Saudi men shop at the Mecca market in central Riyadh, Saudi Arabia. AFP Photo/Fayez Nureldine
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Hasan al-Hazmi knew he couldn't depend on Saudi Arabian lenders when opening his business last year even with the kingdom's drive to boost credit to small- and medium-sized companies.Lending under the nation's SME Loan Guarantee Program, also known as Kafalah, plunged 76 percent to 572 million riyals ($153 million) last year as banks tightened rules, according to data from the Saudi Industrial Development Fund. That compares with a 12 percent increase for total bank credit last year to 1.25 trillion riyals, according to Saudi central bank data. Small- and mid-sized enterprises' contribution to Saudi Arabia's gross domestic product was 33 percent last year compared with 64 percent in Japan, 57 percent in Spain and 50 percent in the U.S., data from World Bank's International Finance Corp.Saudi British Bank and Banque Saudi Fransi approved only two loans each.
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