Filling the SME Financing Gap in MENA

In this edition of Founder's Hustle, we explore one of MENA's most persistent business challenges: SME financing. We sat down with Shahrukh Ghazali, co-founder and CEO of Aura Finance, who's transforming how small businesses access capital, turning weeks-long bank ordeals into minutes-long digital experiences.

Shahrukh's Journey into Fintech

Born and raised in Karachi, Shahrukh got his first taste of entrepreneurship while studying at UC Berkeley where he tested a summer startup in online groceries for Pakistan. The idea didn’t stick, e-commerce in Pakistan was still premature in 2011, but the seed was planted.

After a stint at Symantec in San Francisco, a missed H-1B visa drew him back to Pakistan, where he joined Daraz, an e-commerce company backed by Rocket Internet. He later moved to Dubai to join Careem, where his career began to take shape. Starting on the early-stage markets team, Shahrukh helped launch operations in overlooked cities like Tanta and Gujranwala, and eventually led the full rollout in Marrakesh. Later, he played a key role in launching Careem’s food delivery vertical and later returned to lead growth and marketing at Careem Pay.

That’s where he met his future co-founder, Samer El Mardini, then director of strategy at Careem Pay. “He knew things I didn’t, and I respected how he worked,” Shahrukh recalls. Samer came from a background in financial services consulting and brought deep fintech expertise to the table. Their skillsets complemented each other, and both saw the same opportunity: solving SME financing in the region.

“We realized we liked working together,” Shahrukh says. “The timing, the team, the conviction—it all aligned.”

The SME Financing Gap

Small and mid-sized enterprises (SMEs) form the backbone of the GCC economy. Yet their growth is held back by a persistent challenge: limited access to capital, with the region facing a credit gap of close to $250 billion according to the World Bank.

Even when SMEs secure large contracts from reputable buyers, payment terms of 90 to 120 days can create crippling cash flow gaps. “They couldn’t make more sales, not due to a lack of demand, but because they didn’t have the funds to fulfill new orders,” Shahrukh explains.

The funding gap persists because traditional lenders often find SME lending economically unviable. “Banks, for example, have rigid minimum revenue requirements, which exclude a large portion of SMEs,” Shahrukh explains. SMEs are seen as high-risk and frequently lack audited financial documentation banks require. 

But the real bottleneck lies in the lending process itself: it’s manual, time-consuming, and full of back-and-forth. Multiple layers of human intervention, from credit officers to compliance teams, drive up the cost of assessing and underwriting each loan. For small ticket sizes, the effort simply doesn’t justify the return.

Aura was built to bridge the gap between a massive market need and the outdated models of traditional lenders, starting with businesses just below the typical banking cutoff, estimated at around AED 20 million in annual revenue.

Betting on Tech DNA

Shahrukh knew SME financing wasn’t a novel idea; banks had been trying and failing to crack it for years. So why would a startup succeed where financial giants hadn’t? “Part of it was naivety,” he admits. “You think it’s easier than it is. But I’m glad we took the leap.”

Beyond that, Shahrukh had a clear hypothesis: banks simply aren’t built to serve SMEs at scale. “Every company has a certain DNA,” he explains. “Banks are great at managing capital, risk, compliance, and scale. But tech? That’s not in their DNA.”

Aura leaned into that very gap, using smart technology to drive down costs and make serving smaller businesses viable. “If your tech stack is efficient enough, you can make the unit economics work—even for the long tail of SMEs,” he says. “We’re not profitable on an aggregate level yet, but at a unit level—yes, we are. And that’s because it’s a very low-touch experience.”

By minimizing human intervention through automation and a seamless UX, and by leveraging alternative data like bank statements,  Aura drastically reduces the cost to serve—making it profitable to support even the smallest clients. 

For Shahrukh, one sign of success is simple: “I’ve never had to give a demo to an SME.” The platform is so intuitive and self-serve that SMEs can get started without any handholding—and receive a response and financing within a day or two, unlike banks, where approval can take weeks or even months, and that’s assuming the bank even agrees to lend.

How it works

SMEs onboard onto Aura’s platform by providing their bank statements, along with company and personal documents, before uploading the B2B invoice they want to get paid for.

“One of the first things we focused on was reducing back-and-forth,” Shahrukh explains. That’s why the system checks all documents in real time and immediately flags anything missing.

Once the documents are submitted, Aura’s automated underwriting engine kicks in, delivering a credit decision in under five seconds, currently followed by a manual review. As the need for manual intervention is reduced or eliminated, SMEs will be able to receive decisions almost instantly. That same process could take a traditional bank up to six weeks.

The result? SMEs get funded as soon as an invoice is approved, giving them quick access to cash without having to wait for their buyers to pay. Once the agreed payment term is over, the SME settles the amount with Aura. Next up for Shahrukh and the team: automating the repayment process to make collections seamless too.

Credit Decisions

The real challenge was building the infrastructure to serve their customers, especially when it came to credit decisions. How do you assess risk and lend confidently to SMEs?

“We knew we had to get this right,” says Shahrukh. “So the first thing we did was hire someone with 20 years of credit experience.” Together, they built an expert scorecard and tested it on real data, laying the foundation for Aura’s risk engine.

From there, Aura refined its model across two key layers:

1. The Seller (SME): Aura reviews the company and owner’s profiles, as well as bank statements, to assess the SME’s creditworthiness. This is the starting point.

2. The Buyer (SME’s client): Since the SME’s ability to repay depends on their clients, Aura also checks who the buyers are. This includes analyzing their payment history by cross-referencing past invoices and bank statements. That’s why, today,  Aura only underwrites invoices from trusted blue-chip clients based in the UAE.

This model gives Aura confidence. However, not every SME invoice is eligible. Aura applies strict guardrails: it doesn’t support new buyers, meaning if an SME hasn’t previously sold to a particular buyer, that invoice won’t be financed. International buyers are also excluded. “There’s not enough recourse if something goes wrong—and there’s already plenty of local demand,” says Shahrukh.

Over time, a network effect is emerging. “As we keep the corporate buyer pool small, we start seeing the same names come up. That shared history de-risks those buyers for everyone.” In other words, the more often Aura sees a buyer pay on time, the more confidence it builds across the platform, making it faster and safer to underwrite future invoices tied to that buyer.

Managing Debt Capital 

When building a fintech that finances SMEs, having capital on hand is non-negotiable. But managing that capital, while balancing lender expectations and borrower realities, is where things get tricky.

For now, Aura relies primarily on external sources to fund its lending—raising debt from institutional partners or securing credit facilities from angel investors. To date, they’ve raised over $1 million in debt financing. In both cases, Aura pays a cost to access this capital, which it then lends out to its SME customers.

Each lender comes with different terms,and to build trust, Aura shares detailed portfolio analytics, approval logic, performance data, delays, and defaults.

Until recently, Aura tracked credit facility allocations manually in spreadsheets. But with multiple lenders and varying terms, repayment schedules, interest rates, restrictions, it became unscalable. A new internal platform is now being rolled out to give Aura better control and visibility over its different credit facilities.

Would a single large credit facility simplify things? Not necessarily. “Some lenders only finance repeat customers or specific types of transactions,” Shahrukh explains. Even large facilities can be too rigid, making it necessary to juggle multiple smaller ones.

“The challenge,” he says, “is making all these credit facilities work together without overpaying—meaning having too much credit you’re paying interest on but can’t lend out.” Striking that balance between having enough liquidity and not sitting on idle, costly capital is crucial. “It’s a balancing act,” Shahrukh adds, “and one of the most interesting parts of the business.”

Strategic Partnerships to Power Growth

“One of the biggest things I’ve learned is how much of fintech is actually about partnerships and collaboration,” Shahrukh notes. Aura’s growth strategy reflects that belief. The company has built a network of partners, each bringing unique strengths that help expand access to SME financing.

One key partnership is with Gainz, a regional crowdfunding platform that serves as a major debt provider. “We both have the same mission,” Shahrukh explains. Gainz secures the capital, while Aura focuses on deploying it efficiently. 

On the infrastructure side, Aura teamed up with Wafeq, one of the region’s most widely used accounting platforms. This integration allows SMBs to import invoices directly into Aura’s system, eliminating the need for double entry and streamlining the financing process. For now, Aura is featured on Wafeq’s integrations page, but the long-term goal is for an SME to generate an invoice in Wafeq and instantly see an option to finance it.

To generate demand, Aura also partnered with Sharjah Publishing City and Sharjah Media City, two key hubs supporting local startups and SMEs. Through these partnerships, Aura is positioned as a preferred financing partner—either embedded within their digital platforms or introduced through direct referrals.

These aren’t just tactical moves, they reflect a broader strategy. “Success in fintech is about plugging into the ecosystem and scaling through shared value.”

Beyond Invoices

While Aura started with invoice discounting, Shahrukh made it clear that this is just the starting point. “We had to build everything—onboarding, underwriting, loan origination, payouts, collections, reminders,” he said. “Now that we’ve built those rails, we can plug in other credit products.”

Aura’s foundational infrastructure—designed initially to serve invoice discounting—can now be reconfigured for a range of alternative lending products. These include: POS financing, invoice factoring (where the buyer consents to the invoice reassignment), and B2B Buy Now, Pay Later (BNPL).

The team’s longer-term vision? Evolve from being a standalone financing platform into an embedded financing layer across third-party platforms. Instead of having companies come to Aura for financing, Aura’s credit products will be natively available where businesses are already operating, whether that’s an accounting tool, marketplace, or POS system.

Empowering Local Businesses

Aura’s impact was clear from day one. One of its first customers even sent Shahrukh a heartfelt voice note, thanking the team for easing a burden that had weighed on them for years. It was a powerful reminder: Aura wasn’t just solving a financial gap—it was reducing stress, enabling growth, and unlocking freedom for businesses that had long felt boxed out.

This mission runs deeper than margins. “I’ve settled in this region; I’m building a life here,” Shahrukh says. “I want to see businesses in MENA and Pakistan grow faster. There’s massive potential here. And if entrepreneurs have access to the same financial infrastructure that exists in more developed markets, this region can level up”.

Subscribe to our newsletter to be the first to know when new Founder’s Hustle stories drop!