Riyadh:
The "Kafalah" Program has been able to support 4,945 MSMEs through its multiple financing guarantee programs. During the Coronavirus pandemic, the number of financiers cooperating with the Program increased from 12 to 33 financiers authorized by the Saudi Central Bank "SAMA", while the value of issued guarantees increased by 156 percent as compared to the previous year, and the value of financing has reached SAR 15.2 billion within one year, marking a rise of +106% as compared to the previous year. The Program aims to motivate financiers to provide the financing necessary to protect enterprises against the repercussions of the economic crisis that has affected different countries of the world and in particular SMEs.
Under the generous approval of the Government of the Custodian of the Two Holy Mosques, King Salman bin Abdul Aziz, and HRH the Crown Prince, a package of initiatives has been launched to mitigate the effects facing these enterprises. Some of these important initiatives were manifested when Kafalah Program increased the maximum guarantee ratio for micro enterprises up to SAR 2.5 million, and SAR 5.0 million for small enterprises and SAR 15 million for medium-sized enterprises, along with provision of guarantees up to 95% of the value of the financing, deferral of installments for six months, exemption of enterprises from finance fees, as well as not requiring the enterprises to provide material guarantees.
For his part, the Program Director General, Mr. Homam Hashem has praised the successful cooperation with government sectors, most importantly the Small and Medium Enterprises General Authority "Monsha'at", the Saudi Central Bank "SAMA" and the National Development Fund that represent the strategic partners who provided financial facilitations and support required for such beneficiary enterprises.
The Program Director General, Mr. Homam Hashem, added that Saudi banks played a prominent role through their participation in the Program in addition to more than 18 finance companies and five business incubators including Saudi Aramco Entrepreneurship Center "Wa'ed" and SABIC's "Nusaned" Initiative.
The "Kafalah" Program offers many financing products covering all critical sectors and supply chains. Mr. Homam Hashem added that the financing products include categories of micro enterprises, small enterprises and medium enterprises as well, such as regular guarantees, start-up guarantees, working capital guarantees, tourism sector guarantees, guarantees portfolio and start-up guarantees portfolio. In addition, a new product has also been launched in cooperation with the Small and Medium Enterprises General Authority (Monsha'at), aka the "Pre-Guarantee Product", noting that enterprises can apply for finance through the Financing Portal - Monsha'at.
The Director General of "Kafalah" Program, Mr. Homam Hashem concluded by praising the concerted efforts of the Kafalah team throughout the past period and their keenness to meet the needs of the beneficiaries and conduct their operations in order to ensure the achievement of their desired objectives in line with the Kingdom's aspirations to realize Vision 2030 and encourage them to do more to serve the dignified youth of the country who operate SMEs.