The Saudi Central Bank (SAMA) has extended the deferred payment program it launched for micro, small and medium enterprises (MSME) by another three months.
Last year, SAMA introduced stimulus measures to mitigate the impact of the COVID-19 crisis on the private sector and small businesses by allowing late repayments on loans.
The Deferred Payment Program, which was established in March last year, has been extended until December 31, 2021, according to SAMA’s statement. The scheme was previously extended in June for three months until September 30.
“The program has been extended for the benefit of micro, small and medium enterprises (MSME) that continue to be affected by the COVID-19 precautionary measures”, SAMA said. The current extension of the relief program is following the assessment of the financing entities.
Since its launch in March 2020, the program has been applied to more than 100,000 contracts with a total value of deferred payments worth $46.4 billion.
“The purpose of these programs has been to support the private sector as well as financial system liquidity, which should help in easing the economic impact of the COVID-19 precautionary measures on the MSMEs sector,” SAMA stated.
Since the outbreak of the pandemic last year, SAMA has taken a number of measures to stabilize Saudi Arabia’s economy which includes cutting interest rates and implementing a $13.3 billion stimulus package.
Saudi Arabia’s quick response to counter the COVID-19 has reduced its impact on the kingdom’s economy, which is expected to expand 2.1 percent this year. The pace of recovery will increase next year, as the largest Arab economy will grow 4.8 percent in 2022, after contracting 4.1 percent in 2020, according to the International Monetary Fund (IMF).
