Kafalah SME Guarantees Top SAR 100 Billion

The Kafalah program's financing guarantees for small and medium enterprises have surpassed SAR 100 billion, a milestone that reflects the growing role of guarantee-backed lending in supporting Saudi businesses. The guarantees have enabled financing of more than SAR 140 billion for over 28,000 small and medium enterprises across the Kingdom.

Kafalah-backed financing represents about 8% of total SME financing in Saudi Arabia, which reached SAR 489 billion by the end of the first quarter of 2026. The program, launched in 2006, has approved more than 70,000 guarantees since its start.

How the program works

Kafalah does not issue direct loans. Instead, it provides financing guarantees to partner banks and finance companies, typically covering up to 80% of a loan's value, and up to 90% for priority sectors and enterprises. The maximum Kafalah-backed financing for a single enterprise is around SAR 10 million, with loan tenors following the lender's terms, commonly one to ten years.

Businesses apply first to a participating bank or finance company. After initial credit approval, the lender submits a guarantee request on the enterprise's behalf through the program's electronic channels. Kafalah then reviews the enterprise's revenues, sector, and business plan, and issues a guarantee if approved. Processing generally takes about 15 to 30 days after the bank's initial approval. An annual guarantee fee of about 1–3% of the guaranteed amount applies, paid by the enterprise as part of its financing cost.

Eligibility focuses on Saudi enterprises registered with the Ministry of Commerce, with annual sales below about SAR 200 million and fewer than 250 employees, holding a valid commercial registration. Eligible sectors include manufacturing, services, trade, agriculture, tourism, technology, and Vision 2030 priority sectors. For many small and medium enterprises, the guarantee lowers a common barrier to bank financing, helping firms access capital to grow, hire, and expand.

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