During a workshop held in the Asharqia Chamber
MONSHEAT and KAFALA announce specific initiatives to support SMEs
The General Authority for Small and Medium Enterprises (MONSHEAT) affirmed its keenness to support these enterprises through many initiatives, programs and activities, not necessarily financing, but includes consultations, follow-up, training and awareness, most notably the launch of a specialized bank for these enterprises, and work on the electronic tape between the facilities and the authority , And the funding agencies on the other hand, as well as the allocation of funds to achieve the principle of sponsorship adopted by the government program,
This came during a workshop held in the Asharqia Chamber on Wednesday 20/11/2019, moderated by the Vice-Chairman of the Finance Committee in the Eastern Chamber Zaid bin Abdullah Al-Ya'esh, and spoke during which Badr Al-Radhan (Director of Corporate Finance Department of the Authority), and Mohammed Al-Khowaiter (from the Kafala program), as The importance of the role of these enterprises in achieving growth and supporting the requirements of the Kingdom's Vision 2030 was emphasized.
Al-Radhan said that "MONSHAET" had adopted a number of initiatives worth about 12 billion riyals, including: “bold investment, indirect lending, recovery of government fees, and strengthening of the Kafala program”. Among them are several sub-programs: bold investment falls under the programs of investment in start-up companies, investment in funds and investment with participation has been under these programs 21 deals, worth up to 2.8 billion riyals, note that the amounts approved for investment by enterprises in more than one billion riyals.
And the recovery of government fees initiative are designed to support small and medium enterprises and growth has during the first years of work, and this is done through compensation for the value of 8 fee government, has benefited from this initiative 7,000 facility through 24.435 process, and has been restored government charges $ 650 million riyals.
He pointed out that the financing adopted by establishments is proceeding according to three models (lending finance, capital financing, and alternative financing), and we are working to implement the idea of crowdfunding, while lending finance includes restructuring and raising the capital of the Kafala program, and tend indirect lending (finance companies) Registration of collateral, working with credit information companies to include SMEs, launching the SME Bank, and establishing an alternative lending system for SMEs and peer lending.
The capital funding is to launch several funds, including funds for the financing of the Fund, and the investment fund run government and the alternative financing is to provide financial and technical solutions to stimulate funding from non-profit entities.
He explained that the target sectors are well-known economic activities, namely: agriculture, services accommodation and catering, and the activities of the administrative and support services, transportation and warehousing, real estate activities, education, health, manufacturing, arts and entertainment, information and communications and others .. stressing at the same time that the Commission as being evaluation of the performance of the process of taking into account several indicators, including the use of the loan ratio of the target sectors, or for customers, and the number of beneficiary enterprises.
As for funding awareness, he explained that some beneficiaries lack some information needed to obtain funding, so that some of them do not need funding, so we have cooperated with 35 government and non-governmental bodies to inform the beneficiaries of financing options for entrepreneurs, and mechanisms to benefit from them, has benefited from this program 818 people during the This year, he explained that the Authority is seeking to automate the financing process to facilitate the access of enterprises to lending and investment opportunities, through a financing portal that connects entrepreneurs with funding bodies.
Another part, Mohammed Al-Khowaiter (from Kafala Establishment Financing Program) said that the program was established in 2006 as a joint development initiative between the Ministry of Finance and Saudi commercial banks. A percentage of the risk of the financing agency in the event that the sponsored activity fails to repay the financing or part of it.
He added that the program adopts the principle of providing financial guarantees to enhance the opportunity for small enterprises and medium necessary funding through strategic partnerships and national cadres and tools innovative technology backed by knowledge bases, adding that the program government has partnerships with 30 point, including 26 bank hand and financing, as well as four government agencies.
He said that the benefit of the program starts with the application, which is submitted to the funding bodies and then to the program .. Stressing that the targeted enterprises are small, medium and micro enterprises and the value of the guarantee between 2.5 million riyals to 15 million depending on the establishment and its activity and the funding agency,
He said that the program, which was launched during the period from 2006 until the end of the third quarter of this year has ensured 7,321 facility, granted by about 30.9 billion riyals, and the value of guarantees issued by the program 16.9 billion riyals.
