Ajman Bank signs deal on credit guarantee, co-lending programme for SMEs

Ajman Bank, one of the Shariah-compliant banks in the UAE, has signed a memorandum of understanding with the Emirates Development Bank [EDB] to offer credit guarantee and co-lending for small and medium-sized enterprises [SMEs] in the UAE.

EDB will provide a credit guarantee and/ or co-lending programme to the Ajman Bank’s SME customers. Ajman Bank will offer up to Dhs10m financing to an SME, and 50 per cent of the facility amount will be either guaranteed or co-lent by EDB. The collaboration also aims to support UAE citizens in the startup journey by offering financing facilities of up to Dhs1m, wherein 60 per cent is guaranteed or co-lent by EDB.

The agreement was signed by Mohamed Amiri, chief executive officer of Ajman Bank and Ahmed Mohamed Al Naqbi, chief executive officer of EDB.

The credit guarantee and co-lending programme is part of a platform that EDB has worked out with Ajman Bank to increase their SME segment’s financial lending, focusing on the priority industrial sectors — manufacturing, healthcare, infrastructure, and food security and technology.

Speaking about the MoU, Amiri said: “Access to finance is vital for the growth of business. We believe as part of this MoU more businesses especially the small and medium size enterprises in the UAE will have access to the benefits of our unique financial products and services that will contribute to boost the country’s development.”

Commenting on the agreement, Al Naqbi, said: “The increased financial accessibility to the SMEs – the backbone of the country’s economy – will not only help them develop and grow their business but also boost their contribution to UAE’s non-oil GDP. Together, we aim to support companies and entrepreneurs to have access to wider financing options, which will serve the country’s efforts of building a knowledge-based economy and contribute to sustainable economic development.”