The Banking Executive Magazine - February 2022

UAE's Emirates Development Bank UAE's Emirates Development Bank, DIB SIGN DEAL TO BOOST SME FINANCING The state-run Emirates Development Bank (EDB) has signed a deal with UAE lender Dubai Islamic Bank (DIB) to set up a credit guarantee scheme and disburse 200 million UAE dirhams ($54.4 million) in fi- nancing for small and medium-sized enterprises (SMEs). The deal is part of a strategy to sup- port SMEs in the country, particularly Emirati-owned businesses, as well as start-ups that need funding assis- tance. Under the agreement, EDB will pro- vide a credit guarantee program to DIB’s SME customers. DIB will offer up to 10 million UAE dirhams in fi- nancing to businesses, with half of the facility amount being guaranteed by EDB. DIB is expected to disburse a total of 200 million UAE dirhams in financing. Priority will be given to businesses in sectors such as manufacturing, healthcare, infrastructure, food secu- rity and technology. Among those likely to benefit are enterprises that are 51 percent to 100 percent owned by a UAE national, as well as expa- triates with businesses in priority sec- tors. “The new scheme provides a solid platform for emerging national com- panies and entrepreneurs to explore new opportunities through innova- tion, such as smart industries, and it will assist SMEs and start-ups in the UAE to overcome the financial chal- lenges of accessing funding from banks,” the statement said. Ahmed Mohamed Al Naqbi, chief executive officer of EDB, said the bank is committed to supporting the UAE’s economic diversification strat- egy. “To achieve this, one of the pivotal steps is to bridge the funding gap for SMEs, particularly those operating in priority economic sectors.” SMEs account for 94 percent of the total number of companies in the UAE, employing more than 86 per- cent of the workers in the private sec- tor. ISSUE 158 FEBRUARY 2022 the BANKING EXECUTIVE 17