YAKUB ABDULRASHEED – Saudi Arabia-based fintech company Erad has raised $22 million in a Series A funding round as it seeks to expand its technology-driven financing services for small and medium-sized enterprises (SMEs) across the Gulf Cooperation Council (GCC) region.
The round was led by Middle East Venture Partners (MEVP), with participation from new investors including 500 Global, Saudi Venture Capital (SVC), S60 Ventures, ANB Capital, Conjunction Capital and Araya Ventures, alongside existing backers such as Khwarizmi Ventures, Nuwa Capital, Aljazira Capital, Oraseya Capital and Joa Capital.
The Riyadh-headquartered company said the fresh capital will support the development of new financing products, regional expansion and strategic recruitment.
The funding comes as Erad reports eight-fold year-on-year growth in Saudi Arabia and more than SAR 500 million ($133 million) in cumulative financing deployed to SMEs since its launch.
What is Erad and What Does It Do?
Founded in 2022 by Salem Abu-Hammour, Faris Yaghmour, Abdulmalik Almeheini, and Youssef Said, Erad is an alternative financing platform designed to help SMEs access working capital more quickly.
Headquartered in Riyadh, the company provides Shariah-compliant financing of up to SAR 10 million to businesses operating in Saudi Arabia and the United Arab Emirates.
Its model combines financial data, technology and artificial intelligence to assess businesses and determine their financing needs and risk profiles.
According to the company, customers can receive financing approval in an average of 48 hours. The platform is designed for businesses that require capital for activities such as purchasing inventory, expanding fleets, opening new locations or fulfilling larger contracts.
“Our clients seek speed to capital and markets,” co-founder Salem Abu-Hammour said, adding that Erad aims to make financing “fast, fair, and frictionless.”
Erad’s Growing Demand for SME Financing
Erad’s latest funding comes against the backdrop of what the company describes as rapidly increasing demand for alternative business financing across the GCC.
The fintech said it has received more than SAR 4 billion, equivalent to about $1 billion, in financing requests from SMEs to date, while it has deployed more than SAR 500 million, or approximately $133 million, in cumulative financing.
The difference between requested and deployed financing highlights the scale of demand that remains unmet among businesses seeking working capital. Erad has also reported eight-fold year-on-year growth in Saudi Arabia, suggesting that demand for its financing model has expanded significantly.
The company says its customer base is also broadening beyond its original target sectors, with businesses in logistics, medical equipment and wholesale distribution increasingly using its platform to access capital for expansion and day-to-day operations.
How AI and Data Are Changing Erad’s Financing Model
A major part of Erad’s proposition is its use of proprietary technology and artificial intelligence to assess businesses and manage financing risks.
Instead of relying exclusively on traditional lending processes, the company analyses business data and cash flows to understand a customer’s financial position and determine its ability to take on additional financing.
Erad said its data-driven underwriting system enables it to process larger volumes and larger financing amounts while maintaining risk controls.
The technology also allows the company to monitor customer cash flows and identify additional financing requirements as businesses grow.
According to Erad, 85 per cent of its clients continue to grow with the platform, expanding their financing within their first year.
The approach is particularly relevant for SMEs that may require capital quickly to take advantage of contracts, increase inventory, expand operations or invest in productive assets.
Why the Funding is Important for Erad
The $22 million Series A investment gives Erad additional resources to move from rapid growth in its existing markets towards broader expansion across the GCC.
The company plans to use the funding to develop new financing products, expand its regional operations and increase hiring across its technology and commercial teams.
Erad also intends to focus more heavily on capital-intensive industries such as industrial operations, logistics and manufacturing, where businesses often require significant upfront capital to support expansion.
The company described the latest investment as an opportunity to deepen its product offering and reach businesses with financing requirements that existing products may not fully address.
“What excites me most is where we go from here, which is deeper into new sectors, into new products that did not exist before, and powering the businesses that are scaling across the region,” Abu-Hammour said.
The Bigger Opportunity in the GCC SME Market
Erad’s expansion strategy is closely connected to the economic importance of SMEs across the Gulf.
The company said SMEs account for approximately 50 per cent of regional GDP and employ about two-thirds of the GCC workforce, while continuing to face a significant financing gap.
MEVP Partner Jad El Boustani said the investment reflects the opportunity to address what he described as the region’s $250 billion SME financing gap.
He also pointed to Erad’s reported growth and its 48-hour approval process as evidence of the company’s ability to respond to businesses seeking faster access to capital.
Beyond Saudi Arabia and the UAE, Erad plans to strengthen its presence across the wider GCC as demand for alternative financing grows.
The company had previously secured a $125 million scalable financing facility led by Jefferies in November 2025, providing further capacity to support its lending activities.
What Comes Next for Erad?
With the Series A round completed, Erad is preparing for another phase of expansion centred on products, technology, sectors and geography.
The company plans to introduce financing solutions tailored to industries such as manufacturing, logistics and industrial operations while continuing to serve businesses in sectors including medical equipment and wholesale distribution.
Its strategy is to combine additional financing capacity with technology that can assess and monitor businesses at scale.
The company’s recent growth suggests that there is significant demand for financing alternatives among GCC SMEs, but its continued expansion will also depend on its ability to manage credit risk as financing volumes increase.
For Erad, the immediate ambition is therefore not simply to provide more money to more businesses, but to build a technology-driven financing platform capable of supporting SMEs as they move from smaller operations into larger, more capital-intensive enterprises across the region.
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