Sahl Finance, a leading non-banking financial institution in Saudi Arabia, announced a significant strategic step: the renewal of a Sharia-compliant credit facility agreement with Emirates NBD, one of the region’s largest banking groups. The facility, valued at SAR 200 million, reflects the strong confidence the banking sector has in Sahl’s business model and its promising future.
Background and importance of the agreement in the context of Vision 2030
This renewal comes at a time when the Saudi financial sector is undergoing radical transformations and rapid growth, driven by the objectives of the Financial Sector Development Program within the Kingdom’s Vision 2030. The vision aims to diversify sources of income and enhance the role of the private sector, and non-banking financial companies like “Sahl” play a pivotal role in achieving these objectives by providing flexible and innovative financing solutions for individuals and companies, which contributes to increasing liquidity in the market and stimulating local demand, especially in vital sectors such as the automotive and consumer goods sectors.
Funding details and strategic objectives
According to a statement issued by the company and published on the Saudi Stock Exchange (Tadawul), the financing period extends for five years, providing the company with long-term financial stability to implement its plans. This facility is secured by a promissory note for the full value of the agreement, in addition to the assignment of receivables to the bank—standard procedures that guarantee the rights of both parties. The primary objective of this step is to enable Sahl Finance to expand its operations and increase its sales volume in the coming period by enhancing its ability to provide new financing to its clients, in line with its ambitious strategy and future plans for growth and acquiring a larger market share.
Expected impact on the market and consumers
This agreement is expected to have a multifaceted positive impact. Domestically, the increased financing capacity of Sahl will enhance competition in the consumer finance market, benefiting consumers by providing them with more financing options on competitive terms. It also supports the stability and growth of the retail market in general. Regionally, this collaboration between a leading Saudi company and a prominent Emirati bank underscores the depth of financial and economic integration among the GCC countries and reflects the attractiveness of the Saudi market for major regional investments and financial institutions. Injecting additional liquidity into the market will bolster economic activity and contribute to achieving the goals of sustainable growth for the Saudi economy.
