45%) and Tabuk (42) have demonstrated significant increases in guarantee values for potential regions.
According to SPA, cooperation with numerous government agencies was essential to SMEs' support in 2023.
With the help of the Kafalah program, SMEs can obtain the necessary funding for growth, drawing in new owners who are not accustomed to working with financial institutions.
In addition to promoting and assisting qualified businesswomen through preferential privileges and specialized training programs, the program demonstrated its dedication to supporting female entrepreneurs by highlighting their leading roles in the labor force and the national economy.
With guarantees totaling more than SR1.7 billion, the initiative assisted 1,076 businesswomen in 2023.
After obtaining secured financing, the number of employees and businesses expanded by 20 percent in just six months, demonstrating the program's efficacy.
After receiving Kafalah guarantees, employment of Saudi men increased by 7% and that of Saudi women by 9% in the first year, respectively, contributing to this rise, which peaked at 17% after two years.
Data from the Saudi Central Bank shows that at the end of the third quarter of 2023, the Kafalah finance guarantee program had boosted its share of financing for SMEs from 4.9 percent in the second quarter of 2018 to 12.2 percent, or SR32.6 billion.
The initiative was recognized with multiple honors, including the Best Program for Supporting and Empowering Businesswomen and the Best Guaranteed Financing Program for Small and Medium Enterprises in the Middle East.
In order to give microenterprises more support and improve their creditworthiness, SAMA and Kafalah launched the Guaranteed Financing Program in 2020. This program guarantees 95% of the value of financing awarded by banks and businesses based on the approved mechanisms within it.
Source arabnews.com
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