Abu Dhabi, UAE – The UAE banks provided AED 83.3 billion ($23 billion) in financial facilities to small and medium-sized enterprises in 2022, according to the latest data released by the Central Bank of the UAE (CBUAE).
Loans to SMEs accounted for 10.4 percent of the total accumulated balance of financial facilities for the trade and industrial sector which stood at AED 799.1 billion ($217 billion) by the end of December 2022.
According to Ministry of Economy, the SMEs sector represents more than 95 percent of the total number of companies operating in the country and provide jobs for more than 85 percent of the private sector’s workforce.
The Federal Tax Authority (FTA) is also introducing an initiative to boost tax compliance among small and medium enterprises.
Under what is called Muwafaq package initiative, the FTA is offering incentives and privileges to encourage tax compliance among SMEs, including access to tax accounting programmes and software at competitive prices, the FTA said in a statement on Thursday.
The FTA will also identify the challenges the sector may face and develop solutions to address them.
Developing the SMEs sector and accelerating the growth of the start-up ecosystem are priorities for the UAE government under its development strategy for the next 50 years.
The UAE Ministry of Economy has launched Entrepreneurial Nation 2.0, an updated programme to develop more than 8,000 SMEs and start-ups by 2030.
The first Entrepreneurial Nation initiative was set up in November 2021, with 10 programmes backed by digital tools and financing solutions, and about $5.5 million provided by private-sector partners.
The programme also has a goal of creating 20 unicorns, or start-ups with a valuation of $1 billion and above, by 2031.