Hisham Al Shirawi said that financial institutions should allocate funds to set up support networks for entrepreneurs
The banking sector in Dubai should do more to support entrepreneurs and SMEs by establishing budgets for SME ‘support systems’, according to Hisham Al Shirawi, the chairman of the Dubai Startup Hub Advisory Committee.
Speaking at the Global Business Forum Latin America 2019 in Panama City, Al Shirawi said that “the entire ecosystem” of support for SMEs and entrepreneurs needs to be in place.
In the case of Dubai, he said the government first needed to take easily implemented steps.
“[Earlier] SMEs didn’t have a category to register their businesses,” he said. “That is something very simple that could be remedied easily. The country has done a lot to address these concerns.”
However, he said “a lot more” could be done by the financial sector.
“Unfortunately, the banking sector wants to treat loans to start-ups as personal loans and not SMES business loans,” he said. “An SME business loan would have different criteria, there would have to be a longer grace period, with certain reports that are required to be generated.”
To offer support for SMEs, Al Shirawi said he believes that financial institutions should allocate funds to provide a support network for SMEs as part of corporate social responsibility initiatives.
“Some of their budgets are wasted by the banks. They could be channelled to these start-ups with a certain SME support system, with people can can guide these young people on how to maintain their books, how to manage their capital and take their businesses to a more professional level.”
“Investing in start-ups is investing in the future,” he added. “These young people, if they don’t have proper opportunities to start their own businesses or get jobs in government or the private sector, will be a social ‘bomb’.”For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.