Riyadh’s erad raises $22 million to expand Shariah-compliant SME financing across the Gulf
The Series A, led by MEVP with a wide syndicate of new and existing backers, funds erad’s working-capital platform for small and midsize businesses in Saudi Arabia and the wider GCC.
Erad, a Riyadh-headquartered alternative financing platform, has raised $22 million in a Series A round to expand its Shariah-compliant working-capital products for small and midsize businesses across Saudi Arabia and the Gulf Cooperation Council.
The round was led by MEVP, the Middle East-focused venture firm, with participation from a broad syndicate of new investors including 500 Global, SVC, S60 Ventures, ANB Capital, Conjunction Capital and Araya Ventures. Existing backers Khwarizmi Ventures, Nuwa Capital, Aljazira Capital, Oraseya Capital and Joa Capital also returned for the round.
Erad positions itself as an alternative to conventional bank lending for SMEs, a segment that across the GCC has historically struggled to access working capital through traditional channels because of thin credit files, collateral requirements or the absence of interest-based financing options that comply with Islamic finance principles. The company structures its products to meet Shariah compliance standards while still delivering the kind of short-term liquidity SMEs use to bridge receivables, inventory purchases or payroll gaps.
The raise comes amid a broader wave of venture investment into Gulf fintech, as Saudi Arabia’s Vision 2030 economic diversification push and the UAE’s fintech licensing regimes have drawn increasing capital into SME lending, payments and digital banking infrastructure across the region. SME financing gaps remain a persistent theme in GCC economic policy discussions, with regional development banks and sovereign wealth-linked funds citing access to working capital as a constraint on private-sector job creation.
The company has not disclosed specific loan volume, default rate or portfolio size figures alongside the funding announcement. As with any early-stage lending platform, the round’s ultimate significance will depend on how erad’s underwriting performs at scale, a track record still in the process of being built.