JAKARTA – A Saudi Arabian financial technology company specializing in small and medium enterprise lending has successfully completed a significant $125 million credit arrangement with global investment bank Jefferies, featuring co-investment from Channel Capital, to accelerate embedded financing solutions throughout the Gulf Cooperation Council region.

The Riyadh-headquartered alternative financing platform erad announced the partnership, which represents Jefferies’ inaugural GCC asset-backed financing transaction and signals the international firm’s strategic commitment to expanding its footprint in the Kingdom.

Strong Growth Trajectory Attracts Major Investment

The financing facility comes as erad demonstrates robust expansion, achieving six-fold year-over-year growth and processing more than $700 million in funding requests. The scalable credit arrangement provides substantial capacity to accommodate increasing demand from small and medium enterprises across Saudi Arabia and neighboring Gulf states.

Capital designated for Saudi SMEs will be distributed through direct financing funds licensed by the Capital Market Authority and managed by Erad Partners Capital.

According to Salem Abu-Hammour, co-founder of erad, the collaboration with Jefferies represents a pivotal development for SME financing throughout the region. The platform’s approach integrates financing directly into existing supplier and platform relationships, making working capital accessibility comparable to standard payment transactions.

Abu-Hammour emphasized that support from regulators, Jefferies, and Channel Capital underscores the strategic significance of alternative finance in advancing the Kingdom’s SME growth objectives.

Addressing Critical Financing Gap

Small and medium enterprises form the cornerstone of the GCC’s economic diversification initiatives, contributing roughly 50 percent of regional gross domestic product and providing employment for two-thirds of the workforce. Despite their essential role in advancing Vision 2030 goals and broader economic transformation across Gulf nations, SMEs confront a substantial $250 billion financing shortfall that constrains their expansion capabilities.

Mark Collier, Managing Director at Jefferies, expressed pride in collaborating with erad and the Channel team on one of the firm’s initial asset-backed financing solutions in the GCC. He characterized the partnership as a meaningful advancement in creating frictionless capital access for Gulf SMEs, noting erad’s uniquely advantageous positioning to deliver such services.

Collier highlighted that combining erad’s proprietary technology platform with Jefferies’ global expertise in asset-backed financing solutions will enable the company to address real-time working capital requirements of SMEs throughout the region.

Regional Expansion and Sharia Compliance

Johan Nisser, Chief Investment Officer at Channel, expressed enthusiasm about joining forces with the erad team, Jefferies, and other transaction stakeholders. He noted this marks Channel’s first deal in the Kingdom of Saudi Arabia and continues the firm’s seven-year track record of Sharia-compliant asset-backed finance in the GCC region.

Nisser stated that Channel looks forward to supporting erad’s ambitions in empowering businesses across the Middle East through this inaugural asset-backed securities financing.

Strategic Product Expansion

Following this transaction, erad is broadening its reach into multiple sectors and product offerings, including embedded finance products that enable suppliers and business platforms to provide integrated financing at the point of sale. The model has already been implemented with several strategic partners, including healthcare and food and beverage product suppliers operating in Saudi Arabia and the United Arab Emirates.

The agreement builds upon erad’s strong operational momentum following a recent $33 million debt financing round led by Stride Ventures. Since launching operations, erad has processed over 250 million Saudi Riyals in financing for regional SMEs through its 48-hour approval process, directly addressing the GCC’s estimated $250 billion SME credit gap.

The platform’s rapid approval timeline and embedded finance approach represent a significant departure from traditional banking processes, which often involve lengthy application procedures and extensive documentation requirements that can delay or prevent SME access to necessary working capital.

This latest financing arrangement positions erad to significantly scale its operations and deepen its market penetration across the Gulf region, providing crucial financial infrastructure to support the growth and sustainability of small and medium enterprises that are fundamental to the region’s economic diversification strategies.

Original Article:

Tech Africa News. (2025, November 30). Saudi Fintech Erad Secures $125M Credit Deal with Jefferies to Boost SME Financing. Retrieved from https://techafricanews.com/2025/11/28/saudi-fintech-erad-secures-125m-credit-deal-with-jefferies-to-boost-sme-financing/