Financing construction projects is a constant struggle for small-and-medium sized (SME) contractors. Most contractors cite working-capital crunch as the leading cause of project delays and, in some cases, business closure.

But in the last few years, things have drastically changed for the better. The Kingdom’s Vision 2030 reform package has had a telling effect on the construction sector’s financing capabilities, directly benefiting SME businesses in the sector.  

Earlier, contractors looking to finance construction projects would face delays because of the lengthy procedures involved in getting approvals for government funding and loans. The processes were strewn with bureaucratic red tape. Such challenges naturally slowed project turnouts. But a series of recent government initiatives brought some smooth solutions aided by the overall digital transformation of the government agencies – enabling genuine SME entrepreneurs to lay a claim to the Kingdom’s burgeoning construction industry.   

Small and Medium Enterprises (SME) Bank

Arguably the most focused initiative aimed at SME businesses, in general, was the inauguration of the SME Bank, established with the vision to increase the share of the general SME sector from 20% to 35% of Saudi Arabia’s GDP by 2030. 

Affiliated to the National Development Fund, the SME Bank was set up in 2021 to support the growth of the SME sector and bridge the financing gap by providing the necessary services and enhancing financial institutions’ contribution.

The bank’s support does not stop at entrepreneurs who own businesses in the Kingdom only but goes beyond its borders to support any business wholly owned by Saudi citizens around the world. 

How can a contractor apply for financing through the Small and Medium Enterprises Bank?

All you have to do is follow the simple steps:

  • Visit
  • After identifying the product that suits your needs, choose “Apply Now.”
  • When you go to the finance portal, login through the national access service
  • Through the finance portal interface for small and medium enterprises, click on “Request Finance”

Finance Gate: It is an electronic platform that connects financiers from government agencies and the private sector with small and medium enterprises wishing to obtain financing and enables them to choose suitable financing offers.

  • Select the commercial registry of the establishment for which you want to submit a financing request, then click “Continue.”
  • Select the required product from the list of products, then click “Submit.”
  • After reading and agreeing to the terms and conditions, click on “Agree and Continue.”
  • Then an interface appears that includes four steps to apply, fill in the required data
  • Share the funding request and select at least one funding agency, or select Select All
  • Finally, click on “Submit Request.”

The website of the Small and Medium Enterprises Bank provides a package of digital services that enable users to follow the news of the bank or institution if they wish to obtain financing. 

To communicate with them, choose between financing products that suit their specific needs, apply for financing, and follow it up until it is approved. 

Commercial banks and local financial institutions that cooperate with the Small and Medium Enterprises Bank:

The SME Bank cooperates with major commercial banks and local financing institutions in the Kingdom to provide financing at a competitive profit margin and reduce financing costs. It offers several financing services and products that support the growth and expansion of small and medium enterprises to ensure their success and continuity in the market.

We mention, but not exclusively, one of the most important banks on the list of facilities banks and the services it provides to contractors:

Banque Saudi Fransi: It provides integrated financial services to its clients from contractors in various contracting, operation, and maintenance sectors.

Other banks: The Saudi British Bank, Riyad Bank, Arab National Bank, Al Bilad Bank, and Al Jazira Bank.

The financing companies Local: Al-Amthal Company, Tawkelat Company, Al-Oula Finance Company, Al-Raeda Finance.

Electronic platforms: The list of financial technology (fintech) companies includes the Lindo platform and the Manafa platform for cooperation with the proxy financing program to finance small and medium enterprises.

What if I do not have guarantees to request a loan or financing for my facility?

The government has noticed the fact that certain businesses cannot provide guarantees to obtain a loan or financing. So it introduced Kafalah, a non-profit initiative that enables small entrepreneurs to obtain necessary financing from all commercial banks and financing institutions.

Cooperating with the program licensed by the Central Bank of Saudi Arabia and granting loans and credit facilities to the facility, Kafalah also aims to attract a new segment of facility owners who have yet to deal with financing agencies previously.

How to apply for a financing guarantee?

  • The entrepreneur or the business owner submits a request for financing to the parties cooperating with the guarantee program directly or through the financing portal supervised by the Small and Medium Enterprises Authority “Monshaat.”  Provided that they fulfill all the application requirements and submit copies of the relevant documents related to their business activity.
  • Then comes the role of financing agencies, which study the application in light of the applicable standards and approval of their policies. If they need guarantees to cover risks, the application is referred to the program to study its guarantee.
  • Once approved, a guarantee is issued in favor of the financing entity. The program notifies the financing entity and the customer of the approval of issuing the guarantee to complete the necessary procedures for obtaining financing.

The program charges a nominal annual administrative fee in return for studying the funding guarantee request, which the concerned funding agency pays in its favor.

Amlak’s innovations are Sharia-compliant solutions for an established contracting company.

Suppose you are a contracting company searching for financial solutions for a huge project with transactions that comply with the provisions of Islamic Sharia. In that case, Amlak International Real Estate Finance Corporation is your ideal destination, as it is the first licensed company to practice real estate finance activity in the Kingdom from Saudi Arabia’s Central Bank “SAMA.” 

The Foundation provides businesses with innovative real estate financing solutions according to modern needs and Islamic Sharia provisions under religious scholars’ expert guidance.

The Kingdom has spared no effort to facilitate the expansion of SME players in the construction sector, as it is one of the most important pillars of the national economy. The government recognizes the sector’s pivotal role in achieving sustainable development. The sector is growing at one of the fastest rates ever in the region. If you were thinking of putting on the entrepreneur’s hat and jumping into the construction business – the time has arrived!



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