Unlocking easier access to finance for Gulf SMEs

In conversation with Karim el-Solh, co-founder and CEO, Gulf Capital

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How effective is current SME financing in the GCC and how can the regional approach be improved? 

SME financing has improved over the past few years, driven by several factors. The first of these is that the incumbent banks have been investing in improving their tech stack to allow for better screening and onboarding. 

Also, we have seen a plethora of launches of fintech companies in the region specialising in this area. These fintechs have benefitted enormously from the encouraging regulatory environment and from extremely supportive regulators, with several sandbox environments launched. 

To accelerate SMEs’ access to capital, more digitisation and artificial intelligence could be embedded in loan decision-making. 

Furthermore, creative structures such as the Buy Now Pay Later model for B2B, supplier financing and revenue share models would further improve the lending environment for SMEs.

What is Gulf Capital specifically doing to improve the ease and efficacy of SME financing operations? 

Gulf Capital, through its portfolio company Geidea, the largest payment company in Saudi Arabia, provides SMEs with a comprehensive payment solution allowing SMEs to accept payments offline and online. 

Moreover, Geidea recently launched its Point of Sale (POS) and Electronic Cash Register (POS/ECR) solutions, allowing retail and restaurant businesses to manage their business via Geidea’s software while accepting payments.

Through these solutions, merchants have the ability to share consolidated data – which is key for onboarding – with various financial institutions with whom Geidea connects the merchants. 

Why is it important to support SMEs, financially and otherwise, as the regional economy diversifies?

SMEs make up the majority of the economy. Supporting SMEs helps achieve social development goals, enhances innovation, accelerates sustainable economic growth and creates job opportunities. It also helps strengthen and facilitate the diversification of regional economies.

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