ECI and Emirates NBD sign pact to boost financing access for small enterprises

The UAE Trade Finance Gateway is a receivables financing marketplace that is designed to help local businesses obtain fast and easy access to credit

The UAE Trade Finance Gateway project was launched to mark the UAE’s Golden Jubilee. Khushnum Bhandari / The National

Etihad Credit Insurance (ECI), the UAE Federal export credit agency, signed a preliminary agreement with Emirates NBD and Crediti Fintech, for the implementation of the UAE Trade Finance Gateway that helps small and medium-sized businesses to access finance quickly.

The scheme launched as part of the UAE’s Golden Jubilee is a "receivables financing marketplace that is designed to help businesses based in the UAE to obtain fast and easy access to finance and boost their business”, ECI said on Sunday.

The public-private partnership will position the government body as the main channel, enabling ECI, banks and exporters to trade credit and financial solutions on one unified platform. The ECI insurance cover will allow businesses to obtain secured loans from Emirates NBD, powered by Crediti Fintech's Monimove platform, it said.

“The UAE Trade Finance Gateway addresses a number of challenges faced by exporters and re-exporters in obtaining finance to fund their working capital requirements,” Massimo Falcioni, chief executive of ECI, said. “In collaboration with leading banks and financial institutions in the country, it will help SMEs through a wide range of financial and technological solutions to establish a strong SME sector and a resilient economy.”

The agreement is in line with ECI’s aim to support the UAE’s "Operation 300bn" industrial strategy that aims to raise the sector’s contribution to the country’s economic output to Dh300 billion ($81.6 million) from Dh133bn by 2031.

In addition to Emirates NBD, ECI is also teaming up with several other lenders in the country to encourage smooth collaboration between all parties in an end-to-end digitised process with standardised mechanisms for counterparties to monetise their receivables.

Supported by the UAE Ministry of Economy, the project effectively addresses the shortage or restricted availability of trade finance solutions for small enterprises, while simplifying cumbersome, confusing and time-consuming processes, ECI said.

“A receivables financing marketplace backed by ECI’s strong insurance coverage will help to strengthen the financial supply chain for UAE businesses and further boost the nation's position as a global trade hub,” Ahmed Al Qassim, group head for corporate and institutional banking at Emirates NBD, said.

“A strong financial supply chain network not only helps small enterprises in obtaining faster financing at competitive rates, it also benefits large corporates by meeting consumer demand and supporting sustainable business growth.”

ECI backs UAE manufacturers by facilitating access to trade finance, which boosts their exports, enhances their competitiveness in international markets and reduces the cost and timeline of obtaining funds.

The agency aims to support companies with Dh3.3bn in revolving credit guarantees, the equivalent of Dh10bn worth of non-oil trade, by the end of the year, Mr Falcioni told The National earlier this year.

In November, the government body signed a preliminary deal to provide more trade finance solutions to customers of Tradeling, an e-marketplace focused on business-to-business transactions.

Under the deal, ECI will provide Tradeling’s customers with solutions that will protect them against commercial and non-commercial risks arising from customers’ insolvency, protracted defaults and supply and political risks. The deal will also provide them with market intelligence and grant them access to international trade.