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Tue 24 Mar 2015 02:34 PM

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65,000 UAE firms currently using credit facilities - Al Etihad chief

Al Etihad Credit Bureau expands ops to scrutinise credit worthiness of companies operating in the UAE

65,000 UAE firms currently using credit facilities - Al Etihad chief
(Photo for illustrative purposes only)

Al Etihad Credit Bureau, the UAE’s credit reporting company, said on Tuesday it has launched the commercial bureau reporting service, which will provide full and up to date credit information on companies in the country.

Information contained in the commercial reports includes the company’s full address, details of its ownership, the credit facilities that are being used, the total amount of credit taken, and the company’s track-record of payments over the past two years.

The reports will allow the UAE’s companies to check the information held by banks is accurate – an important factor as a strong credit history will give access to better terms and conditions with banks, lenders and utility providers and will make it easier to gain access to capital, a statement said.

The move expands the role of the credit bureau which began covering retail customers last year.

The much-delayed bureau also has financial information on 2.8 million individuals or 97 percent of the total population with a credit history.

Authorities see the recently-opened Al Etihad Credit Bureau as a safeguard against a repeat of the credit bubble that undermined the economy at the end of the last decade.

The state-run bureau also collates bank data on people's credit histories, aiming to give lenders a better picture of whether borrowers are likely to be able to manage their debt.

Marwan Ahmad Lutfi, CEO of Al Etihad Credit Bureau, said: “As the UAE’s financial sector matures and increasingly positions itself as a competitor on the global financial stage, it is essential for the country’s banks, lenders and utility providers to have as much information at their fingertips as possible when making important commercial credit decisions – especially as the amount of credit in question can be substantial.

"Currently we can say that 65,000 of UAE-registered companies are using credit facilities, such as loans or overdrafts. This means that 16.25 percent UAE registered companies in the UAE are active in the lending market. Between them, they are using 308 thousand different types of credit contracts, including various loans, overdrafts and credit cards.”

With the launch of the commercial bureau, lenders will now have a clear picture on the financial obligations of individual companies and how well they are dealing with them – such as pinpointing if there have been any defaults or delinquent payments.

Lutfi added: “Just as the UAE’s commercial sector continues to evolve and grow, Al Etihad Credit Bureau is itself evolving alongside it to ensure the country remains competitive, strong and a magnet for business interests.”

Businesses will be able to request their credit reports through the Bureau’s customer service centres in Abu Dhabi and Dubai by visiting aecb.gov.ae or calling 600566662.

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