Program Launching and Objectives
The Small and Medium Enterprises Loan Guarantee Program “Kafalah" was founded under His Excellency the Minister of Finance's decision no. (1166) dated 04/05/1425 AH, with a view to overcome any obstacle in financing SMEs that are economically viable but that do not have the ability to provide the required guarantees to the financiers.
Kafalah aims at helping SMEs in obtaining the necessary financing to develop and expand their activities, and at encouraging the financial institutions to deal with the SMEs sector, in addition to attracting a new group of SME owner that have not previously dealt with financiers, with a view to developing the SMEs sector to realize its important role in the national economy through its contribution to providing new job opportunities, developing provinces that are least active economically.
Our Vision
"Effective guarantees to stimulate the financing and support of SMEs that contribute to strengthening the national economy"
Our Mission
"Providing financial guarantees to enhance access by SMEs to necessary financing through strategic partnerships, national cadres and innovative technological tools supported by our knowledge bases"
Pursuant to the Royal Order No. 7/B/510 dated 23/01/1422 AH approving the proposal for establishing an integrated government program for activating the role of SMEs, a sector known for its undeniable positive socio-economic contribution, H.E. the Minister of Finance issued his decision No. (1166) dated 04/05/1425 AH to approve the Regulatory Rules of the Small and Medium Enterprises Financing Guarantee Program. The Management of the Program was assigned to the Saudi Industrial Development Fund, as a joint development initiative between the Ministry of Finance and commercial banks cooperating with the Program.
The Program aims to overcome the obstacles to the financing of SMEs. As known, SMEs are economically viable; however, they are unable to provide the required guarantees to obtain financing by covering a percentage of the financier's risk in the event guaranteed activity fails to repay the financing or part thereof. The Program also aims to encourage banks to finance this type of enterprises.