DUBAI, October 31, 2021 (WAM) – As a significant impetus for the economic development of the United Arab Emirates, Etihad Credit Insurance (ECI), the federal export credit company of the United Arab Emirates, has signed a memorandum agreement with First Abu Dhabi Bank (FAB) and Crediti Fintech for the implementation of the âUAE Trade Finance Gatewayâ.
The availability of finance is essential for a healthy trading system. According to the World Trade Organization (WTO) report âTrade Finance and SMEs,â up to 80 percent of world trade is supported by some kind of finance or credit insurance. However, according to the report, there are significant gaps in the offering and as a result, many companies cannot access the financial tools they need. Without adequate trade finance, opportunities for growth and development are missed, the WTO said. Businesses are deprived of the fuel they need to do business and grow. Small and medium-sized enterprises (SMEs) face the greatest barriers to accessing finance on affordable terms. This is of particular concern, the WTO report continues, as SMEs are one of the main engines of trade, employment and economic development.
The âTrade Finance Gatewayâ platform aims to facilitate the access of UAE exporters and re-exporters to finance, as well as to support the growth of SMEs, thus enabling them to contribute to the UAE industrial strategy â Operation 300 billion â.
Supported by the Ministry of the Economy, as an example of a public-private partnership approach, the project aims to position ECI as the main gateway for exporters and re-exporters to commercial and financial credit solutions that will be provided by commercial banks and financial institutions, through which the Monimove fintech platform is the backbone of the technology. FAB is the first commercial bank to join this initiative and other commercial banks are expected to follow, confirming the strength of the UAE banking system, able to meet the core financial needs of businesses.
Commenting on this, Massimo Falcioni, CEO of ECI, said that the âPrime Minister and Ruler of Dubai will increase our domestic exports by 50% in the coming years.
The project will address a number of challenges that exporters and re-exporters face in obtaining finance to finance their working capital needs, such as the limited availability of finance for small businesses, the cumbersome and confusing process for obtaining funding, inability of customers to better understand – product or solution fit, lack of infrastructure to run digitized documentation, and long and tedious process.
It will also address the challenges facing SMEs and the dearth of trade finance solutions through financial and technological solutions to build a strong SME sector and a resilient economy. Through this partnership, exporters and re-exporters will benefit from transparent and rapid access to financing solutions bringing together the insurer, banks and exporters on a unified platform. ECI insurance coverage will enable exporting SMEs to obtain FOB secured loans by leveraging the cutting edge technology of the MoniMove platform. SMEs will benefit from an end-to-end digitized process encouraging smooth collaboration between all parties and accelerating access to finance products.
Shireesh Bhide, Head of Corporate, Commercial and International Banking Services at FAB, said: âFAB has long served as a gateway for trade and investment flows between the UAE and international markets, providing trade finance. to some of the country’s largest exporters. Innovative partnership with ECI and Crediti Fintech, we will be able to extend our expertise to a growing range of UAE companies, providing vital support to exporters of all sizes. growth potential of the country’s SMEs, start-ups and entrepreneurs, and support the UAE’s strategy for a sustainable and diverse future economy. “
In addition, the UAE Trade Finance Gateway will strengthen the ability of exporters to do business globally and assist them in various aspects, such as accessing new cross-border markets, liquidation protection counterparties, cash flow support, concentration risk reduction, as well as local facilitation and global bank financing and portfolio monitoring.