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LOAN FOR BUSINESS IN THE UAE
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
- Amlak
- Barclays
- Dubai Islamic Bank
- Emirates NBD
- Emirates Islamic Bank
- HSBC
- Noor Islamic Bank
- Rakbank
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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1 question
Are you currently in Ukraine?
2 question
Are you currently in the UAE?
3 question
Do you already have a business in the UAE and want to get a loan?
4 question
Are you planning to register a business in the UAE?
5 question
Have you already chosen a bank in which you will take a loan and in which you need legal support when obtaining a loan?
6 question
Is the amount of the loan that you plan to receive more than 500,000 euros?
7 question
Do you need a consultation urgently?
Which is better: Mainland or Free Zone?
Mainland is generally suitable for businesses planning to operate directly in the UAE domestic market, maintain a physical location, premises or a local team. Free Zone is often chosen for international services, IT, e-commerce, consulting, trade and other models with specialised infrastructure. The choice depends on the activity, clients, office, visas, account and tax model.
Can a foreigner own 100% of a company in the UAE?
Yes, Free Zones allow 100% foreign ownership, and most Mainland activities are also available for full foreign ownership. Special restrictions, approvals or ownership structure requirements may apply to certain strategic impact activities.
Does a Free Zone company pay 0% Corporate Tax?
Not automatically. The 0% rate applies to Qualifying Income of a company that meets the requirements of a Qualifying Free Zone Person. Other taxable income may be subject to the 9% rate. The company must also register for Corporate Tax, maintain records and submit returns.
When does a company need VAT registration?
For resident businesses, mandatory registration generally arises when taxable supplies and imports exceed AED 375,000 during the previous 12 months or are expected to exceed this amount within the next 30 days. Voluntary registration is possible from AED 187,500. Different rules may apply to non-residents and certain cross-border transactions.
Is it mandatory to obtain a residence visa?
Not for every structure. A company may be registered without immediately obtaining an owner’s visa if the relevant jurisdiction allows it. At the same time, a residence visa and Emirates ID may be important for living in the UAE, banking KYC, leasing, connecting certain services and demonstrating local presence.
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