Authors : Anas Hasan Albukaai, Moustafa El Abdallah Al-Kafry and Muhammad Tawfiq Ramadan Albuti
Abstract: This research studies the contribution of Islamic banks that work in The Kingdom of Saudi Arabia (KSA) in financing SMEs by speculative formula and the issues that prevent the arrival of this funding to those facilities. The most important findings of the research: Islamic banks in KSA do not provide funding for SMEs by speculative formula. Islamic banks in KSA in general tend towards short-term finance by sales formulas. Islamic banks also face difficulties limit its contribution to the financing of SMEs, the most important is the inflexibility banking system. The research finds several proposals including: adopt a national standard definition of SMEs. Accelerate in establishing the SMEs Development Commission and Islamic Loan Guarantee Foundation that contributes to the advancement of the business environment of SMEs which by consequence contributes in promoting and supporting its role in the national economy.
Anas Hasan Albukaai, Moustafa El Abdallah Al-Kafry and Muhammad Tawfiq Ramadan Albuti, 2017. Financing of SMEs by Speculative Formula (Mudharabah): Empirical Study on Islamic Banks at the Kingdom of Saudi Arabia. International Business Management, 11: 1429-1436.