Abu Dhabi announces Dhs6bn boost for SMEs

The Abu Dhabi Department of Finance has announced a Dhs 6bn financing initiative to boost liquidity for SMEs.

The first phase of this scheme is in partnership with the National Health Insurance Company (Daman) and First Abu Dhabi Bank (FAB), aiming to provide liquidity to SMEs in the healthcare sector.

The funding taps into Ghadan 21’s SME credit guarantee scheme, a programme introduced to support SMEs in the aftermath of Covid-19. The funding will be extended in the future to include other banks and sectors.

Read: The SME Story: Daniel Domingues and Tariq Said, co-founders, Sirius Energy

The initiative facilitates quick payment of receivables owed to SMEs, thus reducing their cost of working capital. In 2019, SMEs in Abu Dhabi accounted for 29 per cent of GDP and 44 per cent of the non-oil economy. Supporting small businesses is seen as critical in Abu Dhabi’s diversification strategy to move towards a knowledge-based economy.

“SMEs are the lifeblood of the economy, and the key to long-term sustainable growth for the Emirate of Abu Dhabi,” said Jassem Mohammed Bu Ataba AlZaabi, chairman of the Abu Dhabi Department of Finance.

“As part of our forward-looking fiscal sustainability strategy, we are proactively launching this initiative to underpin continued liquidity for SMEs in Abu Dhabi. On behalf of the Department of Finance, I would like to thank our partners Daman and FAB for participating in this initiative and I am confident that our aligned vision will ensure its success.”

Read: GB Talks: Understanding SME financing in the UAE