About the Program
The KAFALA program provides bank guarantees that unlocks funding and support for SMEs by reducing lending risk. It provides financial guarantees to support enterprises with the necessary funding through strategic partnerships, national capabilities, and innovative data-driven technology tools.
Support SMEs accessing funding.
Encourage financial institutions to do business with SMEs.
Attract new SME founders.
Activate the role of SMEs in generating job opportunities.
Develop promising sectors.
Support projects managed by women.
Working to help enterprises maintain and boost their growth.
Bridges the funding gaps within startups whose operating life-cycle is less than 3 years, emphasizing strong early stage growth in order to increase the number of sustainable startups.
Enhances and promotes franchise expansion and brand activity by guaranteeing the funding of establishments holding or granting a franchise.
Supports e-commerce as a driver of business growth, and promotes existing enterprises by introducing funding solutions for micro, small and medium enterprises operating in the communications sector.
Supports and develops national industries and logistics through the funding guarantees for supply chains in the industrial sector, and transport and storage sector.
The banking entities that collaborate with the program and grant funds and credit facilities for SMEs include:
The National Commercial Bank, Sabb Bank, Riyad Bank, Arab national Bank, Bank AlJazira, Samba Financial Group, The Saudi Investment Bank, Al Rajhi Bank, Alawal Bank, Al Bilad Bank, Banque Saudi Fransi, Alinma Bank, Emirates NBD.
And the collaborating funding companies are:
Gulf Finance Corporation, Saudi ORIX Leasing Company, Bab Rizq Jameel Microfinance, Alamthal Financing Company, Saudi Finance Company, Al-Jasriya Finance Company, Osoul Modern Finance Company, Tawkelat Financing Company, Al Yusr Leasing & Finance, Maalem Financing, Al Yusr Leasing & Finance, Nayifat Finance Company, Morabaha Marina Finance Company, Abdul Latif Jameel Finance.
The value of the guarantee ranges between SAR2.5 million and SAR15 million. The coverage can reach as high as 90%.
The program does not provide the funding directly, rather it issues a guarantee for the benefit of the lending entity and assumes a percentage of the financing risk.
The guarantees requested by the funding entities is the program’s method to reduce risk. The funding entities may request other additional guarantees as needed. However, guarantees requested by the sponsorship program are limited to the personal guarantees of the owner of the establishment or company that cover the guarantee amount.
The program guarantees cover for all economic activities except the following:
Activities not included in the definition of small and medium enterprises.
Financial or real estate speculation and funding projects.
Activities violating laws and regulations of Saudi Arabia.
Personal and real estate loans.
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