Emirates Development Bank inks MoU with Mashreq for SME credit guarantee programmes
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Emirates Development Bank inks MoU with Mashreq for SME credit guarantee programmes

Emirates Development Bank inks MoU with Mashreq for SME credit guarantee programmes

Mashreq will offer financing of up to Dhs10m to SME customers, of which 50 per cent will be guaranteed or co-lent by EDB

Mashreq Bank Emirates Development Bank

Emirates Development Bank (EDB) has signed an MoU with Mashreq Bank to provide credit guarantee programmes for SMEs in the country.

EBD will provide credit guarantees and co-lending programmes to Mashreq Bank’s SME customers, to support with expenses towards activities including the purchase of equipment and fixtures, construction of work premises, business expansion, purchase of inventory, supplies and raw materials as well as general financing needs for payments such as salaries or rent.

Mashreq will offer a mix of capex as well as working capital facilities of up to Dhs10m to SME customers, of which 50 per cent of the facility amount will be guaranteed or co-lent by EDB.

Additionally, the credit guarantee programme also aims to support Emiratis by offering financing of up to Dhs1m, wherein 60 per cent is guaranteed or co-lent by EDB.

“SMEs represent more than 94 per cent of companies in the UAE, employing about 86 per cent of the country’s private sector workforce, and generating 52 per cent of the non-oil GDP. Mashreq is delighted to partner with Emirates Development Bank on this initiative, thus ensuring that the UAE’s key value chain drivers; its job-creating SMEs – are provided with better access to financing to meet their operational needs,” said Ahmed Abdelaal, group CEO of Mashreq.

Ahmed Mohamed Al Naqbi, CEO of EDB added: “SMEs are the backbone of UAE’s economy and the government has placed considerable emphasis on developing the SME ecosystem and boosting their contribution to UAE’s non-oil GDP.

“Our partnership with Mashreq Bank will help facilitate financing through credit guarantee and co-lending options to SMEs and allow greater operational flexibility to the entities. This is part of recently announced EDB’s strategy to enable UAE’s economic diversification and provide financing support to SMEs operating in key sectors.”

EDB has recently signed similar agreements with several other financial institutions and platforms in the country to support SMEs, including Commercial Bank of Dubai, NBQ and Beehive.

Earlier this month, EDB also listed a $750m bond on Nasdaq Dubai.

Read: Emirates Development Bank lists $750m bond on Nasdaq Dubai

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