View of the interchange and Dubai skyline. Pawan Singh / The National
View of the interchange and Dubai skyline. Pawan Singh / The National
View of the interchange and Dubai skyline. Pawan Singh / The National
View of the interchange and Dubai skyline. Pawan Singh / The National

Why crowdfunding is important for the UAE


Alkesh Sharma
  • English
  • Arabic

The UAE government has approved the use of crowdfunding as the Emirates aims to open more streams of funding for smaller businesses and broaden the country's liquidity pool.

Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, said the Cabinet approved crowdfunding activity for both the public and private sectors.

“Crowdfunding is one of the best means to support the financing of new innovative business ideas … it will open a door for young people and entrepreneurs to finance their ideas,” he said on Twitter.

The National looks at the concept of crowdfunding and the possibilities it presents.

What is crowdfunding?

Crowdfunding — a type of alternative finance — refers to the practice of funding a project or venture by raising small amounts of capital from a large group of people, usually through the internet.

The global crowdfunding market is predicted to triple in size to $39.8 billion by 2026 from $13.9bn in 2019, according to Statista. The concept, which originated in the US, is gaining traction in the GCC's six-member economic bloc.

Why is it important for SMEs?

Start-ups and small and medium enterprises are moving towards crowdfunding as they explore funding options.

Abu Dhabi and Dubai are home to a number of tech start-ups that have based their headquarters in the UAE due to its business-friendly legislation.

The SME sector represents more than 94 per cent of total companies and employs over 86 per cent of the private sector workforce in the UAE, according to a Dubai Chamber report released in November 2020.

Within Dubai, SMEs account for 95 per cent of companies and employ 42 per cent of the workforce, contributing 40 per cent of the emirate’s economy, the report added.

Khalifa Fund data shows that nearly 50 per cent to 70 per cent of the SME applications for funding are rejected by conventional banks. Loans to SMEs account for just 4 per cent of the outstanding bank credit in the UAE, below the Middle East and North Africa average of 9.3 per cent.

Conventional lenders are sometimes unwilling or unable to support SMEs given their limited assets or lack of a track record.

Hence crowdfunding could help the UAE to support SMEs.

Where does the UAE stand in crowdfunding so far?

In May, Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, launched “Dubai Next” — a digital crowdfunding platform for supporting entrepreneurs and start-ups.

The initiative was aimed at stimulating “positive competition and encouraging youth to put forward innovative ideas as well as obtain community support through crowdfunding”, Sheikh Hamdan said at the time.

In September 2020, Dubai SME, part of Dubai's Department of Economic Development, said it was partnering with peer-to-peer lending platform Beehive to allow individuals to invest in SMEs in the country through crowdfunding.

In August 2017, the Dubai Financial Services Authority launched a regulatory framework for loan and investment-based crowdfunding platforms.

UAE start-ups leading in crowdfunding

The Dubai-based equity crowdfunding platform Eureeca led $1.3 million funding in pay-per-minute car rental platform Udriv in January last year.

Eureeca is one of the first global equity crowdfunding platforms that enables members of its investor network to buy shares in growth-orientated businesses.

Dubai's fresh snack company Fruitful Day is among smaller businesses that have used crowdfunding. The firm raised Dh3m ($816,771) in two successive funding rounds in November 2020, attracting investors from as far away as Switzerland and Singapore, as well as from Saudi Arabia and the UAE.

UAE start-up Rent-a-Towel, which currently rents towels and bed linen to 20 Dubai hotels, has invited sustainability-conscious small investors to part-fund inventory through a Germany-based crowdfunding platform.

Dubai-based Stake allows people to buy small stakes in properties starting from few hundred dollars. Described as a “digital-first property investment and asset management company”, Stake aims to fix the problems of property ownership “by democratising property investment”.

It finds competitively priced apartments in prime locations with high demand on the secondary market — avoiding potential new-build delays. It enables members to invest as little as Dh500. Investors receive regular dividends from rental income, in addition to expected long-term capital appreciation.

GCC getting serious about crowdfunding

Last January, the Saudi Central Bank rolled out new rules governing crowdfunding-based activities.

At that time, the kingdom's central bank set a minimum capital requirement of 5 million Saudi riyals ($1.33m) for entities looking for a licence for crowdfunding activities. It updated the crowdfunding rules in January.

The Central Bank of Bahrain has also rolled out crowdfunding regulations.

In-demand jobs and monthly salaries
  • Technology expert in robotics and automation: Dh20,000 to Dh40,000 
  • Energy engineer: Dh25,000 to Dh30,000 
  • Production engineer: Dh30,000 to Dh40,000 
  • Data-driven supply chain management professional: Dh30,000 to Dh50,000 
  • HR leader: Dh40,000 to Dh60,000 
  • Engineering leader: Dh30,000 to Dh55,000 
  • Project manager: Dh55,000 to Dh65,000 
  • Senior reservoir engineer: Dh40,000 to Dh55,000 
  • Senior drilling engineer: Dh38,000 to Dh46,000 
  • Senior process engineer: Dh28,000 to Dh38,000 
  • Senior maintenance engineer: Dh22,000 to Dh34,000 
  • Field engineer: Dh6,500 to Dh7,500
  • Field supervisor: Dh9,000 to Dh12,000
  • Field operator: Dh5,000 to Dh7,000
UAE currency: the story behind the money in your pockets
Keane on …

Liverpool’s Uefa Champions League bid: “They’re great. With the attacking force they have, for me, they’re certainly one of the favourites. You look at the teams left in it - they’re capable of scoring against anybody at any given time. Defensively they’ve been good, so I don’t see any reason why they couldn’t go on and win it.”

Mohamed Salah’s debut campaign at Anfield: “Unbelievable. He’s been phenomenal. You can name the front three, but for him on a personal level, he’s been unreal. He’s been great to watch and hopefully he can continue now until the end of the season - which I’m sure he will, because he’s been in fine form. He’s been incredible this season.”

Zlatan Ibrahimovic’s instant impact at former club LA Galaxy: “Brilliant. It’s been a great start for him and for the club. They were crying out for another big name there. They were lacking that, for the prestige of LA Galaxy. And now they have one of the finest stars. I hope they can go win something this year.”

if you go

The flights

Direct flights from the UAE to the Nepalese capital, Kathmandu, are available with Air Arabia, (www.airarabia.com) Fly Dubai (www.flydubai.com) or Etihad (www.etihad.com) from Dh1,200 return including taxes. The trek described here started from Jomson, but there are many other start and end point variations depending on how you tailor your trek. To get to Jomson from Kathmandu you must first fly to the lake-side resort town of Pokhara with either Buddha Air (www.buddhaair.com) or Yeti Airlines (www.yetiairlines.com). Both charge around US$240 (Dh880) return. From Pokhara there are early morning flights to Jomson with Yeti Airlines or Simrik Airlines (www.simrikairlines.com) for around US$220 (Dh800) return. 

The trek

Restricted area permits (US$500 per person) are required for trekking in the Upper Mustang area. The challenging Meso Kanto pass between Tilcho Lake and Jomson should not be attempted by those without a lot of mountain experience and a good support team. An excellent trekking company with good knowledge of Upper Mustang, the Annaurpuna Circuit and Tilcho Lake area and who can help organise a version of the trek described here is the Nepal-UK run Snow Cat Travel (www.snowcattravel.com). Prices vary widely depending on accommodation types and the level of assistance required. 

Top 10 in the F1 drivers' standings

1. Sebastian Vettel, Ferrari 202 points

2. Lewis Hamilton, Mercedes-GP 188

3. Valtteri Bottas, Mercedes-GP 169

4. Daniel Ricciardo, Red Bull Racing 117

5. Kimi Raikkonen, Ferrari 116

6. Max Verstappen, Red Bull Racing 67

7. Sergio Perez, Force India 56

8. Esteban Ocon, Force India 45

9. Carlos Sainz Jr, Toro Rosso 35

10. Nico Hulkenberg, Renault 26

THE SPECS

Engine: 3.9-litre twin-turbo V8

Transmission: seven-speed dual clutch

Power: 710bhp

Torque: 770Nm

Speed: 0-100km/h 2.9 seconds

Top Speed: 340km/h

Price: Dh1,000,885

On sale: now

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

While you're here
Ms Yang's top tips for parents new to the UAE
  1. Join parent networks
  2. Look beyond school fees
  3. Keep an open mind
The details

Colette

Director: Wash Westmoreland

Starring: Keira Knightley, Dominic West

Our take: 3/5

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
Honeymoonish
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Elie%20El%20Samaan%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3ENour%20Al%20Ghandour%2C%20Mahmoud%20Boushahri%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%203%2F5%3C%2Fp%3E%0A
PROFILE OF HALAN

Started: November 2017

Founders: Mounir Nakhla, Ahmed Mohsen and Mohamed Aboulnaga

Based: Cairo, Egypt

Sector: transport and logistics

Size: 150 employees

Investment: approximately $8 million

Investors include: Singapore’s Battery Road Digital Holdings, Egypt’s Algebra Ventures, Uber co-founder and former CTO Oscar Salazar

SCORES IN BRIEF

Lahore Qalandars 186 for 4 in 19.4 overs
(Sohail 100,Phil Salt 37 not out, Bilal Irshad 30, Josh Poysden 2-26)
bt Yorkshire Vikings 184 for 5 in 20 overs
(Jonathan Tattersall 36, Harry Brook 37, Gary Ballance 33, Adam Lyth 32, Shaheen Afridi 2-36).

FIXTURES

December 28
Stan Wawrinka v Pablo Carreno Busta, 5pm
Milos Raonic v Dominic Thiem, no earlier then 7pm

December 29 - semi-finals
Rafael Nadal v Stan Wawrinka / Pablo Carreno Busta, 5pm
Novak Djokovic v Milos Raonic / Dominic Thiem, no earlier then 7pm

December 30
3rd/4th place play-off, 5pm
Final, 7pm

How has net migration to UK changed?

The figure was broadly flat immediately before the Covid-19 pandemic, standing at 216,000 in the year to June 2018 and 224,000 in the year to June 2019.

It then dropped to an estimated 111,000 in the year to June 2020 when restrictions introduced during the pandemic limited travel and movement.

The total rose to 254,000 in the year to June 2021, followed by steep jumps to 634,000 in the year to June 2022 and 906,000 in the year to June 2023.

The latest available figure of 728,000 for the 12 months to June 2024 suggests levels are starting to decrease.

How to vote in the UAE

1) Download your ballot https://www.fvap.gov/

2) Take it to the US Embassy

3) Deadline is October 15

4) The embassy will ensure all ballots reach the US in time for the November 3 poll

Sugary teas and iced coffees

The tax authority is yet to release a list of the taxed products, but it appears likely that sugary iced teas and cold coffees will be hit.

For instance, the non-fizzy drink AriZona Iced Tea contains 65 grams of sugar – about 16 teaspoons – per 680ml can. The average can costs about Dh6, which would rise to Dh9.

Cold coffee brands are likely to be hit too. Drinks such as Starbucks Bottled Mocha Frappuccino contain 31g of sugar in 270ml, while Nescafe Mocha in a can contains 15.6g of sugar in a 240ml can.

Updated: March 22, 2022, 6:26 AM`