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Ehsaan Uddin Ahmed, the head of global transaction services and SME at Noor Islamic Bank, says the UAE economy is taking off. Jaime Puebla / The National
Ehsaan Uddin Ahmed, the head of global transaction services and SME at Noor Islamic Bank, says the UAE economy is taking off. Jaime Puebla / The National

Noor targets SMEs for loans growth

Noor Islamic Bank has become the latest lender to target the UAE's growing number of small and medium enterprises.

Noor Islamic Bank has become the latest lender to target the UAE's growing number of small and medium enterprises.

The bank, controlled by Dubai's Government, is looking to offer Dh5 billion worth of financing over the next five years.

"The economy is taking off," said Ehsaan Uddin Ahmed, the head of global transaction services and SME at Noor Islamic Bank. "A core of this economy are the SMEs. There is significant growth and new entities being established here."

Considered the lifeblood of most economies, SMEs account for nearly 90 per cent of companies in the UAE and provide about 85 per cent of private-sector employment.

Last week, Doha Bank said it had allocated Dh5.5bn for corporates and SMEs in the Emirates, while Emirates Islamic Bank renewed its commitment to its SME programme by offering special pricing for commercial vehicles and heavy machinery.

The recent surge in interest by lenders operating in the Emirates is a marked shift from the drought experienced by businesses in the wake of the global financial crisis.

"I would say it's a function of the global economic environment," Mr Ahmed said. "In 2008, not just the UAE, but the whole world took a step back. Therefore by being cautious, a lot of banks had limited risk appetite - not just for SMEs but larger corporates too."

Policymakers are banking on small to medium-sized businesses to play an important role in the diversification of the UAE economy.

The moves by the three banks come after calls made by the respective Department of Economic Development in Abu Dhabi and Dubai to support SMEs for development and jobs.

At a conference targeting investment in the Western Region last month, the undersecretary of Abu Dhabi's Department of Economic Development, Mohammed Omar Abdullah, said SMEs were a "very important target for us, especially as we look forward to developing the non-oil sector".

 

halsayegh@thenational.ae

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