G A U G I N G T H E M A R K E T
G A U G I N G T H E M A R K E T
DIGITAL LENDING OFFERS GCC BANKS EFFECTIVE INROADS INTO THE VITAL SME SEGMENT
Sara Hoteit , Regional Manager , Middle East at Backbase
Sara Hoteit , Regional Manager , Middle East at Backbase , explores how digital lending empowers GCC banks to capture the SME market by offering personalised , efficient financial solutions , driving growth and fostering long-term relationships . he contribution of SMEs to nonpetrochemical GDP in GCC nations
T varies . In the United Arab Emirates
( UAE ), it hovers around 60 %; in Saudi Arabia it is around 30 %; in Qatar it is 16 %. And SME contribution to employment tends to be even greater . All these nations have their eyes on similar horizons – sustainable economic growth , knowledge-based societies , globally competitive industries – and they know that smaller businesses have a pivotal role in achieving these ambitions .
It follows that banks can do much to support these up-and-comers . However , long-term , meaningful relationships with successful SMEs requires matching their agility . Younger entrepreneurs are invariably digital natives who expect personalised solutions . Having done their research , they will likely know that businesses of their size are notoriously underbanked , so an institution that is willing to step up and help them secure their cashflow will quickly earn their favour and , over the long term , their trust and loyalty .
The rise of digital lending
None of these SME ventures are risk-free . Loans may underperform and there are always other lenders with which to compete , including BNPL start-ups , micro-financiers , incubators , VCs and peer-to-peer lending schemes . But over the long term , guided by due-diligence practices , GCC banks can become an integral cog in the engine of business growth , advising www . intelligentfin . tech
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