Challenges

"Access to Finance
New investment opportunity for investors
Key factors: Ease of process, Ease of access. Simplifies terms & conditions, receiving finance within minimal TAT."

Primary target

Which group does your product/service primarily target?

Description of Innovation

Dubai SME are involved in providing Fintech solutions to their MSME customers. Dubai SME partnered with Beehive, a Dubai-based fintech providing peer-to-peer lending, and created a unique model to provide government credit guarantee to encourage individual investors to finance SMEs according to their needs. The provided digitized products include business financing (term loans) and invoice financing (credit loans). Website: https://sme.ae/

Based in Dubai, Beehive is the first peer to peer (P2P) lending platform in MENA to be regulated by the DFSA. As a leading Fintech pioneer, we use innovative technology to directly connect businesses seeking fast, affordable finance with investors who can help fund their growth. Website: https://www.beehive.ae/

Under this scheme: Beehive offered finance is supported by a 50% or 100% Credit Guarantee from Mohamed Bin Rashid Fund (MBRF) to funded Businesses:

• (A) A business that is owned and managed 100% by an Emirati will receive a 100% guarantee & maximum finance amount of AED 1 MN
• (B) A business that is owned and managed 51% - 99% by an Emirati will receive a 50% guarantee & maximum finance amount of AED 500 K Beehive is a fintech solution provider that offers Term & Working Capital Finace via crowdfunding

Results

"Key factors: Ease of process, Ease of access. Simplifies terms & conditions, receiving finance within minimal TAT.
Portal is open for global investors. Investors can invest in UAE based SME’s.

Under this Credit Guarantee Scheme 13 Businesses are funded. Total Finance Amount is Aed 7.68 MN. 77% of principle amount is successfully repaid by SME borrowers, Only 23% priniciple loan amount is outstanding without any Delinquency. Default rate is 0%

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Lessons Learnt

Country intending to introduce / implement crowd funding platform need to ensure crowd funding official laws are incorporated in their constitution.

"Challenge is nonexistence of crowd funding under UAE Law at that time 2017.
Impact: Adding crowd funding as an official law is still under review with UAE regulators."