Emirates Development Bank launched a National Supply Chain Finance platform on Sunday to help the country’s businesses and SMEs gain easy access to the working capital amid the coronavirus pandemic.
The initiative, used by buyers, suppliers and banks, will automate operations, mitigate risk and make finance easily accessible, EDB said in a statement on Sunday.
Supported by the UAE Government, the platform is developed by the state-owned bank in collaboration with the World Bank's International Finance Corporation and London technology vendor HPD LendScape.
“With SME’s facing an unprecedented challenge, accessing efficient finance is vital … EDB is filling the gap and has launched a first class platform,” Faisal Aqil Al Bastaki, EDB’s chief executive, said.
“Lenders and buyers should take advantage of the solution offered to ensure that SMEs continue to play their part in the UAE’s economic growth, long after Covid-19 has passed.”
The platform will help suppliers gain quicker access to money owed, while buyers will get more time to pay off their invoices.
The initial phase of the project, offering a payables finance solution, went live on Sunday. The next phase will offer a comprehensive suite of buyer and supplier-centric solutions, including Islamic Finance products, EDB said, without specifying the exact time of its launch.
EDB, which allocated Dh423 million for SME finance last year, is supporting the local businesses that are majority-owned (51 per cent or more) by the UAE nationals.
With two operational branches in Abu Dhabi and Dubai, it offers competitive interest rates and launched a Dh100m credit guarantee scheme for the SMEs in February last year.
The new facility supports the goals of the National Agenda under UAE Vision 2021, which focuses on boosting the contribution of SMEs to the country’s economy, with the aim of increasing it to 70 per cent of gross domestic product by next year.
The National Supply Chain Finance platform can adapt to different regulatory environments and local market requirements, allowing commercial banks to launch their own products and manage customised programmes, EDB said.
“Through an online portal accessible from any device, suppliers can interact with both buyers and funders in real time, can request finance with a click and all counter-parties enjoy personalised screens and increased visibility of accounts receivables in the supply chain,” it added.
EDB will also set up a new centre of excellence to provide expert support to local investors.