Riyadh,25 September 2024 - Under the patronage and presence of His Excellency Youssef Al-Benyan, Chairman of the Board of Directors of the Small and Medium Enterprises Bank, the Kafalah Program for Financing Guarantees of Small and Medium Enterprises held a ceremony honoring its successful partners from both the public and private sectors. The event recognized their support and efforts in financing small and medium-sized enterprises (SMEs) in Saudi Arabia, a key pillar in the Kingdom's economic development strategy within Saudi Vision 2030.
The Chairman of the board of Kafalah Program, Mr. Abdulrahman bin Mansour, delivered the opening address, emphasizing that the Kafalah Performance Excellence Award aims to motivate financial institutions to with the SME sector and support development programs actively engage with the SME sector and support development programs. This also includes expanding the reach of financing to include a new segment of enterprises that have not previously accessed funding, thus contributing to the growth of the national economy.
Mr. Homam Hashem CEO of the Kafalah Program, announced during the event that the program has reached over SAR 100 billion in financing Loan guarantees in partnership with various financial institutions. These collaborations have resulted in funding over 23,000 enterprises, funding over 23,000 enterprises, financing over 23,000 enterprises, and creating nearly one million jobs. Additionally, the program has established 100 partnerships with both public and private sectors, highlighting the fruitful cooperation that has led to this national achievement.
Kafalah honored its successful partners from the public and private sectors for their contributions to supporting SMEs. Among the recognized public entities were the Saudi Central Bank, the National Development Fund, the General Authority for Small and Medium Enterprises, the Tourism Development Fund, the Small and Medium Enterprises Bank, the Cultural Development Fund, the General Entertainment Authority, the General Authority of Awqaf, and the National Information Technology Program. On the private sector side, the Kafalah Excellence Award was presented to Riyad Bank, Arab National Bank, The Saudi National Bank, Bank Albilad, The Saudi First Bank, Abdul Latif Jameel, Alamthal Company, Al-Raeda Financing, tc. The success of this event was further highlighted by the participation of The Saudi National Bank and Riyad Bank as platinum sponsors and The First Saudi Bank as a gold sponsor.
During the ceremony, Kafalah also received two prestigious global awards for innovation: one for the most innovative product globally and the other for the most innovative guarantee program, awarded by the SME Finance Forum (IFC) . These recognitions come as a result of the program's transformation in the issuance of guarantees and automation of processes with financial institutions as part of the conferences held in conjunction with the G20 Summit.
notably,the program has successfully issued 64,494 guarantees, with a total value of SAR 72.5 billion. Twenty-seven enterprises funded by the Kafalah Program have transitioned from medium-sized enterprises to the parallel market. At the same time, 8% of micro-enterprises have grown into small and medium-sized enterprises, and 4% of small enterprises have grown into medium-sized businesses.
As part of its ongoing efforts, the program has seen a 166% growth in guarantee issuance between 2019 and 2023. The time required to issue a guarantee has been reduced from 48 working days to just 36 hours while maintaining the same number of decision-makers, thanks to modern mechanisms that rely on artificial intelligence. In addition, the program supports all Vision 2030 initiatives, having assisted with18 different programs.
Furthermore, economic studies in collaboration with King Fahd University of Petroleum and Minerals Research Center revealed that enterprises benefiting from the Kafalah Program have experienced a 17.3% increase in employment compared to similar enterprises that relied on traditional financing methods. Over the past five years, the Kafalah Program has contributed almost SAR 27 billion to the Kingdom's GDP.
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