The Kafalah program to support small scale enterprises (SMEs) has launched its 10th edition of awareness campaign (Hold On to Your Dream) at a press conference here recently.
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The total of funding provided by the contributing banks reached above SR25 billion and the value of guarantees (kafalaat) provided to banks during the same period reached more than SR13 billion.
He added that the Kafalah program in cooperation with “Namaa” continues to raise the program’s capital by SR800 million through the private sector stimulate initiative, which in turn contributed to SR1.6 billion. This year till the middle of December the program has increased beneficiaries by 16 percent to reach 1,954 against 1,685 last year.
The value of financing granted by the banks increased to SR4.7 billion from SR3.2 billion, recording a 46 percent jump.
It raised the outstanding portfolio to SR3.8 billion, with a 62 percent increase in financing (kafalaat) worth more than SR2.8 billion compared to SR1.7 billion during the same period last year.
Talat Hafiz, secretary general of the Media and Banking Awareness Committee of Saudi Banks, said year after year, the small and medium enterprises sector confirms its presence and growth in economies of the developed countries, and there are real efforts to maximize its role and contribution to these economies in view of its direct role in creating jobs, diversifying sources of income and enhancing productive and competitive capacity of the national economy, which elucidates the interest and attention this sector enjoys.
Hafiz added that in the context of the Kingdom’s approach of diversified sources of income and the gradual reduction of reliance on oil, in its long-term economic strategies, which were clearly expressed by the Kingdom’s Vision 2030 and the National Transition Program 2020, is to raise the GDP contribution of SMEs from 20 percent to 35 percent.
He described Saudi banks as a major supporter of the development of this sector and that they have harnessed their potentials to ensure the success of the Kafalah program.
The contributing banks loans to SMEs increased to nearly 5 percent of the banks loan portfolio of SR1.4 trillion, compared to 2 percent two years ago, indicating that it targets to reach 5 percent in 2020.
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