What have been the main achievements for your company over the past year?

MARWAN AHMAD ESSA AL THANI Al Salam Investment is focusing on the SME segment in two areas: the advisory business and private equity. What we discovered in Dubai is that we have a number of SMEs, but there is a lack of understanding about these entities. This means a lot of SMEs require advisory services to improve their visibility and to guide them in a new direction. We set ourselves up to be in the advisory business, and we communicate with a range of companies, as well as the government. My focus is on the GCC countries for many reasons. Firstly, there is still a gap in this market in terms of SMEs at the moment. There are both large and small companies, with a huge gap in SME businesses meaning there is a lot of potential. Also, the government understands the importance of the SME sector and we are focused in the same direction. I think the country needs to focus on the SME sector over the next five to 10 years.

DAVID HUNT It has been an interesting year for GFC where we have continued to see strong demand for our lending products. This demand is driven by a dynamic and fast developing SME sector in the Emirates, and the need for small businesses to obtain quick and easy access to funding in order to expand their businesses. With a 15-year track record of having served the countries’ SMEs, we have over the past year also expanded our lending capabilities to cater to companies that can be found in the micro business space. Micro-businesses, for example businesses that typically employ less than 10 people and have an annual turnover of up to AED10 million, have historically been underserved when it comes to funding as many conventional banks view these businesses as being too small, however we see lending in this space as an opportunity and plan to focus on servicing the micro business segment going forward.

How does your firm support SMEs, and how do they contribute to the broader economy?

MAEAT We can help Dubai through private equity investment focusing on SMEs. Another tool there is Islamic finance for the government and development, and there are major investors and bankers involved. From our perspective, we are focused on the SME sector and private equity, and we think this is Islamic and fundamental, because if we have this concept for any fund, investors will want it. However, because they do not have any source on the ground to feed them information and knowledge, they do not have the tools to invest, even though they have the money. They need the channels to make the right investments. In 2015, we expect a major rise in the SME sector; we expect to see growth of up to 40%. We also expect a huge jump this year because what the market needs has been achieved to the required level, and we only need to give a little push to reach our target.

DH One of the key constraints on the part of SMEs to obtain financing has been their inability to provide adequate financial information and accurate historical data, information that is needed in order to be able to make a credit decision. Because of this, lenders do not perceive these companies to be ‘bankable’. Many small business owners therefore look to finance their businesses themselves or tend to rely on family and friends for initial investments. At GFC, we offer help and support in developing for instance a good business model or a suitable financial plan and aim to act as partners to our clients. Over the past few years we have seen an increasing number of banks enter the debt finance segment. Given that access to funding has traditionally been one of the main obstacles to obtaining growth capital for SMEs, this is an encouraging indication even if it means that the market for lenders is becoming more competitive. Today many local banks offer SME loans, however since Gulf Finance is not a bank but a finance company, we are slightly different in the way that we operate in that we are able to offer our customers a broader variety of more flexible products which we tailor to suit each client’s individual needs.