I was sacked from a company in April 2015, where I worked as an operations manager earning Dh6,500. I decided to start a new company trading in marine spare parts to take revenge and show my old employer my courage. To raise the initial capital I took a loan in my home country of India for approximately Dh82,000, with an interest rate of 14 per cent for a tenure of three years. I still owe Dh80,000, which I need to pay over the next 18 months. Everything went fine in the beginning but the repayments on my loan as well as the non payment of credit card bills in the UAE pulled me into more debt. Plus, whenever I had no money in the UAE for daily expenditure, I used my Indian credit cards to purchase groceries – so on them I owe a further Dh8,000. I use my pension from serving in India's armed forces to pay for the credit card debts. Here in the UAE I have five credit cards and I have also used the cards of two friends. In total, on those seven cards, I owe Dh152,300. The interest alone on all these cards comes to a huge amount and it's taking more than the profit of my business every month. Plus I have to pay my house rent of Dh1,500 a month and my car payment of Dh1,717. Those who had stood by me offering support then turned their back on me when the finance matter entered. I have already downsized to a studio flat with the lowest rent in an industrial area to cut down my expenses. I no longer have any staff in my company and had to leave my office due to non payment to the real estate owner. I've ended up with no money to run my business and no bank will offer me a loan. The problem was because companies that I had supplied goods to kept their payments pending. In total I'm owed Dh125,000 so I cannot stop the business but I also cannot do any more business as I have no money to fund it. What do you advise? LL, Dubai
Debt panellist 1: Ambareen Musa, founder and chief executive of Souqalmal.com
The decision to start a business should be well-thought out and carefully planned. However, in this case it is clear that you solely relied on debt and without much financial planning.
So now you have Dh88,000 worth of loan and credit card debt in India, and Dh152,300 worth of credit card debt in the UAE. Since, your monthly pension in India is helping you repay the debts back home, your primary focus should be to pay off the heavy credit card debt you’ve accumulated here.
Unfortunately in your case, the business has been up and running for barely two years, and some start-ups do usually take longer to become established and start seeing steady revenues. However, the financial foundation of your business is all debt, and whatever money you make in the process is going toward debt repayments.
Being self-employed in the UAE makes it nearly impossible for you to apply for debt consolidation of any sort, and your best bet would be to convince the card providers to convert the outstanding balance into a fixed-interest fixed-tenure loan.
From what you’ve described here, your business doesn’t seem sustainable anymore. On top of that you have living expenses to think about in the UAE. Have you asked yourself the big question — is it time to call it quits? You have run out of financial resources to keep your business running, so maybe you should consider winding the business up and taking the legal route to recover your pending payments. Is there any inventory or assets locked up in the business that you could liquidate? Whatever you’re able to recover from the business can go towards repaying your credit card debts. And you should then consider looking for a job to help support yourself financially, at least until the time your debts have been cleared.
Debt panellist 2: Rasheda Khatun Khan, a wealth and wellness planner
Starting your own business certainly has its merits. Running it successfully requires planning and understanding cash flow. Having a product that has demand is only the start – it’s a great start, but still only the start.
Understanding cash flow is one of the key elements to building and maintaining a successful business. Be careful of over credit exposure. This is one of the most common mistakes that new business owners make; starting a business with too much debt and at a rate the business cannot afford puts the company in a very bad starting position. Paying 14 per cent for your loan means your company profits need to be that just to break even, and this is not even taking into account the amount of the loan capital. If starting a business means you have no money to pay for your basic lifestyle costs, then you should seriously consider not starting a business at that time. You should have savings you can rely on for income initially until your business can afford to pay you. Cash flow can make or break a business. Have a clear and detailed plan before making any business decisions.
In your current situation, focus on finding an investor to come into your business. Create an attractive investment opportunity. Make sure you have clarity in your numbers. If you know you have a good product and business model and you just need cash flow, then work out how much you need to put into your business to make it a success together with an attractive gain for an investor. If the numbers are right, there is no reason why a savvy investor would not want a piece of the pie.
On other debts, look out for debt consolidation companies in India. Consolidating your credit cards right now will release pressure in your personal cash flow. Can you turn to family members for support at this time? What other resources do you have to earn other income. Take some time to brainstorm ideas of how you can make money. Focus on the resources you have right now, not the ones you don’t.
The Debt Panel brings together four financial experts: Philip King, the head of retail banking in the UAE at Abu Dhabi Islamic Bank; Ambareen Musa, the founder and chief executive of the comparison website Souqalmal.com; Rasheda Khatun Khan, a wealth and wellness planner and founder of Design Your Life; and Keren Bobker, The National's On Your Side columnist and an independent financial adviser with Holborn Assets in Dubai. Together they answer queries in a weekly online column to help readers better tackle their debts. If you have a question for the panel, write to pf@thenational.ae.
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KEY DEVELOPMENTS IN MARITIME DISPUTE
2000: Israel withdraws from Lebanon after nearly 30 years without an officially demarcated border. The UN establishes the Blue Line to act as the frontier.
2007: Lebanon and Cyprus define their respective exclusive economic zones to facilitate oil and gas exploration. Israel uses this to define its EEZ with Cyprus
2011: Lebanon disputes Israeli-proposed line and submits documents to UN showing different EEZ. Cyprus offers to mediate without much progress.
2018: Lebanon signs first offshore oil and gas licencing deal with consortium of France’s Total, Italy’s Eni and Russia’s Novatek.
2018-2019: US seeks to mediate between Israel and Lebanon to prevent clashes over oil and gas resources.
Company Profile
Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed
What is type-1 diabetes
Type 1 diabetes is a genetic and unavoidable condition, rather than the lifestyle-related type 2 diabetes.
It occurs mostly in people under 40 and a result of the pancreas failing to produce enough insulin to regulate blood sugars.
Too much or too little blood sugar can result in an attack where sufferers lose consciousness in serious cases.
Being overweight or obese increases the chances of developing the more common type 2 diabetes.
In numbers
1,000 tonnes of waste collected daily:
- 800 tonnes converted into alternative fuel
- 150 tonnes to landfill
- 50 tonnes sold as scrap metal
800 tonnes of RDF replaces 500 tonnes of coal
Two conveyor lines treat more than 350,000 tonnes of waste per year
25 staff on site
MATCH INFO
CAF Champions League semi-finals first-leg fixtures
Tuesday:
Primeiro Agosto (ANG) v Esperance (TUN) (8pm UAE)
Al Ahly (EGY) v Entente Setif (ALG) (11PM)
Second legs:
October 23
Scoreline:
Manchester City 1
Jesus 4'
Brighton 0
Types of policy
Term life insurance: this is the cheapest and most-popular form of life cover. You pay a regular monthly premium for a pre-agreed period, typically anything between five and 25 years, or possibly longer. If you die within that time, the policy will pay a cash lump sum, which is typically tax-free even outside the UAE. If you die after the policy ends, you do not get anything in return. There is no cash-in value at any time. Once you stop paying premiums, cover stops.
Whole-of-life insurance: as its name suggests, this type of life cover is designed to run for the rest of your life. You pay regular monthly premiums and in return, get a guaranteed cash lump sum whenever you die. As a result, premiums are typically much higher than one term life insurance, although they do not usually increase with age. In some cases, you have to keep up premiums for as long as you live, although there may be a cut-off period, say, at age 80 but it can go as high as 95. There are penalties if you don’t last the course and you may get a lot less than you paid in.
Critical illness cover: this pays a cash lump sum if you suffer from a serious illness such as cancer, heart disease or stroke. Some policies cover as many as 50 different illnesses, although cancer triggers by far the most claims. The payout is designed to cover major financial responsibilities such as a mortgage or children’s education fees if you fall ill and are unable to work. It is cost effective to combine it with life insurance, with the policy paying out once if you either die or suffer a serious illness.
Income protection: this pays a replacement income if you fall ill and are unable to continue working. On the best policies, this will continue either until you recover, or reach retirement age. Unlike critical illness cover, policies will typically pay out for stress and musculoskeletal problems such as back trouble.
Company Profile
Name: Direct Debit System
Started: Sept 2017
Based: UAE with a subsidiary in the UK
Industry: FinTech
Funding: Undisclosed
Investors: Elaine Jones
Number of employees: 8
ACC T20 Women’s Championship
UAE fixtures
Friday, June 17 v Oman
Saturday, June 18 v Singapore
Monday, June 20 v Malaysia
Wednesday, June 22 v Qatar
Friday, June 24, semi-final
Saturday, June 25, final
UAE squad: Chaya Mughal (captain), Esha Oza, Indhuja Nandakumar, Kavisha Kumari, Khushi Sharma, Lavanya Keny, Priyanjali Jain, Rithika Rajith, Samaira Dharnidharka, Sanchin Singh, Siya Gokhale, Suraksha Kotte, Theertha Satish, Vaishnave Mahesh
It’ll be summer in the city as car show tries to move with the times
If 2008 was the year that rocked Detroit, 2019 will be when Motor City gives its annual car extravaganza a revamp that aims to move with the times.
A major change is that this week's North American International Auto Show will be the last to be held in January, after which the event will switch to June.
The new date, organisers said, will allow exhibitors to move vehicles and activities outside the Cobo Center's halls and into other city venues, unencumbered by cold January weather, exemplified this week by snow and ice.
In a market in which trends can easily be outpaced beyond one event, the need to do so was probably exacerbated by the decision of Germany's big three carmakers – BMW, Mercedes-Benz and Audi – to skip the auto show this year.
The show has long allowed car enthusiasts to sit behind the wheel of the latest models at the start of the calendar year but a more fluid car market in an online world has made sales less seasonal.
Similarly, everyday technology seems to be catching up on those whose job it is to get behind microphones and try and tempt the visiting public into making a purchase.
Although sparkly announcers clasp iPads and outline the technical gadgetry hidden beneath bonnets, people's obsession with their own smartphones often appeared to offer a more tempting distraction.
“It's maddening,” said one such worker at Nissan's stand.
The absence of some pizzazz, as well as top marques, was also noted by patrons.
“It looks like there are a few less cars this year,” one annual attendee said of this year's exhibitors.
“I can't help but think it's easier to stay at home than to brave the snow and come here.”
COMPANY PROFILE
Company: Eco Way
Started: December 2023
Founder: Ivan Kroshnyi
Based: Dubai, UAE
Industry: Electric vehicles
Investors: Bootstrapped with undisclosed funding. Looking to raise funds from outside
COMPANY PROFILE
Company name: Almouneer
Started: 2017
Founders: Dr Noha Khater and Rania Kadry
Based: Egypt
Number of staff: 120
Investment: Bootstrapped, with support from Insead and Egyptian government, seed round of
$3.6 million led by Global Ventures
Stats at a glance:
Cost: 1.05 billion pounds (Dh 4.8 billion)
Number in service: 6
Complement 191 (space for up to 285)
Top speed: over 32 knots
Range: Over 7,000 nautical miles
Length 152.4 m
Displacement: 8,700 tonnes
Beam: 21.2 m
Draught: 7.4 m
KEY DATES IN AMAZON'S HISTORY
July 5, 1994: Jeff Bezos founds Cadabra Inc, which would later be renamed to Amazon.com, because his lawyer misheard the name as 'cadaver'. In its earliest days, the bookstore operated out of a rented garage in Bellevue, Washington
July 16, 1995: Amazon formally opens as an online bookseller. Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought becomes the first item sold on Amazon
1997: Amazon goes public at $18 a share, which has grown about 1,000 per cent at present. Its highest closing price was $197.85 on June 27, 2024
1998: Amazon acquires IMDb, its first major acquisition. It also starts selling CDs and DVDs
2000: Amazon Marketplace opens, allowing people to sell items on the website
2002: Amazon forms what would become Amazon Web Services, opening the Amazon.com platform to all developers. The cloud unit would follow in 2006
2003: Amazon turns in an annual profit of $75 million, the first time it ended a year in the black
2005: Amazon Prime is introduced, its first-ever subscription service that offered US customers free two-day shipping for $79 a year
2006: Amazon Unbox is unveiled, the company's video service that would later morph into Amazon Instant Video and, ultimately, Amazon Video
2007: Amazon's first hardware product, the Kindle e-reader, is introduced; the Fire TV and Fire Phone would come in 2014. Grocery service Amazon Fresh is also started
2009: Amazon introduces Amazon Basics, its in-house label for a variety of products
2010: The foundations for Amazon Studios were laid. Its first original streaming content debuted in 2013
2011: The Amazon Appstore for Google's Android is launched. It is still unavailable on Apple's iOS
2014: The Amazon Echo is launched, a speaker that acts as a personal digital assistant powered by Alexa
2017: Amazon acquires Whole Foods for $13.7 billion, its biggest acquisition
2018: Amazon's market cap briefly crosses the $1 trillion mark, making it, at the time, only the third company to achieve that milestone
