- $125M asset-backed facility led by Jefferies, with Channel Capital, marking Jefferies’ first asset-backed financing transaction in the GCC.
- Funding will scale embedded finance at point of sale and accelerate Erad’s regional expansion amid 6× YoY growth.
-
The deal strengthens Erad’s ability to bridge the SAR 900B SME funding gap through fast approvals (48 hours) and strategic partnerships across the region.
Erad, the Saudi alternative financing platform for small and medium-sized enterprises, has secured a $125 million (SAR 470 million) credit facility led by Jefferies, with investment participation from Channel Capital. Once completed, this transaction will represent Jefferies’ first asset-backed financing deal in the Gulf region, supporting the firm’s plans to expand its presence in the Kingdom.
This expandable credit facility comes in light of Erad’s rapid growth, achieving sixfold year-over-year expansion and receiving financing requests exceeding SAR 2.6 billion. The new funding will enhance Erad’s ability to meet the growing demand from SMEs in Saudi Arabia and the wider GCC. Allocations dedicated to Saudi enterprises will be deployed through direct financing funds licensed by the Capital Market Authority, managed by Erad Partners Financial Company.
Founded in 2022 by Salem Abuhammour, Fares Yaghmour, Abdulmalik Almuhaini, and Youssef Saeed, Erad provides Sharia-compliant financing solutions for SMEs, with recent expansions into manufacturing, logistics, distribution, and real estate services, offering financing of up to SAR 10 million per ticket.
Official Statements
Salem Abu-hammour — Co-Founder, Erad
“Our partnership with Jefferies marks a pivotal moment in the evolution of SME financing in the region. By embedding financing options within existing supplier and platform relationships, we are transforming access to working capital into a seamless experience similar to completing a payment. The regulatory support, along with Jefferies’ and Channel Capital’s commitment, underscores the strategic importance of alternative financing in achieving the Kingdom’s SME growth objectives.”
Mark Collier — Managing Director, Jefferies
“We are pleased to partner with Erad and the Channel team on one of the first asset-backed financing transactions in the Gulf. Our collaboration with Erad represents an important step toward improving SME access to capital across the region. We believe Erad is uniquely positioned to deliver this, and the combination of Erad’s advanced technology platform with our global expertise in asset-backed solutions will enable the company to meet the working capital needs of SMEs in the Middle East.”
Johan Nesser — Chief Investment Officer, Channel Capital
“Channel is proud to partner with the Erad team, Jefferies, and all stakeholders involved in this transaction. This represents our first investment in the Kingdom and continues our seven-year track record of Sharia-compliant, asset-backed financing in the Gulf. We are excited to support Erad’s ambitions to empower SMEs across the region.”
Expanding Embedded Finance Across New Sectors
With this transaction, Erad is expanding into new sectors and products, including embedded finance solutions that allow suppliers and commercial platforms to offer integrated financing options at point of sale. This model is already being implemented with strategic partners in healthcare, as well as the food and beverage sector in both Saudi Arabia and the UAE.
The deal further strengthens Erad’s position in closing the SME credit gap, estimated at more than SAR 900 billion in the region, following its recent SAR 124 million debt round led by Stride Ventures. Since its launch, Erad has delivered over SAR 250 million in financing to SMEs across the GCC, supported by a rapid approval system of under 48 hours.
العربية (Arabic) To read the article in Arabic, click here
