Saudi Fintech Erad Secures $125M Credit Deal with Jefferies to Boost SME Financing

erad,  the Riyadh-headquartered alternative financing platform for SMEs, has partnered with Jefferies  (with co-investment from Channel Capital) to secure $125 million in a credit deal, to accelerate embedded finance solutions across the GCC. Once the transaction is finalised, it will mark Jefferies’ first GCC asset-backed financing transaction, and will support the firm’s plans to grow their presence in the Kingdom.

Building on erad’s strong 6x year-over-year growth and over $700 million in funding requests, the scalable funding facility offers significant expansion capacity to meet growing demand from SMEs in Saudi Arabia and the rest of the GCC. Funds allocated for Saudi SMEs will be deployed through CMA-licensed direct financing funds managed by Erad Partners Capital.

“Our partnership with Jefferies represents a transformative moment for SME financing in the region. By embedding financing directly into existing supplier and platform relationships, we’re making working capital as accessible as a payment transaction. The support from the regulators, Jefferies and Channel Capital, demonstrates the strategic importance of alternative finance in supporting the Kingdom’s goal of SME growth.”

– Salem Abu-Hammour, Co-founder,  erad

SMEs represent the backbone of the GCC’s economic diversification efforts, contributing approximately 50 percent of regional GDP and employing two-thirds of the workforce. Despite their critical role in driving Vision 2030 objectives and other economic transformation across the Gulf states, SMEs face a significant $250 billion financing gap that limits their growth potential.

“We are proud to work with erad and the Channel team on one of our first asset backed financing solutions in the GCC, and our partnership with erad represents a significant step forward in creating seamless access to capital for GCC SMEs which we think erad are uniquely well positioned to provide. The combination of erad’s proprietary technology platform with our global experience in asset backed financing solutions will enable erad to address the real-time working capital needs of SMEs across the region.”

– Mark Collier, Managing Director, Jefferies

“Channel is proud to team up with the Erad Team, Jefferies and other stakeholders involved in this transaction, our first in KSA and a continuation of our seven years of sharia compliant asset backed finance in the GCC region. We are excited to support the aspirations of Erad in powering businesses across the middle east region in this inaugural ABS financing.”

– Johan Nisser, CIO, Channel

Following this transaction, erad is expanding into multiple sectors and products, including embedded finance products, enabling suppliers and business platforms to offer integrated financing at the point of sale. The model is already live with several strategic partners, including suppliers of healthcare and F&B products in Saudi Arabia and the UAE.

The deal builds on erad’s strong momentum following its recent $33 million debt financing round led by Stride Ventures. Since launch, erad has processed over SAR 250 million in financing for regional SMEs with its 48-hour approval process, addressing the GCC’s estimated $250 billion SME credit gap.