erad, a Riyadh fintech providing Shariah-compliant working capital to small and mid-sized companies, has raised $22M in Series A funding led by Middle East Venture Partners.
500 Global, Saudi Venture Capital Company, S60 Ventures, ANB Capital, Conjunction Capital and Araya Ventures joined as new investors, with Khwarizmi Ventures, Nuwa Capital, Aljazira Capital, Oraseya Capital and Joa Capital returning.
Founded in 2022, erad lends against specific needs such as inventory, vehicles, new locations and contracts, with facilities reaching SAR10M, about $2.7M. Automated underwriting on business data lets it approve applicants in as little as 48 hours.
Credit history as the real asset
The gap is familiar across emerging markets: companies that are growing but lack the collateral, credit record or banking relationships a conventional loan demands. erad says it has delivered more than SAR500M, roughly $133M, in financing, fielded over SAR4B in requests and grown eightfold year on year in Saudi Arabia, while pushing into the United Arab Emirates.
Fintech lenders need two kinds of capital, equity to build the business and lending capital to fund customers, so the underwriting data accumulating on the loan book could end up more valuable than the software layer above it.
