Dubai Chamber of Commerce and Industry will head a new working group which will be tasked with engaging various public and private sector stakeholders and tackling a variety of banking challenges faced by SMEs, startups and entrepreneurs in Dubai. The announcement of the new working group was among the key recommendations outlined by industry experts who participated in a panel discussion recently held as part of Dubai Startup Hub’s Entrepreneurship Advocacy Series.
The event, hosted at Dubai Chamber’s premises, was attended by representatives of the UAE Ministry of Economy, leading UAE banks, heads of licensing authorities, local incubators, startups and SMEs. Dubai Startup Hub, an initiative of the Dubai Chamber of Commerce and Industry, is organising the Entrepreneurship Advocacy Series with the aim of fostering an open and constructive dialogue between various stakeholders, facilitating private-public sector cooperation, and developing practical solutions to existing challenges facing SMEs and startup.
During the event, panellists reviewed the findings of a recent study conducted by Dubai Chamber in coordination with the UAE Ministry of Economy, the UAE’s Council of Small and Medium-Sized Enterprises and global consultancy firm Roland Berger, and shared their insights on various issues, including access to finance and banking services, regulatory requirements, and the need for digital solutions.
The process of opening a bank account was highlighted as an area that needs improvement as panellists noted that it can take up to three months for SMEs and startups to set up a bank account. Required procedures were described as complicated and lengthy, while the need for better guidance from banks was noted. Regulatory pressures and strict standards were identified as the main factors that have limited progress in these areas, while other customer segments are often seen by industry players as more commercially attractive than SMEs and startups.
H.E. Sultan Bin Saeed Al Mansoori, UAE Minister of Economy said: “The Ministry of Economy and the SME Council support all creative and entrepreneurship initiatives such as the Dubai Startup Hub and its new Entrepreneurship Advocacy series and publications. The UAE continues to offer new outstanding opportunities for entrepreneurship and international partnerships in all economic sectors due to its highly attractive business environment. I encourage entrepreneurs and SMEs to explore cooperation with each other and focus on innovative projects and technology that serve the key economic sectors in the UAE innovation strategy.”
For his part, H.E. Hamad Buamim, President and CEO of Dubai Chamber noted that the Chamber is committed to ensuring a favourable business environment in Dubai that remains conducive to growth, and stressed the important role that SMEs and startups play in supporting the economy and fostering innovation. H.E. Buamim said the recent study on SME banking challenges conducted by the Chamber provides more clarity on existing obstacles and enhances transparency within the business community, adding that the Chamber will plan to conduct research on other important matters impacting SMEs and startups, and aim to identify tangible solutions that address such challenges.
Sharing his thoughts during the panel, Neil Petch, Chairman of UAE company formation specialist Virtuzone explained that opening a corporate bank account can be a challenging process for entrepreneurs in the UAE, which can often lead startups to look elsewhere to set up their businesses.
“We welcome the report’s call to make the account opening process ‘simple, transparent, and fast, while meeting compliance needs’. To maintain the UAE’s image as a country that is open for business, we also fully support the Dubai Chamber’s suggestion that banks publish a clear, readily available, step-by-step guide to provide transparency on the banking process, timing and documents required to open an account,” said Petch.
Sassan Hatam, Partner, Roland Berger and co-author of the study, recommended to explore options such as introducing a basic no-frills bank account, creating one-stop solutions for trade license and bank account, or digitalising the end-to-end account opening process. This could help the UAE become a showcase for global best practice when it comes to opening a startup bank account.
Established by Dubai Chamber in 2016, Dubai Startup Hub is the first initiative of its kind in the Middle East and North Africa region. The initiative aims to provide clarity and guidance for entrepreneurs throughout their journey, while it also leverages public-private sector partnerships to promote innovation and develop Dubai’s entrepreneurial ecosystem.
Dubai Startup Hub complements Dubai Chamber’s strategy to support entrepreneurs and foster a culture of innovation within the emirate’s business community. The Chamber also supports entrepreneurs through its Tejar Dubai programme, which aims to nurture young Emirati entrepreneurs by helping them take their first steps into the business world.