Saudi Arabia-based alternative financing platform erad has raised $22 million in a Series A funding round to expand its SME financing business across the Gulf Cooperation Council. The round was led by Middle East Venture Partners, with participation from new investors Saudi Venture Capital, 500 Global, S60 Ventures, ANB Capital, Conjunction Capital, and Araya Ventures. Existing backers Khwarizmi Ventures, Nuwa Capital, Aljazira Capital, Oraseya Capital, and Joa Capital also participated in the financing.
Scaling SME Financing in Saudi Arabia
The investment follows a period of rapid expansion for erad, which said its Saudi business has grown eightfold year over year. The company has deployed more than SAR 500 million, approximately $133 million, in cumulative financing to small and medium-sized enterprises while receiving over SAR 4 billion in financing requests. That gap between capital deployed and demand highlights the continued need for alternative working capital solutions among businesses across the region.
erad provides Shariah-compliant working capital financing of up to SAR 10 million to companies across sectors including healthcare, food and beverage, logistics, manufacturing, retail, and wholesale distribution. Its platform uses proprietary data and artificial intelligence models to assess cash flows, evaluate risk, and process financing applications more efficiently. According to the company, eligible businesses can receive approvals within approximately 48 hours.
Expanding Into New Sectors and Markets
Following the Series A, erad plans to broaden its financing products and deepen its presence across the GCC as demand increases from more capital-intensive industries. The company is targeting sectors including industrials, logistics, and manufacturing, where businesses often require flexible capital to fund inventory, equipment, expansion, and larger commercial contracts. It also plans to expand its regional workforce through additional hiring across technology and commercial functions.
Co-founder Salem Abu-Hammour said the company is seeing businesses increasingly prioritize faster access to capital as they expand into new markets and sectors. erad says its financing has been used by clients to support initiatives such as fleet expansion, inventory purchases, new locations, and larger customer contracts without restricting operating cash flow. The company added that 85% of its customers expand their financing relationship within their first year on the platform.
Investors Target the GCC Financing Gap
MEVP said its investment reflects confidence in erad's technology-driven underwriting model and its ability to address the financing needs of SMEs across the region. The investor highlighted what it described as a roughly $250 billion SME financing gap across the GCC, alongside erad's growth and operational execution in Saudi Arabia. MEVP also pointed to the company's use of technology and risk controls as important elements in building a scalable financing platform.
SMEs remain a significant part of the Gulf economy, supporting employment and contributing to economic diversification efforts across the region. Alternative lenders have increasingly sought to address financing gaps faced by smaller businesses that may struggle to access conventional bank lending quickly or on flexible terms. erad is positioning its digital underwriting infrastructure as a way to provide capital more efficiently while maintaining structured risk assessment.
Building a Regional Financing Platform
Founded in 2022 by Salem Abu-Hammour, Faris Yaghmour, Abdulmalik Almeheini, and Youssef Said, erad currently serves businesses in Saudi Arabia and the United Arab Emirates. The company's model combines technology-based underwriting with Shariah-compliant financing products designed to meet short-term and growth-related working capital requirements. The latest funding gives erad additional resources to introduce new products, increase financing capacity, and serve a broader range of companies.
erad's $22 million Series A marks a significant step in the company's effort to scale alternative SME financing across the GCC. With new capital from MEVP and a mix of regional and international investors, the company plans to expand its products, team, and sector coverage while responding to rising demand for working capital. The next phase of growth will focus on using its technology-driven financing model to support businesses across increasingly diverse and capital-intensive industries.