Saudi-Made SMEs are Making Saudi’s Future Brighter

The Kingdom is well on its way toward Vision 2030 – an ambitious plan to diversify the nation’s economy. The growth of SMEs has largely contributed to the ongoing progress of the nation. Not only are SMEs boosting the GDP of the country, but they have also created employment for over 6 million people, as highlighted by the Minister of Human Resources and Social Development Eng. Ahmed Al-Rajhi at the launch of Biban 2023 in Riyadh.?

The growth of SMEs is contributing to multiple goals highlighted in Vision 2030 and KSA’s continuous focus on SME development is proving to be a step in the right direction.

Announcement of The New Companies Law

The government has played a significant role in advancing the SME ecosystem. Last year, for example, the Kingdom approved a new Companies Law that has made it easier to do business in the nation. The law, enacted earlier this year, was revised only six years after its previous edition. This quick turnaround shows that the nation is making steadfast moves to create a favorable environment for the growth of the private sector.?

Most significantly, the new Companies Law, under Article 19, has simplified statutory requirements for SMEs to encourage more startups in the nation. While all companies in KSA are required to have a qualified auditor, new SMEs are now exempted from this requirement, easing the burden of starting a new venture.

This stride is only one under a myriad of steps taken by the government to empower KSA’s private sector. With this goal in mind, the new Companies Law introduced a new type of enterprise - the Simplified Joint Stock Company (SJSC). The primary goal of the SJSC is to boost entrepreneurship and attract venture capital investment in the nation, as it allows for a single person to start a company without any minimum capital requirement.?

The impact of these changes is already visible in Saudi’s SME ecosystem. In March, only two months after the law was enforced, there was a whopping 25% increase in revenue for SMEs in traditional sectors, such as manufacturing, F&B, and retail, as reported by Huda Al-Lawati, founder of Aliph Capital.?

Lamaa has been collaborating with top Saudi-made SMEs since our inception. Our Fintech products help SMEs solidify their finance and take the much-needed leap of faith to expand their business offerings.?

In line with this vision, Lamaa participated in Biban 2023 last month. Biban is another such initiative by Saudi that focuses on opportunities for SMEs in Saudi. The event saw the announcement of huge investments into the entrepreneurship and SME sector, including a pledge of 11 billion riyals by Saudi financing agencies. Such initiatives will further promote economic activity and make the nation’s SME ecosystem even stronger.?

Fintech Can Help SMEs Scale Faster

Fintechs in the B2B sector have aided the growth of SMEs all over the world. In today’s world, it is vital for SMEs to scale quickly to be able to compete in more significant markets. Such expansion requires access to finance that Fintechs, such as Lamaa, can provide. Lamaa’s Dynamic Discounting helps SMEs gain working capital to facilitate expansion by enabling early payments. Through this platform, Saudi-made SMEs can continue to provide services on credit, benefitting buyers, while maintaining their cash flow and growing their business.?

A word from Lamaa

The end of the first quarter of 2023 saw the growth of SMEs skyrockets. In an effort to give new ideas home in Saudi, the nation continues to build an environment that supports new ventures and fosters innovation. For SMEs to reach their full potential, innovation in business practices is a must. Through Lamaa’s innovative solutions, SMEs can scale their operations to serve a bigger market and aid the nation in making Vision 2030 a reality.??

To learn more about our products and offerings, please visit www.lamaa.sa