How to Prepare a Financing File That Financiers in Saudi Arabia Will Accept

Many business owners start their financing journey with one question: “How much can I borrow?” The more precise question, from the financier’s side, is: “Can this business repay — and does its file prove it?” The financing file is how your business answers that question before it is even asked. The clearer and more complete the file, the faster the application is reviewed and the higher the chance of approval.

What does a financier actually look for?

Details differ from one financier to another, but most assess a business on four main areas:

• Repayment capacity: Are the business’s cash flows enough to cover the instalments with a safety margin?
• Credit history: How have the business and its owners handled their previous obligations?
• Clarity of purpose: Why do you need the financing, and how will it turn into revenue or savings?
• Collateral: What reduces the financier’s risk if repayment falters?

A good file answers these four questions with numbers and documents, not promises.

Core documents in a financing file

The final list is set by the financier according to the product, but a complete file usually includes:

• A valid commercial registration and, for companies, the articles of association.
• Financial statements for the last two or three years, preferably audited by an accredited audit firm.
• Bank statements covering a sufficient period, because they reflect actual cash movement.
• Zakat and tax certificates and evidence of the business’s regulatory compliance.
• Details of the owners and authorised signatories.
• Quotations or contracts showing how the financing will be used, such as buying equipment or executing a contract.
• A feasibility study or business plan when financing a new project or an expansion.
• Cash-flow projections for the coming period, showing how the instalments will be repaid.

A single missing document can send the application back to the start. That is why we prepare the complete file before submission, not after the financier asks.

The Kafalah programme: a guarantee that improves your chances

If your business is small or medium-sized and lacks sufficient collateral, the Kafalah programme (the SME financing guarantee programme) may be part of the solution. It is important to understand its role precisely:

• The programme does not provide financing directly; it issues a guarantee in favour of the financier that covers part of the risk.
• The business applies for financing to a financier that works with the programme, either directly or through the financing portal supervised by the SME Bank.
• If the financier considers an additional guarantee necessary, it refers the application to the programme for review.
• The programme requires the activity to be economically and financially viable, and its criteria include contributing to the employment and training of Saudi nationals.
• The programme works with banks and non-bank finance companies licensed by the Saudi Central Bank.

The programme classifies businesses by number of employees and revenue: micro (1 to 5 employees and revenue up to SAR 3 million), small (6 to 49 employees and revenue of SAR 3 to 40 million), and medium (50 to 249 employees and revenue of SAR 40 to 200 million).

An example of an actual bank’s requirements

To illustrate, one Saudi bank publishes its requirements for SME financing under the Kafalah programme, including:

• A valid commercial registration, and the owner’s ID or the articles of association.
• Balance sheets or financial statements, with audited balance sheets required for the last three years.
• Social insurance (GOSI), zakat and Saudisation certificates, the licence, the national address, and the VAT registration certificate.
• A positive credit record for the business and its owners with the Saudi Credit Bureau (SIMAH), and positive financial indicators.

These are one bank’s conditions, and details vary between financiers, but they give you a realistic picture of what is requested.

Credit history: what does the financier see?

The commercial credit report issued by SIMAH combines data from several financiers and public sources, and covers existing obligations and facilities, repayment behaviour, defaults and legal actions. Financiers use it in the approval or rejection decision and in setting the limits and terms of the offer. That is why it is useful to review your credit position before you apply, not after.

Steps to prepare the file

1. Define the need precisely

Don’t ask for “the largest amount possible”. Calculate the amount the purpose actually requires, and the type of financing that suits it: working-capital financing differs from asset financing or project financing.

2. Review your financial statements before the financier does

Read your statements the way a credit analyst will: Are profits stable? Are receivables inflated? Are existing liabilities high relative to equity? Addressing or explaining these points in advance is better than letting them surprise the financier.

3. Build realistic cash projections

The financier cares about your ability to repay month by month. Exaggerated projections weaken the analyst’s confidence in the whole file, while conservative projections backed by contracts or historical data strengthen it.

4. Choose the right financier and product

Banks and licensed finance companies differ in the sectors they prefer, their profit margins and the collateral they require. Choosing the financier that fits your activity saves time and raises the likelihood of approval.

Common mistakes that delay approval

• Submitting financial statements that are disorganised or inconsistent with bank statements.
• Not explaining the purpose of the financing and how it will be repaid.
• Applying to several financiers at once without a strategy, which multiplies credit enquiries.
• Ignoring remarks in the credit record without explaining or resolving them.
• Requesting an amount out of proportion to the size and cash flows of the business.

How CBF can help

We support you from assessing your financing readiness to preparing a complete file for licensed financiers: we define the need and the most suitable product, prepare the financial projections, review the documents, and follow up with you until a decision is issued.

Sources: Kafalah programme FAQ (kafalah.gov.sa); Kafalah financing requirements at the Saudi Investment Bank (saib.com.sa); Commercial credit reports — SIMAH (simah.com)

Before you apply, estimate your instalment: Financing calculator→