Financial support programs for businesses in the UAE
In the UAE, it has been established that if a new business or a business that has existed for a long time needs additional financing, the owners can apply to the bank for an additional loan of up to 1 million dirhams. As a business loan without collateral or security and set a fixed repayment period of 12 to 48 months. Business loans are encouraged in the UAE as there are many opportunities to start a new business in the UAE. You must be wondering what factors you should pay attention to before getting a business loan in the UAE. Here is the information about it.
- A business license is the most important factor to consider before applying for a business loan. This is a license granted by the UAE government that gives you the right to start a new business. A business license usually depends on the type of business you run.
- Next, you need to have a business agreement, passport, bank statements (most banks usually require 6/12 months bank statements), UAE ID.
- Eligibility criteria also apply when applying for a business loan in the UAE, although they vary from bank to bank.
- The business you are going to start must be in operation for at least a year.
- Business turnover must be 1 million dirhams.
- The business must include a sole proprietorship or partnership
Like all other loans, business loans also have their advantages because they provide you:
- Free credit cards, free life insurance
- The possibility of not submitting securities for obtaining a loan
- Flexibility to choose interest rates between fixed and declining interest rates.
So, receiving business support has its advantages, including:
- No collateral or security requirements, unhindered access to finance with minimal requirements
- Fairness in price formation with the obligation to maintain the commission and profit rate among the lowest on the market
- Transparency of activity, clear, detailed and understandable grounds for activity and qualification requirements
- Available repayment options from 12 to 48 months
There are quite a lot of banks in the UAE, about 30 and many of them offer business loans, the best among them are:
- Abu Dhabi Commercial Bank
- Dubai Islamic Bank
- Emirates NBD
- Emirates Islamic Bank
- Noor Islamic Bank
What documents are required to obtain a business loan in the UAE?
Depending on the bank, different documents may be required, but the main list is as follows:
- Business ownership documents
- Application form
- Constituent documents (charter, founding agreement or partnership agreement)
- Bank statements for the last 6-12 months
- Valid passports of all partners (must have a residence visa for expatriates)
What loans can be granted?
- Loans for starting a business, for startups – are provided for companies with 51 to 100% of the authorized capital owned by UAE citizens, financing is provided for companies with work experience from 6 months to 3 years, the amount of such a loan is from 300,000 to 2,000 000 million AED
- Loans for business expansion – already existing for a long time, the amount of such financing is up to 2 million UAE dirhams, with a term of up to 72 months.
Important! When getting a loan, the bank may often ask for additional documents, including a business plan. Banks will scrutinize the business plan to see if the company has a clear vision and realistic expectations for its success. Even if your application is perfect and meets all the requirements, a poor business plan can cause rejection.
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