Kafalat

What Kafalat does

Kafalat S.A.L. is a Lebanese financial joint-stock company founded in 2000 that operates as a government-backed loan guarantee institution, not a direct lender. The company guarantees bank loans issued by any commercial bank operating in Lebanon to small and medium enterprises (SMEs) with fewer than 40 employees, covering 75% to 90% of the loan value depending on the program. Its guarantee programs are organized around five subsidized sectors: Industry, Agriculture, Tourism, High Technology, and Traditional Crafts. The institution is 75% owned by the National Deposit Guarantee Institution (a Lebanese government entity) and 25% collectively owned by 50 Lebanese banks, with the Central Bank of Lebanon (BDL) administering a 4.5% interest subsidy on guaranteed loans for up to 7 years.

Kafalat's product portfolio includes Kafalat Basic (the foundational program, active since 2000), Kafalat Agriculture, and Kafalat Energy (with three sub-programs covering energy efficiency and renewable energy). Several programs — Kafalat Plus, Kafalat Innovative, and Kafalat Start-ups and Innovation — are currently listed as suspended. Two externally funded programs broaden the mandate: Kafalat iSME, a USD 30 million World Bank/Government of Lebanon initiative to encourage equity investment in innovative firms, and the B5 Fund, a USD 25 million Lebanon Financing Facility grant program supporting micro and small enterprises damaged by the 2020 Beirut port explosion. The institution additionally serves as the executing agency for SME lending under Component 1.2 of the CDR-implemented GATE (Green Agri-Food Transformation for Economic Recovery) project.

The revenue model is transaction-based: Kafalat charges a 2.5% annual commission on the outstanding guarantee value, plus a one-time 0.4% fiscal stamp on the guarantee value at issuance. Distribution is exclusively indirect — borrowers must first obtain bank approval, after which the bank submits the application to Kafalat for an independent guarantee decision. The institution operates with 11-50 employees from a single headquarters in Beirut and has 2,340 active guaranteed loans across the Industry, Agriculture, and Tourism sectors as of 31 December 2022.

Name

Kafalat

Legal name

Kafalat S.A.L.

Website

https://kafalat.com.lb

Company type

Private

Founded year

2000

Operating status

Operating

Headcount range

11–50 employees

Short description

Kafalat is a Lebanese government-backed loan guarantee institution that enables SMEs in five subsidized sectors to access bank financing by guaranteeing 75-90% of loan value, distributing exclusively through all commercial banks in Lebanon.

Ownership category

akta.pro rank

Product category

Loan Guarantee Services

NAICS

Mortgage and Nonmortgage Loan Brokers (52231)

SIC

Miscellaneous Business Credit Institution (6159)

akta.pro primary industry

SBA/Government-Backed & Development Finance Loans (FSAKAGAI)

akta.pro secondary industry

Development Finance, Guarantees & Blended Finance Programs (BPADABAM)

Keywords

• Loan guarantee services
• SME credit guarantees
• Small business financing
• Government-backed guarantees
• Guarantee programs

Headquarters

HQ city

Beirut

HQ country

Lebanon

HQ region

Middle East

Offices1 record

Markets served

GTM type

B2B

Offering type

Services

Cost components

Personnel, Operations, Technology or R&D, Marketing or Sales, Infrastructure

Revenue model

1. Loan Guarantee Fees: Kafalat earns a 2.5% yearly commission on the outstanding value of the guarantee. The guarantee covers 75% or 85% of the loan value approved by the bank and Kafalat. Additionally, fiscal stamps at 0.4% of the guarantee value are charged once at Letter of Guarantee issuance. Kafalat does NOT grant loans directly; it guarantees loans given by banks operating in Lebanon.

Pricing tiers

Go-to-market motion1 record

Distribution channels1 record

Marketing channels4 records

Core offering

Kafalat S.A.L. is a Lebanese financial joint-stock company that provides government-backed loan guarantees to small and medium enterprises (SMEs) operating in five subsidized sectors: Industry, Agriculture, Tourism, High Technology, and Traditional Crafts. Kafalat does not grant loans directly; instead, it guarantees 75% to 90% of loans issued by banks operating in Lebanon, and earns a 2.5% yearly commission on the outstanding value of each guarantee, in addition to fiscal stamps charged at 0.4% of the guarantee value.

Product overview

Kafalat is a Lebanese financial joint-stock company that provides loan guarantee programs for small and medium enterprises (SMEs) operating in Lebanon. The company operates several guarantee programs across five subsidized sectors: Industry, Agriculture, Tourism, High Technology, and Traditional Crafts. The product portfolio includes Kafalat Basic (foundational program since 2000), Kafalat Plus (enhanced support for existing SMEs), Kafalat Innovative (for innovative startups), Kafalat Start-ups and Innovation (for early-stage companies), Kafalat Agriculture (for farming and tree cultivation), Kafalat Energy (for energy efficiency and renewable energy), and Kafalat iSME (World Bank-funded equity investment program). Additionally, the B5 Fund provides grants to businesses affected by the Beirut port explosion. Kafalat works with all operating banks in Lebanon and does not grant loans directly.

Differentiator

Problem solved

Functional benefit

Products and services

• Kafalat Basic Foundational loan guarantee program providing guarantees for investment in fixed assets and working capital for SMEs in five subsidized sectors (Industry, Agriculture, Tourism, High Technology, Traditional Crafts). Maximum loan: 300 million LBP; guarantee: 75%; term up to 7 years; grace period up to 1 year.
• Kafalat Plus Enhanced loan guarantee program (currently suspended) developed in partnership with the European Union and Ministry of Economy and Trade, supporting existing SMEs and startups with higher loan amounts (up to 600 million LBP) and guarantee ratios (85%).
• Kafalat Innovative Loan guarantee program (currently suspended) created in partnership with the European Union and Lebanon's Ministry of Economy, supporting innovative startups in high technology and innovation sectors with up to 300 million LBP loans and 90% guarantee coverage.
• Kafalat Start-ups and Innovation Loan guarantee program (currently suspended) developed through a partnership between the European Union and the Council of Ministers, providing financing support for innovative SMEs and startups with up to 650 million LBP loans and 85% (regular startups) or 90% (innovative startups) guarantee coverage.
• Kafalat Agriculture Loan guarantee program under the Agricultural and Rural Development Programme (ARDP), co-funded by the European Union, supporting small farmers and tree cultivation with specialized loan terms, including up to 65 million LBP for small farmers (85% guarantee) and up to 480 million LBP for tree cultivation (75% guarantee, up to 10 years).
• Kafalat Energy Loan guarantee program developed through an EU-Lebanon partnership to address energy constraints faced by SMEs, supporting investments in energy efficiency and renewable energy projects. Includes three sub-programs covering energy efficiency (up to 600 million LBP, 2% fee), renewable energy for self-use (up to 600 million LBP, up to 15 years), and renewable energy for sale (up to 750 million LBP, up to 15 years).
• Kafalat iSME USD 30 million initiative funded by the Government of Lebanon and the World Bank, designed to encourage equity investment market development and increase early-stage investment finance for new and existing innovative firms in Lebanon.
• B5 Fund (Beirut Business Recovery Grant) USD 25 million grant program funded by the Lebanon Financing Facility (World Bank), providing grants of up to USD 25,000 to micro and small enterprises damaged by the Beirut port explosion to support business recovery and preserve jobs. Disbursed through Kafalat (up to USD 25,000) and through microfinance institutions (up to USD 10,000).

Quantifiable outcome

• Interest subsidy of 4.5% on subsidized loans for up to 7 years
• +3 more outcomes

Segments8 records

Ideal customer profiles3 records

Technology focussed No

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Partnerships

Ten partnerships are on record, tiered minor and core.

• Industrial Research Institute (IRI)minorStrategic or Co-development PartnerListed as Partner in Cooperation, providing technical expertise and support for SME development initiatives.
• Multilateral Investment Guarantee Agency (MIGA)minorStrategic or Co-development PartnerListed as Partner in Cooperation, supporting investment guarantee and SME financing initiatives.
• Lebanese Banks (Association)coreChannel Partner/ Reseller/ DistributorAll banks operating in Lebanon serve as the exclusive distribution channel for Kafalat guarantees. Banks evaluate loan applications and, if approved, submit them to Kafalat for guarantee issuance.
• Ministry of Agriculture LebanonminorStrategic or Co-development PartnerPartner in implementing the Agricultural and Rural Development Programme (ARDP) within which Kafalat Agriculture operates.
• Ministry of Economy and Trade LebanonminorStrategic or Co-development PartnerPartnership with EU for Kafalat Plus and Kafalat Innovative programs to support SME development.
• Bader (Bader Lebanon)minorOthersListed as Related Party of Interest on Kafalat website.
• Investment Development Authority of Lebanon (IDAL)minorOthersListed as Related Party of Interest, supporting investment and business development in Lebanon.
• Entrepreneurs LebanonminorOthersListed as Related Party of Interest, supporting entrepreneurship in Lebanon.
• Lebanese Armed ForcesminorOthersProvided the zoning assessment for areas damaged by the Beirut port explosion, used to prioritize B5 Fund grant recipients based on proximity to the blast site.
• Lebanese Banks (individual)coreChannel Partner/ Reseller/ DistributorIndividual banks including Banque Libano-Française (BLF) serve as specific distribution points for B5 Fund grants, with BLF branches serving as disbursement locations for approved grants.

Scale indicators9 records

Recent moves6 records

Expansion highlights5 records

Broad incumbents

• bpifrance: French public investment bank that provides loan guarantees and SME financing through partner banks. Kafalat plays an analogous role at smaller scale in Lebanon, with similar bank-intermediated guarantee products and government backing.
• KfW (Kreditanstalt für Wiederaufbau): German state development bank that funds SME guarantee schemes globally, including in MENA. Kafalat partners with similar multilateral and bilateral funders (EU, World Bank) for program funding.
• British Business Bank: UK government-backed economic development bank that operates loan guarantee schemes through partner banks. Kafalat's structure closely parallels its state-backed guarantee intermediation mandate for SME access to finance.
• U.S. Small Business Administration (SBA): U.S. federal agency providing government-backed loan guarantees for SMEs through partner lenders. Kafalat's model mirrors SBA's partial-credit guarantee structure across multiple program verticals in a single jurisdiction.

Direct peers

• Mutual Guarantee Institutions (SOFINA / SIAGI type): European mutual guarantee societies providing SME loan guarantees through partner banks in defined sectors. Kafalat's sector-tied guarantee products (agriculture, tourism, industry) are structurally comparable to these mutual guarantee models.
• Compagnie de Garantie des Crédits aux Entreprises (CGCME): French mutual guarantee institution specializing in SME credit guarantees through partner banks. Kafalat operates with a virtually identical guarantee-intermediation model for SME lending in a defined sector set.
• Jordan Loan Guarantee Corporation (JLGC): Jordanian government-backed SME credit guarantee corporation with similar partial-credit guarantee products. Operates as the closest direct regional peer to Kafalat in the MENA guarantee-institution ecosystem.
• Egyptian Credit Guarantee Company (ECGC): Egyptian state-backed credit guarantee company facilitating SME access to bank financing. Direct MENA peer with overlapping guarantee products and bank-intermediated distribution model.

Others

• World Bank Group / International Finance Corporation: Multilateral development institutions that fund and partner with Kafalat through the iSME programme and B5 Fund. Comparable as ecosystem enablers in the same SME guarantee space rather than direct competitors.

Regional players

• Saudi Industrial Development Fund (SIDF): Saudi government fund providing development financing and guarantees for industrial SMEs in Saudi Arabia. Kafalat's industry-sector guarantee vertical (1,327 active loans) is comparable in mandate and sector focus.

Market position

Strengths5 records

Weaknesses5 records

Competitive moat3 records

Key risks6 records

Key highlights7 records

Customer concentration

• LinkedInlinkedin.com/company/kafalat-s-a-l-

Revenue estimate

Valuation estimate

Number of profiles

Profiles7 records

Funding overview

Funding rounds

Investors

Funding detail is available on the Subscription and Enterprise plan.Contact sales →

M&A

Investments1 record

M&A and investment is available on the Subscription and Enterprise plan.Contact sales →

Frequently asked questions about Kafalat