Foodics Invests in Funding Souq and Pledges $100 Million in Financing

Foodics, a restaurant technology and fintech company in the Middle East and North Africa region, has invested in the Saudi platform Funding Souq, which specializes in SME financing in accordance with Sharia guidelines, according to Wamda platform. The two companies did not disclose the value of the investment or the size of the stake acquired.

According to the agreement, the embedded financing service will extend to Foodics merchants, providing direct funding based on restaurant sales data and operational performance to evaluate creditworthiness, rather than relying solely on traditional collateral or credit histories.

Foodics says it intends to inject $100 million in financing during the first year of its Capital 2.0 program, meaning the partnership aims to transform daily restaurant data into a lending tool, rather than merely a technology service for managing them.

This comes at a time when embedded finance models are expanding within digital services across Saudi Arabia and the UAE. Observers believe that linking financing to a merchant's daily sales may reduce default risks, but it makes the lender a partner in the seasonal fluctuations of restaurant activity.

What do these terms mean?

Embedded Finance: A financing service integrated into a digital platform that the merchant already uses, offering it to them when needed without applying through a separate bank.

Islamic Finance: Financing structures that comply with Sharia provisions, excluding loan interest and relying on sales, partnerships, leasing, and other compliant structures.

Small and Medium Enterprises (SMEs): Small or medium-sized businesses measured by their capital, number of employees, or revenue, serving as the backbone of the region's economies.

Creditworthiness: An estimate of a borrower's ability and commitment to repay, based on their financial performance and past behavior.