Dubai is one of the world’s most progressive cities when it comes to providing startups and SMEs with alternative financing options. According to a recent report by the Dubai Economic Council, strengthening the financial position of the United Arab Emirates’ small businesses will be key in driving Dubai to a position of a global financial hotspot.
But with the disappearance of several major banks from the country, Dubai businesses are sometimes struggling to access working capital. The city’s government revealed Saturday (April 18) a new way to provide financial support to its businesses.
The government revealed a new collaboration with Citi to introduce a new supply chain finance mechanism to government suppliers, the majority of which are SMEs. The solution is part of a tool developed in conjunction with U.K. payment processing firm Invapay.
Citi will also launch its Visa-backed Citi Corporate Purchasing Card product in conjunction with the estimated 9,000 suppliers expected to participate in the program. Businesses will gain access to a customized platform to meet the needs of both government procurement officials and the suppliers with which they work.
The program, according to city officials, is beneficial not only to local small businesses, but for the nation’s economy as a whole. “Suppliers are an extension of our business, while building the ecosystem for the private sector is a major focus for us,” said the Deputy Director General for Economic Affairs Khalid Al Kassim, who is also the Director of Dubai Competitiveness Office. “Therefore, this pioneering initiative by the Dubai Competitive Office falls within our efforts to enhance UAE’s and Dubai’s competitiveness metrics such as government transactional efficiency, level of support for the SMEs, and perpetuity of supplier cash flow.”
Another official, Jamal Hamed Al Marri, who serves as the Department of Finance’s Executive Director of Central Accounts, said that the partnership will “transform” how suppliers get paid and in how small businesses access financing. “We perceive this project as a vital driving force behind the economic development of the emirate,” he added.
According to reports, the Citi p-card and supply chain finance services are part of the company’s Citi for Cities global initiative to work with various city governments to support the modernization of infrastructure and support local economic growth.