8% average financing rate for small and medium-sized companies in the...

8% average financing rate for small and medium-sized companies in the...
8% average financing rate for small and medium-sized companies in the...

According to data compiled by Emirates Today, the average financing rate provided by the Emirates Development Bank is significantly lower than that provided by commercial and other Islamic banks, as the ratio is between 7% and 8%, while in other banks it reaches 17%.

An informed source, who preferred not to be named, said that the Emirates Development Bank provides great support to the owners of small and medium companies, not only at the level of the financing price, but in terms of payment facilities, postponement of installments and taking into account market conditions in line with the national agenda of the economy, as well as providing flexible and diverse solutions For companies seeking to expand into multiple sectors.

He pointed out that the nature of the projects themselves contributes to determining the profit rate on financing, as the innovative projects that serve the national agenda of the UAE enjoy preference, favorable terms and facilities.

He added that in addition to competitive financing rates, Emirates Development Bank also offers a financing guarantee program for small and medium-sized companies and emerging companies in the UAE, to overcome the financial challenges that hinder access to financing from traditional banks. This program is designed to improve SMEs’ access to finance by providing partial guarantee to lending banks, in the event that SMEs fail to pay their financial obligations.

According to the bank’s disclosure, Emirates Today obtained a copy of it: “Owners of small and medium enterprises have four types of financing, which are: Fixed commercial assets such as commercial vehicles, construction equipment, medical and professional equipment, at a rate of up to 80% of the asset value.

As for the second type of financing, it is designated for business expansion and meets the short and medium needs of the business owner, whether with or without guarantees, according to the financial and qualitative evaluation of the business, with flexibility in repayment periods and attractive profit rates.

According to the disclosure, the third type includes financing of purchases and bids, which is known as pre-sale financing, with up to 80% of the invoice value through a revolving loan with flexible payment options.

As for the fourth and final type, it is after-sales financing directed to sales and invoices.

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