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.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
JAPANESE GRAND PRIX INFO
Schedule (All times UAE)
First practice: Friday, 5-6.30am
Second practice: Friday, 9-10.30am
Third practice: Saturday, 7-8am
Qualifying: Saturday, 10-11am
Race: Sunday, 9am-midday
Race venue: Suzuka International Racing Course
Circuit Length: 5.807km
Number of Laps: 53
Watch live: beIN Sports HD
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sep 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
Who was Alfred Nobel?
The Nobel Prize was created by wealthy Swedish chemist and entrepreneur Alfred Nobel.
- In his will he dictated that the bulk of his estate should be used to fund "prizes to those who, during the preceding year, have conferred the greatest benefit to humankind".
- Nobel is best known as the inventor of dynamite, but also wrote poetry and drama and could speak Russian, French, English and German by the age of 17. The five original prize categories reflect the interests closest to his heart.
- Nobel died in 1896 but it took until 1901, following a legal battle over his will, before the first prizes were awarded.
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Company: Instabug
Founded: 2013
Based: Egypt, Cairo
Sector: IT
Employees: 100
Stage: Series A
Investors: Flat6Labs, Accel, Y Combinator and angel investors
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Asia Cup 2018 Qualifier
Sunday's results:
- UAE beat Malaysia by eight wickets
- Nepal beat Singapore by four wickets
- Oman v Hong Kong, no result
Tuesday fixtures:
- Malaysia v Singapore
- UAE v Oman
- Nepal v Hong Kong
Retirement funds heavily invested in equities at a risky time
Pension funds in growing economies in Asia, Latin America and the Middle East have a sharply higher percentage of assets parked in stocks, just at a time when trade tensions threaten to derail markets.
Retirement money managers in 14 geographies now allocate 40 per cent of their assets to equities, an 8 percentage-point climb over the past five years, according to a Mercer survey released last week that canvassed government, corporate and mandatory pension funds with almost $5 trillion in assets under management. That compares with about 25 per cent for pension funds in Europe.
The escalating trade spat between the US and China has heightened fears that stocks are ripe for a downturn. With tensions mounting and outcomes driven more by politics than economics, the S&P 500 Index will be on course for a “full-scale bear market” without Federal Reserve interest-rate cuts, Citigroup’s global macro strategy team said earlier this week.
The increased allocation to equities by growth-market pension funds has come at the expense of fixed-income investments, which declined 11 percentage points over the five years, according to the survey.
Hong Kong funds have the highest exposure to equities at 66 per cent, although that’s been relatively stable over the period. Japan’s equity allocation jumped 13 percentage points while South Korea’s increased 8 percentage points.
The money managers are also directing a higher portion of their funds to assets outside of their home countries. On average, foreign stocks now account for 49 per cent of respondents’ equity investments, 4 percentage points higher than five years ago, while foreign fixed-income exposure climbed 7 percentage points to 23 per cent. Funds in Japan, South Korea, Malaysia and Taiwan are among those seeking greater diversification in stocks and fixed income.
• Bloomberg
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The alternatives
• Founded in 2014, Telr is a payment aggregator and gateway with an office in Silicon Oasis. It’s e-commerce entry plan costs Dh349 monthly (plus VAT). QR codes direct customers to an online payment page and merchants can generate payments through messaging apps.
• Business Bay’s Pallapay claims 40,000-plus active merchants who can invoice customers and receive payment by card. Fees range from 1.99 per cent plus Dh1 per transaction depending on payment method and location, such as online or via UAE mobile.
• Tap started in May 2013 in Kuwait, allowing Middle East businesses to bill, accept, receive and make payments online “easier, faster and smoother” via goSell and goCollect. It supports more than 10,000 merchants. Monthly fees range from US$65-100, plus card charges of 2.75-3.75 per cent and Dh1.2 per sale.
• 2checkout’s “all-in-one payment gateway and merchant account” accepts payments in 200-plus markets for 2.4-3.9 per cent, plus a Dh1.2-Dh1.8 currency conversion charge. The US provider processes online shop and mobile transactions and has 17,000-plus active digital commerce users.
• PayPal is probably the best-known online goods payment method - usually used for eBay purchases - but can be used to receive funds, providing everyone’s signed up. Costs from 2.9 per cent plus Dh1.2 per transaction.
