If a business can have a full order book and still struggle to finance the next delivery, the lender needs confidence the money will come back. But can better information get more capital moving through that chain? Joining us at Money 20/20 Riyadh is Majed Abu Al Faraj, Co-Founder of Feesable, which builds software for lenders and the institutions behind them. Majed, thank you for joining us.
Thank you for having me. Pleasure to be here.
From the conversations you have been having on the floor, what stands out to you about where Saudi Arabia's financial sector is actually heading today?
Despite the ongoing geopolitical landscape in the region, Saudi Arabia is still championing ahead at the forefront of financial technology and innovation. You see that today with the number of local fintechs being represented, as well as international and regional players. You also have some of the largest financial institutions here as well as regulators. What is also great to see is that the investment landscape is starting to pick up. There have been a couple of months of uncertainty in terms of allocating capital towards emerging technologies — but we have seen a lot of that pick up now, and there is a degree of confidence, with some conservatism as well.
What kept going wrong between businesses needing money and lenders being willing to provide it — and what made you want to tackle it yourself?
Feesable is a digital platform. We are building the operating system for private credit and asset-backed finance. We sit at the middle layer between the fintech originator, lender, or asset manager on one side, and borrowers on the other. The main problem I noticed was the fragmentation of information and how manual a lot of processes are. Financial institutions require borrowers to send them information collated on a piecemeal basis. You have credit bureau engagement, internal stakeholder assessments, data rooms — all separate. What we wanted to do was bring all of that together in a unified platform, and add real-time data analytics for transparency on credit spreads and pricing on these loans. There is no platform doing this today.
Saudi SME financing reached roughly 468 billion riyals at the end of last year, with banks accounting for more than 95%. Where can alternative lenders actually win business banks are not serving?
According to a McKinsey study, by 2030 the Saudi lending market will be a $1.4 trillion market — approximately 5.6 trillion Saudi riyals — segmented across corporate, SME, mortgage, and consumer finance. Digital online lending is projected to represent 4% of that by 2030, which translates to approximately a $56 billion opportunity. Where we see the opportunities for alternative lenders — private credit funds, venture debt — is not competing with large financial institutions on traditional business credit risk, but rather approaching it as deal-specific transactions. Over the last 12 to 18 months, $5 billion worth of private credit deals has largely gone to major fintech originators. That is where alternative players are going to continue to play.
Take a distributor with a customer who pays in 90 days but a supplier who needs paying now. Where does Feesable come in and who takes the lending risk?
We sit in the middle layer — we are not an underwriter of loans or financing. What we want to do is empower fintech originators and lenders, whether that is a private credit fund or later a financial institution. What we do is allow those loan datasets that a lender would get from a borrower to feed through our platform, helping with asset verification, real-time analytics, and transparency. Right now that is a very manual Excel process — there is no platform that consolidates that data. Our wedge is on the private credit side, with asset managers and fintech originators, connecting them with borrowers. And that later builds towards our second business, which is related to the embedded finance thesis.
If a business has years of invoices and payment records sitting in its software, what would you need to see to help a lender say yes when a conventional application might get a no?
Data transparency and analytics — and that will gradually grow over time in this part of the world, particularly in Saudi. We are not playing on the consumer side — we are looking at the B2B side. The information we require is those loan datasets and data types. Without that it becomes really difficult to help with credit decision-making. Ultimately what we are trying to do is reduce the cost of financing and the cost of debt. That is where covenants come in — interest rate coverage covenants, negative covenants, constraining covenants. A whole host of things that we need to aggregate.
What do you hope to see when you come back to Money 20/20 next year?
Hopefully you will have seen us onboard a whole host of clients, build our gradual AUM, and have future growth in this market. You will have seen a well-funded venture.
We hope so too. Thank you very much for joining us.
Such a pleasure. Appreciate it.
