The Saudi General Authority for Small and Medium Enterprises (Monsha’at) has on Sunday released its SME Monitor Report for the second quarter of 2024.
According to the report, Saudi Arabia has seen a substantial growth in commercial records during Q2 2024, compared to the same period last year. The report also highlights the latest figures, case studies and initiatives related to small and medium enterprises, as well as commerce and FinTech sectors.
Monsha’at Commercial Registrations
Saudi Arabia’s private sector has shown great resilience in the face of global economic challenges, achieving significant growth in the second quarter of the year, says Monsha’at. In Q2 2024, the number of commercial registrations surged by 78%, compared to the same period last year, to reach 1.5 million commercial registrations across the Kingdom.
The new commercial registrations were driven by female entrepreneurs, with 45% of the new registrations going to female-owned businesses. This figure highlights Saudi Arabia’s efforts to empower women and increase their participation in the economy.
Furthermore, 38% of the new registrations by the end of Q2 2024 are for youth-owned businesses, indicating an uptick in Saudi youth participation in the economy.
Active Regions
The new commercial registrations were concentrated in certain regions, according to Monsha’at Monitor Report. The Riyadh Region recorded 482,690 registrations, accounting for 32% growth, while Makkah Region recorded 342,840 registrations, with 23% growth.
Meanwhile, the Eastern Province saw 15% increase, with 235,606 new registrations, and the other regions recorded 457,520 registrations, a 30% growth. The surge in commercial registrations in Q2 2024 represents a 4.3% increase compared to the first quarter of the same year.
FinTech Sector
The financial technology (FinTech) sector has seen a significant growth in Saudi Arabia. Since the launch of “FinTech Saudi” in 2018, the sector has boomed with the establishment of 216 FinTech companies, supported by $1.84bn in venture capital (VC) investments. This has further established the Kingdom’s position as a growing hub for FinTech innovation, according to Monsha’at.
Owing to the FinTech sector’s resilience and growth, Saudi Arabia’s first FinTech initial public offering (IPO), Rasan, has gained remarkable investor interest in May 2024. The growing investments in the Saudi thriving sector has raised the number of FinTech companies to 216 by the end of 2023, providing over 6,500 jobs for highly-skilled professionals in this promising sector.
To leverage the growing FinTech sector and advance Vision 2030 objectives, the Kingdom launched the National FinTech Strategy in 2022. The strategy aims to achieve an 80% cashless society, establish 525 FinTech companies, contribute $3.5bn to the GDP, and create 18,000 FinTech jobs by 2030.
Monsha’at Achievements
Monsha’at provides a wide range of services to small and medium enterprises, including upskilling, enablement, financing, business development, franchising, and expansion program. These services benefited more than 20,000 SMEs and entrepreneurs in Q2 2024.
According to Monsha’at Monitor Report, 12,401 SMEs benefited from Monsha’at’s SMEs Support Centers. Moreover, 8,241 trainees benefited from Monsha’at’s e-Academy. Meanwhile, 581 SMEs qualified for Monsha’at’s Jadeer service.
The report also notes that 692 beneficiaries benefited from Mazaya Platform, and 500 beneficiaries benefited from Innovation Centers. Furthermore, 86 brands listed on the Franchise Center platform, 135 SMEs joined Tomoh program, and 3 SMEs offered in parallel Nomu market through the Tomoh program.
Venture Capital Funding
During the first half of 2024, Saudi Arabia led the MENA region in funding, with $412mn going to Saudi-based startups, accounting for 54% of all funding in the region during the same period. In addition, international participation has surged to nearly 30% of all MENA investments in Saudi-based startups.
The Monsha’at Monitor Report notes that H1 2024 also recorded 63 new deals. The e-commerce platform Salla recorded $130mn in pre-IPO investments. Moreover, 72 entities backed Saudi-based startups, with 28% of investors being international.
