RIYADH: Saudi Arabia’s Small and Medium Enterprises Bank will allocate SR10.5 billion ($2.79 billion) to finance various programs for the SME sector in the next three years.
The outlay will be spent on several products, as well as existing and new programs, such as the direct and indirect lending programs, the financing guarantee programs, and other investment programs, Saudi Press Agency reported.
This comes in line with the financial institution’s continuous efforts to support the SME sector to achieve the goals of the Kingdom's Vision 2030. The bank aims to facilitate raising the contribution of the SME sector to the country’s gross domestic product to 35 percent.
The SME Bank is also seeking to further boost and propel financing provided to SMEs and enhance the contribution of financial institutions in providing innovative financing solutions to the sector.
In return, this is expected to contribute to the growth and prosperity of this crucial sector, according to the acting CEO of the SME Bank Abdul Rahman bin Mansour.
The bank recently started with six main financing products that were developed based on the needs of SMEs.
SMEs can apply for financing through the bank’s website which provides access to more than 48 financing agencies in the Kingdom.
The announcement coincides with the joining of the Venture Investment Co. for which SR3.2 billion is allotted to support the strategic growth of the company in developing investment products.
These investment products are projected to enhance the firm’s role in stimulating and further sustaining financing startups from the pre-establishment stage to the pre-initial public offering stage by investing in funds as well as investing in startups.
The bank also announced that the financing guarantee program for SMEs, also known as Kafalah, would join the SME Bank amid efforts to back its programs and expand its business with the allocation of SR1 billion.
SMEs are set to play a significant role in achieving Saudi Arabia’s objectives of lowering the unemployment rate from 11.6 percent to 7 percent and increasing women’s participation in the workforce from 22 percent to 30 percent.
The SME Bank’s vision is to become a key enabler in providing funding solutions and strengthening the role of SMEs in the Kingdom's economy.