UAE Banks Boost SME Lending to $22bn
Small and medium-sized enterprises (SMEs) in the UAE received a significant financial boost as banks extended 81.2 billion dirhams ($22.1 billion) in loans and financial facilities by the end of the first half of 2024. This figure, reported by the Central Bank of the UAE (CBUAE), represents 9.5 percent of the total financial support directed to the commercial and industrial sectors, which amounted to 855.7 billion dirhams.
The substantial lending to SMEs underscores their vital role in the UAE’s economy, where they account for over 95 percent of all enterprises and employ approximately 86 percent of the private sector workforce. This financial support aligns with the UAE government’s initiatives to nurture SME growth, including the National SME Program and the SME Finance Facilitator Program introduced by the Abu Dhabi Department of Economic Development.
Government Initiatives Bolster SME Growth
The UAE government has implemented various programs to support SMEs, recognizing their importance to the national economy. The National SME Program, operated by the Ministry of Economy and overseen by the UAE SME Council, offers business support services, including training, technical expertise, and opportunities to participate in international exhibitions. Additionally, SMEs benefit from preferential loans through the Emirates Development Bank and receive assistance with marketing and access to market data for strategic decision-making.
Dubai Attracts New Small Businesses
The increased support for SMEs has contributed to a surge in new business establishments, particularly in Dubai. In 2023, the emirate witnessed a 550 percent year-on-year increase in the number of new small companies from Asia and Australia setting up operations. This growth, with 104 new businesses established in the 12 months leading up to December, aligns with Dubai’s ambition to double its economy and cement its position as a top global city.
