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Money is flowing into Saudi SMEs days after the Kingdom approved a new national SME strategy, which prioritizes access to finance in an effort to raise the sector’s economic contribution. Last week’s funding agreements show more capital being directed at that gap.
Monsha’at, STC Bank line up SAR 5 bn: The Small and Medium Enterprises General Authority (Monsha’at) signed a cooperation agreement with STC Bank to provide up to SAR 5 bn in shariah-compliant financing for SMEs across the Kingdom, state news agency SPA reports. And it wasn’t the only SME funding move to land this week.
What the Monsha’at program covers: The program will offer short-, medium-, and long-term financing of up to 10 years, covering working capital and operating needs, business assets, equipment, receivables, contracts, and e-commerce activity. It will also include supply-chain and trade-finance services, including guarantees and letters of credit.
ALSO- Debt crowdfunding platform Lendo has signed three financing partnerships worth up to SAR 890 mn to expand funding for Saudi SMEs and smaller businesses. The largest is a program of up to SAR 750 mn with Vienna-based Quantic Financial Solutions for SME working capital financing. Lendo also signed a SAR 100 mn funding partnership with BSF Capital for SMEs and a SAR 40 mn co-financing agreement with the Social Development Bank targeting small and micro enterprises. The agreements were announced during Money 20/20 Middle East in Riyadh.
Financing alone won’t do it. “Without the right human capabilities in areas such as finance, marketing, data, technology, and innovation, it risks becoming temporary liquidity rather than a tool for expansion,” Human Capabilities and Talent Management Consultant Sahar Al Samdany told us. SME Development Consultant Ali Al Ghadeer pointed to three fixes needed alongside capital: financing matched to a business’s stage, market access to procurement and supply chains, and stronger financial management, talent, and digital systems to scale.
