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Features and specifics of obtaining an investment loan in UAE

Article image: Features and specifics of obtaining an investment loan in UAE

When the company need to advance the quality of its products and to enter a new level of development, but its own financial resources are not sufficient, the best solution is obtaining an investment loan. It allows business to solve numerous important tasks, such as:

  • the introduction of new technologies;
  • purchase of equipment;
  • reconstruction or renovations to the premises: industrial, office, etc.;
  • construction or purchase of commercial property;
  • modernization of the company management model;
  • other requirements regarding the expansion and development of the business.

In fact, an investment loan is a special purpose loan provided for a long period of time for a certain enterprise development program. The Bank acts as an investor, which means it assumes the major risks arising in the process of implementing the investment project. That is why the financial institutions, which provide such loans, impose strict requirements to the borrowers.

Obtaining an investment loan in UAE: features

In the United Arab Emirates, an investment lending is available to manufacturing and trading companies, as well as to small and medium size businesses. The main requirement of the UAE banks is that the age of enterprise should be not less than 3 years. If the company is young, you need to provide information on the other business owned by you, for example, on the parent company: its incorporation documents, balance sheet, and statement of a corporate bank account.

Obtaining a loan for business purposes in the banks of the United Arab Emirates also requires:

  • Availability of a business plan;
  • Ability to provide collaterals and warranties;
  • Balance sheet of the enterprise and its financial performance over the last 2-3 years;
  • Confirmation of ability of timely loan repayment: additional financial reserves, a preliminary contract for selling finished products, etc.;
  • For newly established companies in the UAE: balance sheet of the parent or other company owned by the project owner.

Investment loan in the UAE can be obtained via providing as the security the equipment, real estate, etc. Credit terms are determined depending on the size of the collateral as well as on the financial performances of the company.

In addition to the abovementioned requirements, the UAE banks may also require additional documents such insurance of the items being purchased under the loan. Credit terms may also vary depending on the structure and type of a project. That is why you check all the details regarding obtaining a loan at a particular bank in advance.

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