Amwal Capital Launches $150M Islamic Credit Fund to Boost Gulf SMEs

Editorial Team

Last updated 15-05-2025

3 min

Amwal Capital Partners launched a $150 million Islamic financing fund for Gulf startups and SMEs.

The fund aims to bridge a $250 billion credit gap with flexible, asset-backed financing options.

SMEs in GCC countries, like Saudi Arabia, face limited banking access, making new solutions essential.

Initial deals target the booming GCC tourism and agri-food trading sectors to ensure growth.

This fund could be the needed boost for Gulf entrepreneurship, underexplored by traditional lenders.

Amwal Capital Partners has launched a new private credit fund tailored specifically to Islamic finance, aimed at boosting funding channels for startups and small businesses across the Gulf region. Confirming its first close, the new fund—named the ACP Islamic Financing Fund—is worth around $150 million, and is set to meet a growing investor appetite for Sharia-compliant financial options while also addressing the persistent credit gaps faced by smaller firms.

Despite their growing importance in Gulf economies, particularly in Saudi Arabia and the UAE, small and medium-sized enterprises (SMEs) continue to struggle with limited access to traditional banking. Right now, SME loans make up less than 10% of overall lending in GCC countries, which pales in comparison to the 20% or more seen in developed markets. It's a struggle familiar to any regular readers of Arageek who have followed GCC market news for years.

This underservice has created a credit gap in the region estimated at around a whopping $250 billion. Amwal Capital's newest fund is specifically designed to navigate around traditional banking hurdles by offering flexible, asset-backed financing. The gameplan is ambitious but practical: targeting between twelve and fifteen deals over the next five years, mainly focusing on tech-backed platforms, logistics, fintech, vehicle leasing, and other sectors poised for growth.

Sharif Eid, a partner and co-head of fixed income at Amwal Capital Partners, described the current regional private credit environment as incredibly appealing, capable of providing returns close to equities while ensuring sound structure and substantial collateral. Meanwhile, co-founder and chief investment officer Fadi Arbid emphasised how this fund aims squarely at fixing what he calls the "chronic mismatch" between available financial resources and genuine economic needs—especially in the Sharia-compliant space, which, let's face it, traditional lenders have largely overlooked.

From what Amwal Capital Partners shared, the fund is already getting off to a brisk start—launching with two initial deals targeting the booming GCC tourism industry and the strategic agri-food trading sector. Additional asset-backed deals are expected throughout the year, bringing the planned total to four or so by year's end.

The fund's approach, with average maturities of about three to four years, seems carefully calibrated to deliver impactful, targeted financing to SMEs without being overly cautious. It's precisely this willingness to dive into more specialised sectors that's arguably been missing in the region.

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It's worth mentioning, if (like me) you follow Arageek regularly, you'll appreciate just how often the lack of tailored financing options comes up as an obstacle to Gulf entrepreneurship. Funds like ACP’s Islamic Financing Fund might just be the practical shot in the arm that's needed.

While nobody expects the situation to change completely overnight, it looks as though Amwal Capital is placing solid bets—leveraging opportunities often ignored by more tradtional lenders—to genuinely boost regional SMEs. Time will ultimately tell, but it's an encouraging sign in a market that's often stubbornly slow to adapt.

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