Dubai-headquartered credit risk company Qarar and US lending platform Biz2X have formed a joint venture to address the financing issues faced by small and medium enterprises (SMEs) in Saudi Arabia.

The partnership, announced on Tuesday, aims to establish the largest SME lending platform in the kingdom. It is in line with Saudi Arabia’s goal to expand the GDP contribution of the SME sector from 9% to 22%.

SMEs have had issues with financing, as banks are reluctant to extend loans to SMEs at scale. Historically, up to 57% of financing requests from SMEs were declined by commercial banks.

With the platform, borrowers will be able to connect with lenders and “transact seamlessly”, according to a statement.

“The new platform will transform the SME lending process to fix this financing gap.”

Qarar is a wholly owned subsidiary of SIMAH. Biz2X also has presence in India and Australia and processed more than $10 billion in financing through its digital lending platform.

“By bringing our technology and expertise to lenders in Saudi Arabia, we are fulfilling our mission to make SME lending more accessible and efficient for businesses everywhere, fostering economic growth and prosperity,“ said Rohit Arora, CEO of Biz2X.

 (Writing by Cleofe Maceda; editing by Seban Scaria)