Emirates Development Bank (EDB), the key financial engine of the UAE, and Abu Dhabi Islamic Bank have signed a partnership to support small and medium enterprises (SMEs) in the UAE through a joint finance guarantee scheme. 

 

This collaboration aims to enhance financial inclusion for SMEs, providing them with much-needed access to financing. EDB will guarantee up to 50% of the financing extended to SMEs by ADIB with a focus on supporting projects within EDB’s five priority sectors: Manufacturing, Food Security, Advanced Technology, Healthcare and Renewables.

 

Ahmed Mohamed Al Naqbi, Chief Executive Officer of EDB, said: "Our collaboration with ADIB is a significant milestone in our ongoing efforts to foster SME growth and financial inclusion. Through our finance guarantee scheme, in partnership with twelve of the largest commercial banks in the UAE, we are enabling businesses to overcome financial barriers and achieve their full potential. This new partnership amplifies the schemes’ reach and effectiveness while providing a model for how banks can drive sustainable and inclusive economic growth through strategic partnerships and a commitment to delivering impact.” 

 

Trusted partner

Mohamed Abdelbary, Acting Group Chief Executive Officer of ADIB, commented: “Our partnership with EDB reflects our ongoing commitment to empowering SMEs, the backbone of the UAE’s economy. This collaboration not only amplifies our ability to offer enhanced Sharia-compliant financial solutions but also strengthens our position as a trusted partner for growth-oriented businesses. 

 

“With this initiative, we are expanding our support to SMEs through customised financing options and comprehensive banking services that address their unique needs, enabling them to scale, innovate and contribute to the UAE’s long term economic vision.” 

 

As part of its strategic business offering, ADIB provides robust suite of Sharia Compliant products tailored for SMEs, including FX services, business finance, treasury solutions, and more. 

 

This partnership complements ADIB’s ongoing initiatives, such as the launch of ADIB Business Souq, an all-in-one digital marketplace aimed at significantly reducing the cost of doing business by offering a wide range of exclusive offers and discounts.

 

De-risking solution

EDB's Credit Guarantee Scheme is an innovative de-risking solution designed to incentivise commercial banks to extend financing to eligible SMEs that might otherwise face challenges in accessing finance due to perceived risks and long-term return on investment (ROI). By partnering with commercial banks, EDB provides partial guarantees up to 50 per cent of the financing extended to SMEs, capped at AED10 million. 

 

The impact is already evident. To date, EDB has provided AED1.58 billion ($430 million) in financing through the Guarantee Scheme, directly supporting the creation of 4,000 jobs. Since the launch of EDB’s strategy in April 2021, the Bank has significantly enhanced the financial inclusion of SMEs. 

 

By helping SMEs establish positive credit histories, the scheme empowers them to access future financing, driving growth and sustainability. EDB's innovative and partnership-driven approach is bolstered by its proprietary Development Impact Scorecard, which measures the financial and developmental potential of each lending, ensuring alignment with national economic and sustainable development goals. 

 

ADIB’s involvement amplifies the reach of the Guarantee Scheme, supporting EDB’s goal to provide AED30 billion in financing support by 2026, aligned with the UAE’s national economic and sustainable development goals.--TradeArabia News Service