Abdulla Al Darmaki, the chief executive of Khalifa Fund for Enterprise Development, urges financial institutions to do more to promote small businesses.
Khalifa Fund chief urges UAE banks to do more to help small businesses
The financial community was urged to do more to help small businesses at the Abu Dhabi Entrepreneurship Forum yesterday.
A new small and medium enterprises (SME) draft law approved in June is set to be passed to promote the sector, but it would do little without further support, said Abdullah Al Darmaki, the chief executive of Khalifa Fund for Enterprise Development.
“There has been talk of an SME law that will empower our smaller companies, but one law is not going to create a vibrant SME landscape, especially when it is not in conjunction with a bankruptcy law,” said Mr Al Darmaki.
“I am not looking to copy-and-paste a law from the US or the UK. Our finance industry knows what to do, but there is nothing encouraging them to do it. Why are our banks posting record profits and the SME sector [is] not being part of the conversation?”
Understanding and reducing small business failure was high on the agenda at the forum yesterday.
The benefits of a healthy SME ecosystem were also discussed, with questions on how to create a healthier environment for companies. “The finance sector is missing out; banks should not only be about giving loans, but making an investment in small and medium-sized businesses and seeing what the returns are,” said Mr Al Darmaki.
“I guarantee that five years or more down the road, SME loans will play a huge part in the returns [for] our finance industry.”
Ahmed Hassan Al Mansoori, the chief executive of Al Mansouri Health Products, spoke of the difficulty in getting permission for a health supplement that helps in controlling diabetes.
“It is not easy to register this product here in the UAE. The Ministry of Health took one year … the other [government agencies] took between three and six months,” Mr Al Mansoori said.
“When we started we needed [a lot of] support and the Khalifa Fund financed us for the project. We hope we get some good support from the Government, especially the government hospitals and that will give us a good push.”
Businesspeople at the forum also spoke of licensing issues, particularly for products and services that do not fit conventional businesses.
Alicia Al Mutawa, the general manager of Alessia Couture, has difficulty in explaining the idea of couture cleaning.
“It’s not easy but you cannot give up. When it comes to the permits it tends to be hard, especially when it is an innovative product,” said Ms Mutawa. “I had to say it is not a laundry, it is not dry cleaning, it is couture cleaning at the very high end. So the licence was supposed to say ‘Couture Cleaning’, but it ended up as ‘Couture’.”