Saudi MSMEs get new three-month payment respite

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Saudi MSMEs affected by Covid-19 and a downturn in trade will now have to make payments to their financing entities only next year. AFP File Photo
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  • The respite is in the form of the extension of the Deferred Payment Program for the MSMEs
  • The initiative is one of the many Private Sector Financing Support Programs the central bank has launched to help the economy

The Saudi Central Bank has given a further three months’ respite to micro, small and medium enterprises, or MSMEs, according to an official statement.

This comes in the form of the extension of the Deferred Payment Program for the MSMEs, which is one of the many Private Sector Financing Support Programs the bank has launched to help the country’s economy.

The extension now defers payment to December 31 this year. This means MSMEs affected by Covid-19 precautionary measures and a downturn in trade would have to make payments to their financing entities only next year, if no further extensions are granted.

The Deferred Payment Program was launched on March 14 last year, as Covid-19 was spreading across the world.

According to the central bank, it benefited more than 107,000 contracts with a total value of SAR174 billion ($46.4 billion) in deferred payments.

Meanwhile, the number of contracts benefiting from the Guaranteed Financing Program has exceeded 6,000 contracts, with total financing value of more than SAR11 billion ($2.93 billion).

The purpose of these programs has been to support the private sector as well as financial system liquidity, which should help in easing the economic impact of the Covid-19 precautionary measures on the MSMEs sector.

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