Saudi Fintech Lendo Secures US$690m JPMorgan Facility

Lendo, a Saudi Arabia-based Shariah-compliant debt crowdfunding platform that connects SME borrowers with retail and institutional investors, has secured a US$690m warehouse facility from JPMorgan to expand its SME financing operations.

The warehouse facility, a financial arrangement that provides revolving credit for lending operations, will be strategically deployed to increase Lendo's lending capacity, introduce new products and expand SME coverage across the Kingdom.

Market Development

The platform has facilitated SR2.5bn (US$670m) in SME financing through over 5,000 transactions since its inception. 

Its network encompasses 84,000 investors who have earned SR125m (US$33.3m) in returns through the platform's debt crowdfunding model, which provides an alternative to traditional banking channels.

Current SME financing in Saudi Arabia stands at SR250bn (US$66.6bn), up from SR100bn (US$26.6bn) in 2018. 

The Financial Sector Development Programme aims to address the SR500bn (US$133.3bn) funding gap in the market through initiatives supporting alternative lending platforms.

Investment Background

The facility builds on Lendo's previous fundraising success. The company has completed two investment rounds, including a US$28m Series B led by Sanabil Investments, a wholly owned subsidiary of Saudi Arabia's Public Investment Fund (PIF).

This latest facility is expected to contribute to job creation in the Kingdom, supporting domestic economic growth and employment objectives. 

Under Vision 2030, Saudi Arabia aims to increase SME lending from 4% of total bank loans to 20% by 2030.

“This landmark facility represents a transformative moment for Lendo and the Saudi FinTech ecosystem,” says Osama Alraee, CEO and Co-founder of Lendo. 

“The strong backing from global financial institutions such as JPMorgan validates our innovative approach to SME financing and positions us to expand our impact in the Saudi market significantly.”

The deal signals growing confidence in Saudi Arabia's fintech sector and its regulatory framework, particularly in supporting alternative financing platforms that maintain compliance with Shariah financing principles.

“We are pleased to collaborate with Lendo on this landmark transaction,” says George Deves, Co-Head of Northern European ABS at JPMorgan. 

“A strong and fast-growing SME sector is vital for the local economy, and this financing will help support the strategic initiative to boost SME lending in Saudi Arabia.”

Exploring Lendo

Since its launch, Saudi fintech Lendo has carved out a distinctive niche in the Kingdom's digital finance landscape. 

The Riyadh-based outfit runs a Shariah-compliant marketplace where businesses can secure funding against their outstanding invoices – a clever solution to the age-old problem of cash flow that plagues many SMEs.

At the helm are co-founders Osama Alraee and Mohamed Jawabri, who've built the platform into a meeting point for capital-hungry businesses and investors keen on alternative opportunities. 

Their timing couldn't be better, as Saudi Arabia pushes ahead with its Vision 2030 economic transformation programme.

What sets Lendo apart is its focus on proper vetting – they're not just another lending platform throwing money about. Each business gets a thorough once-over before joining the marketplace. 

With backing from heavyweight venture capital firms and a growing suite of products like SME banking services, Lendo is steadily reshaping how Saudi businesses access capital.

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