RIYADH: Saudi Arabia’s Small and Medium Enterprises Financing Guarantee Program, known as Kafalah, extended 5,447 assurances, boosting small-business funding by 8 percent year on year in the third quarter to SR14 billion ($3.73 billion).
The value of guarantees reached SR10.6 billion, up 4 percent from the same period in 2024, while 4,384 small and medium enterprises benefited from the program’s services, the Saudi Press Agency reported.
This underscores the program’s growing role in supporting small businesses as the Kingdom pursues economic diversification under Vision 2030.
Quoting Homam Hashem, CEO of the Kafalah program, SPA reported that this growth in financing “reflects the pivotal role of SMEs in supporting national economic growth, and their contribution to achieving the goals of the Kingdom’s Vision 2030, which aims to diversify sources of income and empower the business sector.”
He described Kafalah as a pioneering model of cooperation between the public and private sectors to enhance access to finance and address business challenges.
Since its inception, the program has approved more than 71,400 guarantees worth SR89.5 billion and supported around 26,500 SMEs, with total financing exceeding SR125.3 billion.
Entertainment-focused SMEs have emerged as strong performers within the program, with a 98 percent year-on-year increase in financing during the second quarter of 2025, according to SPA.
Kafalah supported 32 establishments, issuing guarantees exceeding SR79 million.
The number of beneficiaries in the entertainment segment rose 78 percent from a year earlier. By the end of the second quarter, 94 enterprises had received financing exceeding SR304 million, backed by guarantees totaling SR225 million.
Established in 2006 as a non-profit government initiative, Kafalah helps SMEs secure financing to develop and expand their operations. It provides financial guarantees to banks and other lenders, enabling firms that face difficulties in accessing credit to obtain funding.
The program operates in coordination with the SME Bank and the National Development Fund to foster a sustainable financing ecosystem that supports enterprise growth and economic diversification.
Over the past five years, the program has contributed nearly SR27 billion to Saudi Arabia’s gross domestic product, underscoring its role in expanding the Kingdom’s SME landscape.
Source: www.arabnews.com