Leading Saudi digital broker Arib has announced a capital raise of $2.3M, in a seed investment round led by Merak Capital, a tech investment firm licensed by Saudi’s Capital Markets Authority.
This investment enables Arib to meet the requirements set by the Saudi Arabian Monetary Authority (SAMA) to finalize the licensing process. It will also crucially help Arib expand its portfolio of services to encompass different types of loans such as personal loans, home loans and credit cards. Arib expects to further streamline its operations and infrastructure.
Financial development in the Middle East
Islam sharia law has long been opposed to interest, however, financial services in the middle east have been undergoing a century-long reform. Western models on banking regulations and the consequent legalization of interest have been highlights of a reform process going back to the 19th century.
While interest is not illegal in a country like Saudi Arabia, it remains unenforceable. There have been workarounds to this with institutions making payments appear as hire purchase agreements. Another workaround has been leasing, which is as well growing within the region.
Owing to the fair difficulty in navigating the middle eastern market that is presented by historical and cultural prejudices, the market is best left to smart and savvy locals. Arib has clearly developed a sustainable model that works within the middle eastern framework, owing to its recent successes.
A lending revolutionary in Saudi Arabia
Arib is a digital loan brokerage firm that was founded in 2019 by Waleed Talaat, Omar Alhammad, and Mohamed Dessouky, and is headquartered in Riyadh, Saudi Arabia. Its core product, Syaaraat, is an all-in-one platform that avails to consumers auto financing options from different banks and lending financial institutions.
The platform helps people choose the best auto financing options with reference to their credit profile, quickly and with ease. Arib’s platform is also beneficial to lenders as its clients approach them through matching, without advertising. Dealerships also expect the availability of credit to boost their sales, consequently benefitting.
Expanding Arib’s credit offering
The past 3 years have seen Arib grow fast, with the company serving more than 50,000 customers in all regions of the Saudi Kingdom. Syaaraat has helped add transparency, efficiency and convenience to the car financing process.
Leveraging its now gathered experience, data and platform, Arib intends on offering more loan products to customers in a bid to further digitize the issuing process of loans. Arib will as well seek new partnerships with regional financial institutions, build a talented team and expand its offerings in other markets.
“We at Merak have always been committed to investing in technologies that play a pivotal role in the region’s digital infrastructure. As such, we are proud to back Arib as it accelerates in digitizing hundreds of billions in loans across the Kingdom, and soon the region,” remarked Abdullah Altamami, Partner & CEO of Merak Capital.