Emirates Development Bank signed a memorandum of understanding with Commercial Bank of Dubai to provide credit guarantees and co-lending programs to small and medium-sized enterprises in priority sectors in the UAE.

“Through our combined efforts, we look forward to extending easier access to financial sources, strengthening the SME ecosystem and supporting the UAE’s goals to build a robust, knowledge-based economy,” Ahmed Mohamed Al Naqbi, chief executive of EDB, said.

As part of the agreement, EDB will provide a credit guarantee or co-lending program to CBD’s SME customers within certain sectors. It allows CBD to offer financing of up to Dh10 million to an SME, with 50 percent of this either guaranteed or co-lent by EDB, a statement from the lender said.

CBD will provide SMEs with a digital business account, which can be opened digitally and in real time. The lender will also offer a range of loans, including trade and working capital finance, loans against point of sale as well as asset-backed lending, the statement added.

The program also aims to offer financing facilities of up to Dh1m to Emirati entrepreneurs, whereby 60 per cent will be guaranteed or co-lent by EDB, the lender said.