Dubai Chamber, NBAD join hands to support SME finance

As part of its latest initiative to facilitate the growth of entrepreneurship, the Dubai Chamber of Commerce and Industry signed a Memorandum of Understanding with the National Bank of Abu Dhabi (NBAD) for providing financial services to small and medium enterprises in the Emirate. 

The signing ceremony, held at the Dubai Chamber premises on Wednesday, was attended by H.E. Hamad Buamim, Director General, Dubai Chamber, and Mr Saif Al Shehhi, Senior General Manager, Domestic Banking Division, NBAD, in the presence of senior officials from both organisations. 

Under the terms of the MoU, Dubai Chamber and NBAD will cooperate to foster the growth of SMEs operating in the Emirate by providing finance facilities of up to USD 100 million to the Chamber’s members from the SME sector. Besides offering competitive rates and tariffs and a speedy service involving granting of loans within three working days, the bank will also offer assistance in managing and utilisation of finances, better understanding of repayment, collection and recovery programmes, as well as business progress reviews to the representatives of small and medium enterprises. 

Commenting on the signing of the MoU, H.E. Buamim said: “The signing of this agreement with NBAD to support the financing of SMEs is very timely as the sector is underserved by the financial services industry and this partnership will allow us to be accessible to small businesses while providing liquidity to the sector drive to the overall growth of entrepreneurship in the Emirate. The service can benefit our members who reached by the end of January 2012 over 130 thousand members. Initially, during the first year of its launch, the scheme is expected to benefit more than 1,000 companies belonging to Dubai Chamber members.” 

H.E. Buamim informed that SMEs make up over 90% of businesses in Dubai and the UAE’s total bank lending of 3.85% to SME’s is lowest than other countries of the world although the sector’s contribution to the country’s GDP is 30-35%, therefore the need is to support the financing of this sector which is one of the most important economic sectors in Dubai. This initiative will not only encourage higher levels of trade but will also serve as an incentive for new companies to set up business in Dubai while boosting the overall performance of the sector, His Excellency added.

The Director General of Dubai Chamber informed that on its part, Dubai Chamber will facilitate meetings between NBAD and its members from SMEs looking for financial assistance. His Excellency further stressed that Dubai Chamber has initiated the SME Exporter of the Month award, which rewards trading firms who have achieved exceptional performance during a specific time. He also said that Dubai Chamber has earlier organized a financing roundtable and regularly offers mediation, arbitration and legal services as well as business networking opportunities to the SME sector and over 

In 2011 NBAD significantly increased its SME-exclusive services and products. 

“Small- and medium-sized entrepreneurs are a major contributor to economic growth in any economy,” said Saif Al Shehhi, the Senior General Manager of Domestic Banking Division of NBAD. “Since its inception in 1968, NBAD has been playing a significant and leading role in the economic and social development of the UAE, and NBAD believes boosting entrepreneurship would advance significantly the economic growth of the UAE and achieving the objectives of Abu Dhabi Vision 2030, which sets the blueprint for developing Abu Dhabi into a world destination for tourism and commerce.” 

NBAD has opened nine Business Banking Centres in Abu Dhabi’s Mina, Corniche, Khalifa Street, Abu Dhabi Industrial City, Al Ain, and Sharjah and in Dubai’s Jebel Ali and Sheikh Zayed Road and Bur Dubai. NBAD plans to have 14 business banking centres throughout the UAE by the first quarter in 2012. 

“We are pleased to launch a partnership with Dubai Chamber of Commerce and Industry, one of the most significant business enablers in the Emirate of Dubai,” said Haitham AlRefaie, the Head of Business Banking Group at NBAD. “The SME sector is an important engine of growth but it is still underserved by the financial services industry, this is why we partnered with Dubai Chamber to expand entrepreneurs’ access to NBAD.” 

The products NBAD has launched include three new current accounts. NBAD also launched Business Rent Finance, which offers short term loan to small- and medium-sized enterprises (SME) to cover their rent expenses. NBAD has also launched Visa Business Credit Card, that has no annual fee and its other special features include up to 50 days interest-fee grace period, travel insurance up to US$150,000, pre-set limits on individual cards, access to cash, consolidated payments as well as special offers and discounts. The card can offer a credit limit from AED20,000 up to AED500,000. 

“Our approach is to be accessible to SMEs and we are achieving this through opening business banking centres and by our partnerships to expand our geographical reach,” Al Refaie said.