What a feasibility study for QDB financing needs to show

A feasibility study for Qatar Development Bank (QDB) financing has one job: to show that the project can repay what it borrows. QDB’s direct financing covers up to 60% of a project’s total cost, up to 80% of equipment and machinery, and up to 100% of raw materials and of salaries and rent for the first six months, repayable over up to 15 years with a grace period of up to three years (Exhibit 1).¹ At least 40% of the total cost therefore has to come from somewhere else, usually the sponsors, and the study has to show where.

Those limits are maximums, and QDB sets the actual amount after it assesses the project. That assessment rests largely on the study. QDB lists a feasibility study among the documents required for direct financing.¹ For a new venture with no trading history, the study is often the only evidence a lender has. This explainer covers what QDB looks for, the five questions a study has to answer, and how to prepare one that a credit team can test.

Why lenders read a study for risk

QDB’s own lending is growing. In 2025 it raised its total financing commitments by 5% to more than 630 companies, taking its portfolio to QAR 7.3 billion, and disbursed QAR 2 billion directly, 30% more than in 2024.^{2, 3}

Bank credit to small and medium-sized enterprises (SMEs) remains a small part of the market. The latest edition of the SME lending report that QDB compiles from bank data, covering 2023, puts the SME credit balance at QAR 17.8 billion, about 3% of all credit to the private sector.⁴

The same report explains why lenders are careful. The non-performing loan (NPL) ratio for SMEs was 10.5% in 2023, down from 14.9% in 2022 but still well above the 3.9% ratio for the private sector as a whole (Exhibit 2).⁴ Small enterprises had the highest ratio, at 14.8%. A study that cannot show how a project will repay its financing in a weak year gives a credit team little reason to approve it.

What QDB asks: Five questions a study must answer

QDB publishes the criteria for its Al-Dhameen credit guarantee program, which guarantees up to 50% of a financed amount, or up to 70% for low-ticket financing.⁵ Applicants must show the sponsors’ experience, an attractive market with proven demand, a clear management and execution plan, a sound credit record, and a commercially viable project, shown through audited financial performance or a feasibility study. Read together with the supporting documents QDB lists for its study assessment service, these criteria translate into five questions (Exhibit 3).⁶

Market demand: Prove the volume before the price

In our experience, demand is where weak studies most often fall short. A credit team will want to know how the market evidence was gathered: the method and dates of any fieldwork, and the roles and institutions of the people interviewed. Small surveys can test whether customers will accept a product, but they are weak ground for volume or price assumptions. Export sales should name target countries rather than a region, and projects that aim to replace imports benefit from a make-or-buy analysis that compares the full cost of local production with the price of imported products at the same point in the supply chain.

Capacity and costs: Build up from what the plant can really do

A sound study separates nominal capacity, the figure on the equipment quotations and set by the slowest machine on the line, from realizable capacity, which is lower. Sales are driven by the market, so utilization should start low and rise gradually as staff gain experience, and it should stay well below full capacity. Costs need the same discipline: at least two quotations from reputable manufacturers and dealers for main equipment, which QDB asks for when it finances machinery;⁷ electricity and water at Kahramaa rates; fuel at Woqod rates; and salaries checked against Qatar rates, including housing, transport, medical insurance, and residency permit fees.

QDB’s financing limits differ by cost item, so the capital budget needs the same breakdown. Machinery financing covers up to 80% of cost for a standalone purchase, or up to 100% of the assets within an overall limit of 80% of total project cost.⁷ Construction financing reaches up to 80% of construction cost in manufacturing and up to 70% in tourism, education, and healthcare.⁸ Both products require personal guarantees covering 100% of the financing. A sources-and-uses table then shows how each cost is funded, and loan schedules should match QDB’s terms, including grace periods of up to three years.¹ Working capital should rest on a realistic cash conversion cycle, and key ratios should be shown under both normal and stress scenarios.

A study that cannot show how a project will repay its financing in a weak year gives a credit team little reason to approve it.

The decision: State a clear go or no-go

A feasibility study is a decision document, and it should reach one conclusion, go or no-go, with no grey area. A study that finds the project feasible should state the conditions needed to achieve the projected results; one that finds it infeasible should propose alternatives that could make it viable. Financial tables and their analysis belong in the body of the report, not in annexes, and a short, focused study is easier for a credit team to test than a long one. QDB also offers a free study assessment that compares a study with its scope of work and minimum requirements and returns recommendations.⁶

Preparing a study a credit team can test

Teams preparing feasibility studies in Qatar for QDB financing can start with four steps.

• Start from QDB’s product terms. Choose the financing product first, then build the capital budget around its limits. A project that needs debt for most of its cost will not fit a product that finances up to 60% of total cost, and the gap is better found early.
• Show the sponsors’ contribution in cash terms. State how much equity the sponsors will put in, when, and from what source. With QDB direct financing capped at 60% of total cost, this is the first number a credit team will look for.
• Justify every assumption. Cite a quotation, a tariff, a benchmark, or fieldwork for each input. An expert’s opinion helps, but the study still has to explain the reasoning behind it.
• Test the downside and keep it short. Run lower volumes, lower prices, and higher costs, and show whether repayments are still met. Then put the recommendation, the financing request, and the key risks on the first pages.

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QDB’s financing terms cover only part of a project, and they depend on the bank’s view of the risk. The study is where that view is formed. Sponsors who prove demand, price every cost, show their own contribution, and test the downside give it what it needs to say yes, or a clear reason to rethink the project first.