QCB introduces POS-based financing rules for MSMEs

The Qatar Central Bank (QCB) has introduced new regulations to provide financing options for Micro, Small and Medium Enterprises (MSMEs) based on their point-of-sale (POS) revenues and verified electronic payment revenues in Qatar. This move aligns with the Third Financial Sector Strategy and aims to promote financial inclusion in the country.

According to a statement from the QCB, these regulations are designed to support MSMEs in expanding their business activities by simplifying the process of obtaining credit. The new rules reduce collateral requirements for credit approval and prioritize the MSME's revenues as a source for repayment, regardless of whether these revenues are generated through POS devices provided by the same financing bank or by other financial institutions.

The regulations also allow for the use of verified electronic payment revenue streams within Qatar that can be substantiated. Both POS revenues generated by the same financing bank and those from other banks can be utilized for this purpose.

To ensure responsible lending practices, the regulations set a maximum financing limit at 30% of the average total annual revenues of the MSME. The repayment period is limited to two years, with a grace period not exceeding six months. These additional controls are implemented to safeguard the interests of both the banks and the customers involved.