Stark SME stats don’t tell the full story

The issue of lending to SMEs in the UAE was discussed at the Middle East Banking Forum in Abu Dhabi on Wednesday, where a number of solutions were raised to tackle a perceived dearth in funding for the country’s small businesses. Mubarak Rashed Al Mansoori, the governor of the Central Bank of the UAE, said the Bank was working on

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How can government acclimatise lenders to SMEs?

Over the past six months leaders in the banking sector have announced that SME owners and managers were departing the UAE with their companies in trouble and defaulting on their loans. The implication was that the SMEs were in trouble because of a contraction in the economy. However, the banks clarified that a portion of the defaults was because of

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SME financing needs from management's perspective

Small and medium enterprises (SMEs) have been getting a lot of attention in the past few years. Government initiatives such as the Khalifa Fund and Dubai SME 100 complement private initiatives seeking to provide financing for these SMEs. Everyone agrees that SMEs form an important part of the economy. Everyone also agrees that supporting SMEs is challenging. That is the

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Why SMEs are Survivors

عربي SMEs are a family’s lifeblood. They are built and run by families. They are not conglomerates with diversified business lines, they do not own monopoly agencies guaranteeing income, they do not have special connections to large clients securing lucrative contracts. SMEs are run by the blood, sweat and tears of the family members. If the SME fails then loved ones

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SMEs: The Ignored Middle Child of Banking?

عربي In developing various business plans for SME credit I often review why the commercial banks do not lend to this sector proportional to its contribution to GDP. I have written at length about some of my main ideas but I think there are several secondary issues that also play a role. One is the positioning of SME loans on the risk/reward

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Closing the SME Credit Gap

In last week’s article this column laid out the case that the current SME credit gap, estimated by the IFC to be at least USD 260 billion in the MENA region, could not be closed using currently available tools and institutions. There is an argument to be made that the potential exists to close the gap as the SME sector’s

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Standard Chartered UAE: Mishandling the SME Issue or just Misunderstood?

The National is reporting on customer backlash to Standard Chartered’s decision to shut down their SME business in the UAE. The fact that the bank is, according to The National, “provoking fury among customers” brings into question Standard Chartered’s commitment to its clients. The article by The National reports on the bank’s excuses for its behaviour. It also reports that

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The SME Credit Gap in the Middle East

عربي According to the IFC SMEs in the UAE represent 90% of total businesses. As a total percentage of GDP the estimates for rich MENA countries is estimated at approximately 51% contribution from SMEs with employment contribution at 62%. Paradoxically there is a SME credit gap in excess of USD 260 billion in MENA with only 4% of outstanding loans in

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