SME

FUNDING SCHEME CONTINUES TO GIVE IMPETUS TO SAUDI SMES

Saudi Arabia has poured nearly SAR 30 billion in its development Development ecosystem in the first quarter of 2023.The effort was led by the Notional Fund (NDF) and its supervised development funds and banks. It was in line with the objectives of Saudi Vision 2030 strategy, which aims to drive economic, social, and cultural growth, and maximise the developmental impact on the national economy, especially in building the capacity of small and medium enterprises (SMEs).

Among the initiatives include Saudi Industrial Development Fund’s (SIDF) approval of more than SAR 875 million for 24 businesses in collaboration with the Small and Medium Enterprises General Authority (Monsha'at). The project focused on providing support with initiating industrial projects, empowering entrepreneurs, and facilitating their entry into the industrial sector. SIDF also supported over 100 beneficiaries through academic and advisory programmes.

In the tourism sector, the Tourism Development Fund (TDF) approved financing of more than SAR260 million for 11 businesses in the sector. TDF served 57 beneficiaries through pre-financing counselling and ogistical support programmes. The fund sponsored significant events like the Foras Forum and Biban 23 Forum, and signed memorandums of understanding with local and international companies to attract private sector investments.

The Cultural Development Fund (CDF) was also given a boost with support of around SAR 15 million and issued guarantees of SAR 16 million to boost cultural projects. The fund launched a programme for financing the film sector with a budget of SAR 879 million as part of the Ignite initiative. The aim is to encourage a vibrant and sustainable film sector by providing financing packages for feature films and series, empowering investors, and supporting authors, artists, and cultural content creators.

 

ACCELERATING START-UP CULTURE

Building human capital is another key cornerstone project. The Human Resources Development Fund supported over 836,000 individuals and 73,000 enterprises to the tune of more than SAR 2.2 billion. Their employment support programmes, empowerment programmes, job search assistance, and training contributed to the employment of over 96,000 individuals in the Saudi labour market.

The fund also launched its new strategy and identity, focusing on empowering the private sector's role in Saudisation and strengthening partnerships for training and employment.

In addition, the Small and Medium Enterprises Bank provided more than SAR 1.1 billion in financing to 301 SMEs through the financing portal and indirect lending initiative, in collaboration with its partners.

During the first quarter of 2023, the Social Development Bank (SDB) provided financing to approximately 9,000 individuals, freelance beneficiaries, and small and emerging enterprises, with values amounting to SAR 454 million, SAR 1.5 billion, and SAR 1.1 billion, respectively.

The Real Estate Development Fund (REDF) served about 21,000 beneficiaries of housing support programmes, enabling them to sign financing contracts totalling SAR 13.7 billion. The REDF deposited over SAR 2.7 billion to "Sakani" beneficiaries, continuing its contributions to the Housing Programme of Saudi Vision 2030. The real estate advisor service of REDF recorded new beneficiaries, and issued financing and housing recommendations.

Meanwhile, the Agricultural Development Fund injected more than SAR 2.6 billion in financing to more than 2,08 individuals and 21 establishments during the first quarter of 2023. It financed various projects as diverse as small farmers and breeders, poultry projects, greenhouse projects, fish production in inland waters, and dates production. The fund also approved financing to construct silos for storing grains in three locations in the kingdom, in addition to financing the import of agricultural products targeted in the food security strategy.

 

 

INVESTING IN HUMAN CAPITAL

Other large entities are also boosting start-ups and sowing the seeds of entrepreneurship. The Ministry of Communications and Information Technology (MCIT), PepsiCo, and AstroLabs teamed up to launch the 'Scale Up Accelerator' programme and support digital entrepreneurship. The programme was designed to boost SMEs and help launch their first e-commerce websites. Highlights from the top 40 participants reflected outstanding digitisation and entrepreneurship skills. Eighty digital marketing campaigns were launched, 30 new websites were built, and 30 new business models were introduced to reveal 10% revenue growth for over half of the cohort's top 40.

The programme, sponsored by PepsiCo's philanthropic arm, unleashed the full potential of SMEs in the kingdom by enabling the transformation of local businesses into e-commerce interfaces. In its first edition, the programme selected 103 contestants from more than 250 participants based on their business capabilities and models, and the diversity of their cultural backgrounds.