16/03/2011
Representatives of local banks offering mechanisms to support small enterprises and defend cases of not funding
Throughout the Young Businessmen Council meeting at Asharqia Chamber
Al-Nuaim: We support small enterprises and will continue to do so
Al-IBrahim: Firm's over supports put it in trouble
Al-Mulhem: We support facilities as a matter of social responsibility
Three major representatives of local banks showed their willingness to finance small and medium enterprises in various projects under some conditions that ensure its continuity in the work, and avoid the risk of failure ..That was during the meeting of Young Businessmen Council held yesterday Monday March 14, 2011 at the Chamber in the presence of Adel Al-Serami, Secretary General Assistant of Economic Affairs and Chairman of the Council Khalid Al-Dabal and the board member Omar Al-Jerivani.
Officials have expressed their willingness to examine funding requests through concerned branches and departments or through bank websites or even by phone ;each of Raed Al-Nuaim from the Banking Group of Eastern Region and Ibrahim Al-Ibrahim Director of Corporate Banking in Al-Riyadh Bank, and Nayef Al-Mulhem, Financing Manager from the NCB.
For his part, Al-Ibrahim said that the bank has a long history of providing support to small and medium enterprises, as in 2005 it has established a specialized centers to support SME's, as currently we have two main centers in Dammam and Al-Khobar, as well as three other subordinate offices to it in Al-Qatif and Al-Ahsa through which can communicate with the bank's services.
As for Al-Mulhem who stated that the bank has 35 branches in the Eastern region providing these basic services for small enterprises with less revenue for 20 million riyals per year, where we contribute to the financing of courses (How to start your small business, and (How to start your own business from home) in cooperation with Asharqia Chamber.
Speaking on the facilities provided by banks; officials have confirmed their willingness for this according to certain conditions.
In this regard; Al-Nuaim pointed that any firm requests funding from the Bank is being measured and evaluated by feasibility study to determine the level of funding and support.
And on the mechanism of risk assessment, Al-Ibrahim said that there is a risk of the activity itself, some with high risk, such as food sector. And there are financial risks from the financial indicators of the institution, such as volume growth from year to year, by looking at the existing financial statement and income, as well as credit risk which determines the debtor ability of payment, referring to the marketing risks to be taken into account, and therefore the Bank decides whether or not to grant funding.
And on the feasibility study Al-Nuaim said that it is necessary and based on the conviction of the bank in this study and the ability of the client .. Stressing that the financing of small enterprises is difficult but not complicated.
The meeting turned to speak on "Kafalah" program which ensures the support adopted by the Kingdom for the benefit of small and medium enterprises. .
Al-Mulhem said in this regard; "Kafalah Program "is the guarantor of the Fund and not a lender, in which it ensures 50% of the loans up to 75% if the loan is intended for a small enterprises and it is being offered through banks ..
Pointing that the National Commercial Bank through this program spent 145 million riyals on this to ensure 867 until 2009.
Representatives have denied that their banks are not interested in small enterprises, and that its work is limited for of large enterprises ,stressing that banks are always in the process of evaluation of studies in the absence of consultation organizations that should take this role as they have also assigned special sections for small enterprises.
