UAE SME Sector Is Buoyant, Despite Global Challenges
RAKBank Steps Up Assistance To Key Sector
Small and medium-sized enterprises (SMEs) in the UAE have entered the second quarter of 2024 on a sound footing – registering remarkable growth and resilience – despite global economic challenges.
This scenario was highlighted at a news conference in Dubai hosted by RAKBank. The meeting, which sought to provide insights into the SME sector in the UAE, highlighted the crucial role of facilitating SME growth in the Arabian Gulf nation.
Addressing the media in the presence of Abdulaziz Al Nuaimi, Assistant Undersecretary for Economic Affairs and Entrepreneurship, UAE Ministry of Economy, Dhiraj Kunwar, Managing Director (Business Banking Group), RAKBank, revealed that in 2006, RAKBank provided 230 loans totalling AED 75 million in the UAE.
RAKBank, in its commitment to fostering entrepreneurship and innovation in the UAE, extended loans amounting to AED 3.5 billion in 2023 alone. This significant increase in support for UAE-based SMEs, with over 3,000 loans granted without collateral, underscores the bank’s dedication to SMEs and encourages more businesses to seek its support, Kunwar stated.
Diverse Customer Base
RAKBank’s dedication to supporting female entrepreneurs is evident, with over 40,000 women running businesses in the UAE. This commitment to inclusivity is further demonstrated by its diverse customer base, with 5,000 SMEs benefiting from its services.
Kunwar underscored the institution’s deep-rooted relationship with SMEs, stating that despite not being the largest bank in the UAE, it serves approximately 90,000 customers, with AED 20 billion in deposits.
RAKBank prides itself on its proactive approach to supporting SMEs. It goes beyond traditional banking services by offering SMEs access to educational content, webinars, and partnerships. These additional services are designed to aid in their growth and development, demonstrating the bank’s commitment to their success.
Kunwar also presented findings from a recent SME sentiment index in partnership with RFI Global, a leading market research firm. The index revealed a positive outlook among UAE-based SMEs, with a significant percentage confident about their prospects.
Key sectors such as construction and manufacturing showed robust growth, while areas like consumer and retail services exhibited cautious optimism due to rising operational costs.
Tech Role
In addition to economic factors, the RAK Bank-commissioned index highlighted the role of technology in driving SME growth, with many businesses embracing digital solutions to expand their reach and streamline operations.
Kunwar also addressed challenges such as access to credit and the importance of financial education for SMEs to avoid over-leveraging.
Kunwar and Raheel Ahmed, Group CEO of RAK Bank, acknowledged the increasing number of SMEs from abroad establishing themselves in the UAE while stressing the importance of tracking technology-based SMEs to understand their impact on the economy.
RAKBank, formerly the National Bank of Ras Al Khaimah, is one of the UAE’s pioneering financial institutions. Established in 1976, the bank embarked on a significant transformation journey in 2001, redirecting its focus from corporate banking to catering more comprehensively to personal and business banking needs.
Billing itself as the ‘leading SME bank in the UAE,’ RAKBank boasts diverse banking services tailored for individuals and businesses in the UAE, supplemented by digital banking solutions. Additionally, it offers Sharia-compliant banking services through its Islamic banking arm, RAKislamic.
The Government of Ras Al Khaimah owns 52.76% of the bank, and its shares are publicly traded on the Abu Dhabi Securities Exchange (ADX).
Featured image: Dhiraj Kunwar addressing the news media in Dubai. Credit: Arnold Pinto
