Emirates Development Bank (EDB) signed a new agreement with the National Bank of Umm Al Qaiwain to provide increased financial support to small and medium enterprises (SME) in priority sectors in the UAE.

As part of the deal, NBQ will offer up to Dh10 million (USD 2.72m) of financing to SMEs with 50% of this either guaranteed or co-lent by Emirates Development Bank.

“The UAE government has placed considerable emphasis on developing the SME ecosystem and boosting their contribution to the UAE’s non-oil GDP,” said Ahmed Al Naqbi, chief executive of Emirates Development Bank.

“Our agreement with NBQ will help us facilitate financing through credit guarantee and co-lending options to allow greater operational flexibility to SMEs.”

Emirates Development Bank was founded in the year 2011 after a merger between the Emirates Industrial Bank and the Real Estate bank. It targets to provide Dh30 billion in financing over the next 5 years to support the UAE's efforts to more than double the size of its industrial sector by year 2031. It will fund industries such as food security, healthcare, infrastructure and technology and help generate around 25,000 jobs.

"The NBQ understands the key role SMEs play in building the nation’s economy. That is why they have developed financial solutions to allow SMEs in the UAE to trade safely and confidently and gain access to international markets, thereby positioning the UAE as the global hub of trade and export,” said Adnan Al Awadhi, chief executive at NBQ.

The programme also targets to offer financing facilities of up to Dh1 milloin to Emirati entrepreneurs, whereby 60% will be guaranteed or co-lent by Emirates Development Bank, the lender said.

Emirates Development Bank also signed 2 separate agreements this month with RAK Bank and the Commercial Bank of Dubai to offer credit guarantees and participate in co-lending programmes to small and medium-sized enterprises in the UAE.