30 Aug 2022
SMEs account for 95% of businesses worldwide, making them the essential engines for the survival of the global economy. Yet, they have historically been overlooked and underserved by many banks.
For startups, or newly-established businesses, the struggle in tapping banks to get more funding to sustain their operations or widen their operations is even greater.
Thankfully, this is not the case in the UAE which ranked first this year in the Global Entrepreneurship Monitor’s Index 2022, the top global reference in entrepreneurship for countries and international organisations like World Bank, International Monetary Fund, Organisation for Economic Cooperation and Development (OECD), World Intellectual Property Organisation (WIPO) and the United Nations.
The country has also emerged as the number one global destination for establishing and starting businesses in the same Index. SMEs represent more than 94% of companies operating across the UAE’s seven Emirates, providing jobs to more than 86% in the private sector, according to government data. In Dubai, SMEs make up 95% of the businesses, 42 percent of private sector jobs, and contribute to 40 percent of the emirate's gross domestic product (GDP).
And behind the success of SMEs in the UAE are banks and their special solutions. You might think setting up a business account is hard. But in fact, the UAE Banks Federation has even launched a nationwide SME Campaign to support their banking and financial planning needs.
So, let’s get started on how you can open your business bank account whether your company is listed offshore or onshore, or licensed in any of the free zones, a registered branch or a subsidiary company in the UAE.
There are about 24 local and more than 30 foreign banks in the UAE with branches across the seven Emirates—Abu Dhabi, Dubai, Sharjah, Fujairah, Ras Al Khaimah, Umm Al Quwain and Ajman. All of these banks would be happy to serve your banking needs.
These banks have different requirements in opening a business bank account but generally all of them may require the following documents to process your application:
Banks typically require a maintaining balance on a business account but some banks like the Commercial Bank of Dubai (CBD) and RAK Bank, which has ties with the top telecom firm in the UAE, etisalat by e&, offer special banking solutions for startups and entrepreneurs which do not require a maintaining balance. But every transaction comes with nominal fees. This starter account is offered in AED, USD, GBP, EURO, JPY and CNY.
Business experts generally recommend getting a business bank account from any of the local banks due to their flexibility in offering special banking solutions applicable to small and medium businesses.
Setting up a business bank account has several advantages:
No company is too small for a business banking account. Give it a shot. But remember to choose well. A good bank can be your best friend as you grow your business.