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6/30/25, 3:13 PM Bridging the liquidity gap for small businesses in the Middle East | Khaleej Times
Contrary to the old-school thinking where collateral was the only valid form of assessment for lending
SMEs, AI-assisted Bright underwriting models today have made it possible for fintech to assess
SMEs primarily based on real-time business performance. The alternative data required for building
accurate, data-led risk profiles to facilitate faster and more just credit decisions include transactional

histories, current inventories, and habits of digital payments. Within the UAE, Beehive and Tabby
offer small business lending and buy now, pay later solutions, while Rasan and Tamara target
underserved business segments in Saudi Arabia through embedded finance and AI.

Payment acceptance instruments embedded in finance allow SMEs instant payments, independent
of wallets, net banking, and cards, compressing the payable cycle from months to minutes.
Automated invoicing, cash flow, and reconciliation tools effectively eliminate traditional working

capital bottlenecks, enabling SMEs to capitalise on unexpected opportunities in the digital economy.

Even in supply chain finance, once the preserve of large corporations, new B2B fintech players are

democratising access to this market. By enabling instant transfers and dynamic discounting models,
they help SMEs smooth out cash flow and invest strategically in growth. Still, a major challenge
persists — many SMEs do not have the digital infrastructure or credit visibility to take full advantage
of these platforms, so even the most innovative solutions don’t go far enough. Evolution is no longer

optional but existential. Financial institutions that do not embed these capabilities risk complete
obsolescence as SMEs will find greater refuge in responsive and integrated alternatives. Instead, the
entire policy ecosystem must focus on underpinning platforms for collaboration and seamless
integration on which fintechs and SMEs can mutually thrive.

Policy push alone won’t close the gap

There’s no doubt that the Khalifa Fund, Saudi Arabia’s SME Bank, and other government-backed
initiatives are critical enablers. However, policy alone cannot deliver systemic change unless the
underlying financial infrastructure evolves in tandem with it. SMEs do not need more complex loan

applications or longer assessment periods; they need real-time credit decisions, cash flow-based
underwriting, and flexible financing options that reflect the dynamic nature of modern business.

Ultimately, bridging the liquidity gap demands more than capital — it requires control, speed, and
digital adaptability. A system that enables SMEs to act like big businesses — fast, flexible, and future-
ready — is no longer aspirational. It is essential for the Mena region’s economic ambitions.

Final reflection

The region’s SME sector stands at a tipping point. The goals set by Saudi Arabia’s Vision 2030 and

the UAE’s national strategies are bold and achievable. However, they will only be realised if the
financing models evolve in tandem with the realities of SMEs. Policymakers, banks, fintechs, and
ecosystem players must shift their perspective on SMEs, moving beyond a legacy lens to recognise
them as the cornerstone of a diversified, digital-first economy.

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