The need to provide a guarantor is an obstacle facing small business financing programs applying for loans from the Saudi Credit Fund. According to Mohammed Al-Khalid, head of the Small and Middle Business Unit at the Makkah Technical and Vocational Training Council, Jeddah branch, many Saudis are applying for financial support to start their own business, but applications are rejected due to their inability to provide someone who can act as a guarantor in case the applicant is not able to pay back the loan money. “An applicant should go through a training course in which his project is assessed,” Al-Khalid told Saudi Gazette. He added that the applicant should be 21 years of age or older to be eligible for a loan. “We have received 203 applications, 157 of which are for totally new projects. The number was then reduced to 97 as some applicants were found to be already working,” Al-Khalid said. He revealed that 48 applicants' requests have been approved and given more than SR9.6 million in loans over the last four years. “The Saudi Credit Fund has allocated some SR20.34 million to help 13 new applicants. The loans thus granted have to be paid back to the Fund within ten years,” he said. The TVTC has recently graduated the fifth group of a leading program called “Start your Small Business.” “Thirteen prospective businessmen successfully ended their training program,” he said. According to Ali Al-Harithi, vice president of the Technical and Vocational Training Council, these 13 people have received a training course on how to manage small businesses. “These projects can surely add to the national economy and make many jobs available for Saudis,” Al Harithi said.
