(MENAFN - Arab News) The Kafala program has approved 188 guarantees for Saudi young businesswomen out of 4,268 women from 2006 through the third quarter of 2012.
By guaranteeing the businesswomen, the program will help them launch their small and medium enterprises (SMEs). The approvals account for just 5 percent of women applicants.
Forty-one percent of the guarantees approved for women entrepreneurs were directed to commercial activity, 22 percent for construction sector, 17 percent for social and personal services; 15 percent for industrial activity; and the remaining 5 percent for other activities, the Saudi Press Agency quoted Acting Chairman Osama bin Abdulrahman Al-Mubarak.
He said the share of Saudi women entrepreneurs is still modest compared to program's aspirations where their absence or low-scale contribution will negatively affect the map of investment and the national economy as a whole, particularly in the presence of huge funds remained un-invested in banks owned by Saudi women.
Investments of Saudi businesswomen represent about 6 percent of the private sector's total investments in the Kingdom. The total number of commercial registrations owned by businesswomen in the Kingdom represents 14 percent of the total number of registered businesses, he said.
Since the beginning of 2006 to the end of August, the Kafala program issued 4,156 guarantees for 2,564 SMEs valued at SR 1.95 billion. Banks and other financing institutions provided funding facilities worth SR 4.21 billion.
Kafala Program is a joint effort between the Ministry of Finance, represented by the Saudi Industrial Development Fund (SIDF) and Saudi banks.
The program aims to promote financing to the SME sector in the Kingdom. Through the program, the banks offer finance to customers up to SR 2 million whereas Kafala Program issues guarantee to the bank, covering up to 80 percent of the required financing.