Alkhair Capital Saudi Arabia, a financial institute headquartered in Riyadh, has signed a Memorandum of Understanding (MoU) with KLAIM HOLDINGS LIMITED, a fintech specialized in buying medical claims to provide working capital to healthcare providers, to launch investment products with the aim of financing purchase of uncollected medical insurance claims from insurance companies.
Through this new partnership, Alkhair Capital aims to provide KLAIM with up to $50 million to serve more healthcare providers across the MENA region. Recognizing the cash flow difficulties faced by a large number of hospitals and medical clinics, whose waiting period ranges from 112 days on average to 270 days in some cases to collect financial claims from insurance companies, KLAIM has launched an electronic service to purchase medical claims and pay them in cash within seven days.
Khalid Al-Mulhem, Managing Director and CEO of Alkhair Capital Saudi Arabia, said: “In light of the challenges faced by the healthcare sector related to cash flows from medical insurance service providers, KLAIM has effectively found the best innovative solutions to these challenges. We believe in the ability of these solutions to revolutionise the MENA region’s healthcare and fintech industry and we are delighted to give our investors an opportunity to invest in this new revolution and support the growth of fintech and healthcare.”
Karim Dakki, CEO of KLAIM added: “This advanced financing service for healthcare providers is proving to meet high pent-up demand across the GCC, leading KLAIM to broaden its regional footprint. “We are excited that this partnership with Alkhair Capital is coming on the heels of our expansion into Saudi Arabia and Oman. The growth and prosperity of the healthcare sector depends on the financial stability of healthcare providers, and we are pleased that through this partnership, we can facilitate collection, provide the necessary cash flow and help more healthcare providers achieve this stability."
This partnership provides Alkhair Capital with an opportunity to provide its investors with new products to diversify their Shariah-compliant options and investments in the thriving healthcare sector in the region using latest financial technology trends based on data-driven analysis and artificial intelligence solutions in revenue cycle management.
The fact that insurers take between 112 and 270 days to process and release payments for medical claims has been a huge hurdle to growth for healthcare providers in the region. Large healthcare providers lament the high cost of servicing the loans they have to take from banks to keep up with their operational costs, while the smaller ones are left stranded due to the difficulty of getting access to those loans.
A recent MEA Home Healthcare Market report expects that the MENA region’s healthcare industry will grow by 7.7% CAGR between 2021 and 2026. The partnership between Alkhair Capital and KLAIM, and other such future partnerships, will help to reduce the cash flow strain that is threatening to stunt the growth of healthcare providers so that the overall industry can achieve its full potential.