Home GCC UAE UAE Central Bank extends Targeted Economic Support Scheme until June 2021 The TESS loan deferral programme has already benefited over 310,000 retail customers, nearly 10,000 SMEs and more than 1,500 private sector companies by Varun Godinho November 17, 2020 The Central Bank of the UAE (CBUAE) will extend the validity of key components of its economic stimulus package called the Targeted Economic Support Scheme (TESS) until June 30, 2021. The CBUAE will extend the duration of the Zero Cost Facility (ZCF) of Dhs50bn, which benefits retail and corporate banking customers and facilitates liquidity management for banks through collateralised funding at zero cost, for an additional period of six months, reported news agency WAM. Hence, starting January 1, 2021, banks and finance companies participating in the TESS will be able to provide new loans and facilities to customers affected by the pandemic. “The Central Bank remains committed to supporting the financial system of the UAE by taking the required measures to accelerate economic recovery from Covid-19 repercussions. The extension of applicability period of the TESS will provide relief for retail, small and medium sized enterprises, and corporate banking customers,” said Abdulhamid M. Saeed Alahmadi, governor of the CBUAE. “We believe that this initiative will shield the economy from the impact of the pandemic and place us in an ideal position to recover, once the pandemic is over.” The Dhs100bn TESS initiative was launched by the CBUAE in March 2020 to support the UAE’s economy during the Covid-19 pandemic, which consisted of zero-interest, collateralised loans worth Dhs50bn for local banks and an additional Dhs50bn freed up from banks’ capital buffers. Read: UAE Central Bank announces Dhs100bn package to counter Covid-19 According to the terms of TESS, participating banks can use the funding to offer temporary relief to private sector and retail customers for a period of up to six months. The scheme also aims to ease principal and interest payments on outstanding loans. To date, the TESS loan deferral programme has benefited over 310,000 retail customers, nearly 10,000 SMEs and more than 1,500 private sector companies. The CBUAE also announced a gradual implementation schedule of the remaining parts of the Basel III compliance project in three stages, starting from Q2 2021 until Q2 2022, as part of its commitment to the application of the international regulatory standards in the UAE. In October, the CBUAE announced that it had withdrawn Dhs10.9bn from additional liquidity during the month of August to maintain economic resilience. Read: UAE Central Bank ramps up TESS scheme to support banking sector Tags Central Bank of the UAE Economy finance News UAE 0 Comments You might also like Insights: How UAE is enabling network transformation in the AI age NielsenIQ H1 report reveals region’s split shopper preferences Egypt’s central bank leaves overnight interest rates steady UAE’s Rebound launches subscription-based recycling platform