New loan guarantees boost SME financing in Oman

MUSCAT: The Development Bank has partnered with Sohar International to introduce a new loan guarantee programme designed to improve access to financing for Omani companies, particularly small and medium enterprises seeking expansion or new project development.
The initiative reflects ongoing national efforts to strengthen private-sector growth and support economic diversification by addressing financing gaps faced by promising businesses during key growth phases.
Through the programme, Sohar Islamic will provide Sharia-compliant financing to eligible companies, while the Development Bank will guarantee between 50 per cent and 80 per cent of the loan value, depending on project size, nature and economic feasibility. The risk-sharing structure is expected to encourage greater lending by reducing exposure for participating financial institutions.
Hussein bin Ali al Lawati, CEO of the Development Bank, said the programme will help Omani companies reach advanced stages of growth by widening access to funding and enabling more enterprises to invest, expand operations and generate employment opportunities. He noted that collaboration with partner banks strengthens the availability of diversified financing solutions across the Sultanate and enhances credit confidence within the market.
Abdul Wahid bin Mohammed al Murshidi, CEO of Sohar International, emphasised that sustainable SME growth requires not only liquidity but also strong risk-management frameworks and disciplined capital allocation. He said the partnership demonstrates the bank’s commitment to expanding Sharia-compliant financing supported by robust guarantee mechanisms that strengthen confidence in lending to SMEs and priority economic sectors.
The loan guarantee programme is designed as a scalable model that can be extended to additional banking partners in the future. By supporting companies moving from planning to implementation stages, the initiative is expected to stimulate investment, enhance local value creation, increase non-oil export potential and contribute to job creation, further reinforcing the resilience and competitiveness of Oman’s private sector. — ONA