Small Business Loan In UAE Without Bank Statement

Do you have a small business in UAE without bank statement and are wondering if it is possible to get a loan? Are you looking for a lender that can give you a small business loan in UAE without bank statement? Carefully go through this article to find out the possibilities and the other essentials you need to know concerning getting a business loan.

Obtaining a small business loan without providing bank statements can be challenging, as financial institutions typically require these documents to assess your business’s financial health and creditworthiness. Most financial institutions usually demand your bank statement, either yours (personal) or your business for 6 to 12 months.

However, there are alternative financing options you may explore. Continue reading to know and learn about them. 

Small Business Loan In UAE Without Bank Statement

Here are some of the options you can explore when you a seeking to get a small business loan in UAE without a bank statement: They are as follows:

• Muhammed Bin Rashid Fund
• Khalifa Fund for Enterprise Development
• Peer-to-peer lending:
• Online lenders
• Angel investors or venture capitalists:
• Government grants and programs
• Family and friends:

1. Mohammed Bin Rashid Fund

This is one of the best platforms to access a small business loan in UAE without bank statement. The Muhammed Bin Rashid Fund was established to fund SMEs to encourage creativity and innovation.

They offer several funding options to SMEs, including Bank Guarantee loans. To access the funds, you need a copy of the family book, a resume, a passport, an executive summary or action plan model, and an established program model.

2. Khalifa Fund for Enterprise Development

To be eligible for a small business loan in UAW without bank statement at Khalifa, you must be a member of the association first. To join, you will be required to pay a fee. For a license less than 2 years, the fee is 500 AED and 2000 AED for those above 2 years. 

To access a loan as a small or medium business enterprise, you must present some stated documents to prove your eligibility. They include a trade license, passport photos, emirates ID, Introductory statement, family book, passport, reservation certificates, and trade name.

3. Online lenders

Some online lenders specialize in providing small business loans with a streamlined application process. They are more flexible in their requirements and can give you a business loan without bank statement. Examples include Kabbage, OnDeck, and BlueVine.

4. Angel investors or venture capitalists

If you’re open to giving up equity in your business, consider seeking funding from angel investors or venture capitalists. They may be less concerned with traditional documentation and more interested in your business idea and potential for growth.

5. Government grants and programs

You can get a small business loan in UAE without bank statement via government grants and programs. Check if there are any government-backed programs or grants for small businesses in the UAE.  Normally, these programs have less stringent requirements compared to traditional banks.

6. Peer–to–peer platforms 

P2P platforms connect business owners to individual lenders as they are more flexible with less stringent requirements than traditional banks. The disadvantage is that the interest rate and fee might be high. Examples include Prosper, Funding Circle, and Beehive in the UAE.

7. Family and friends

While not a formal loan option, seeking financial support from family or friends might be an option with fewer formalities. Borrowing from friends and family is the less expensive way to get a business loan in UAE without bank statement. However, it’s crucial to formalize any such agreements to avoid misunderstandings.

Startup Business Loan In UAE

Obtaining a startup business loan in the UAE involves a thorough application process, and the specific requirements can vary depending on the lender. You must understand the processes involved and get all the required documents before you go ahead in applying for the loans.

Here, in this section, you will understand the processes involved, the eligibility criteria, and the best lenders that provide Startup business loans in UAE.

The Processes Involved:

The first thing you have to do when obtaining a startup business loan in UAE is to develop a comprehensive business plan that outlines your business idea, target market, competition, revenue model, and financial projections. Lenders often require a detailed business plan to assess the viability of your startup.

The next is to ensure that your business has a legal structure and is registered with the relevant authorities in the UAE. You might be required to submit proof of legal registration. While startup loans may not heavily rely on your business’s credit history, your personal credit history may still be a factor.

Some lenders may require collateral to secure the loan. This could be business assets, personal assets, or a personal guarantee. Ensure you understand the collateral requirements of the lender before you agree to the agreement.

Preparing your legal and financial documents is one of the most essential processes you must not skip. Get all the documents like proof of registration, articles of association, memorandum of association, income statements, balance sheets, and cash flow projections. Lenders will want to assess your financial stability and the potential for your

Eligibility Criteria:

Although the eligibility criteria differ amongst lenders. Here are the general requirements you must meet:

• You are generally required to be within a specific age range, typically between 21 and 65 years old
• You must be a resident of the UAE with a valid residency visa
• Your business must be operating for at least two years, with an annual sales turnover of AED 2,000,000 or more.

Top Lenders of a Startup Business Loan In UAE

Here are some of the best financial institutions that offer startup business loans in UAE

1. Emirates Development Bank (EDB)

EDB is a government-backed institution that offers various financing programs to support SMEs and startups in the UAE. To be eligible for a startup business loan, your business must be at least 51% owned and managed by UAE nationals. EDB offers startup financing that ranges from 300,000 to AED 2 Million for a loan term of 6 months to 3 years.

2. Dubai SME

Dubai SME, an agency of the Department of Economic Development in Dubai, provides support and financing options for small and medium enterprises, including startups. Go to their official sites and check if your business idea is eligible for their financing options.

3. Abu Dhabi Investment Office (ADIO)

ADIO offers a range of incentive programs and financial support to businesses, including startups, looking to establish or expand their presence in Abu Dhabi. As a startup business, you can get a loan at ADIO from their various joint venture capital programs.

Also, the Abu Dhabi Investment Office (ADIO) launched a $145.6 million Ghadan Ventures Fund to boost the startup and provide capital to commence business.

4. Commercial Bank of Dubai (CBD)

CBD provides several business banking services, including loans and financing options for startups and small businesses. You must meet their requirements before being considered, as they might be a bit stringent.

5. National Bank of Abu Dhabi (NBAD)

First Abu Dhabi Bank (FAB), NBAD, historically has been known as one of the best financial institutions to get a startup business loan in UAE. A few months ago, Abu Dhabi’s Hub71 revamped its Incentive Programme to provide startups with capital funds up to AED750,000 in cash and in-kind. This is the best time to key into this program.

Also, as a startup business, you can benefit from government grants and business programs. Additionally, you can get capital funding from venture capitalists, angel investors, and crowdfunding platforms.

Documents Required For Business Loan In UAE

When applying for a business loan in the UAE, the specific documentation requirements can vary depending on the lender and the type of loan you want. Here is a general list of documents commonly requested by financial institutions:

1. Business Plan: A detailed business plan outlining your business model, market analysis, financial projections, and plans for utilizing the loan.
2. Company Registration Documents: Proof of legal business registration, including trade license, memorandum of association, and articles of association.
3. Emirates ID and Passport Copies: Copies of Emirates ID and passports of the business owners or partners.
4. Financial Statements: Financial documents, including audited or unaudited financial statements, profit and loss statements, and balance sheets.
5. Bank Statements: Bank statements for both personal and business accounts, typically covering the last six months.
6. Proof of Ownership: Documents confirming ownership of business assets, properties, or any collateral being offered.
7. Credit Report: A personal and/or business credit report to assess the creditworthiness of the business and its owners.
8. Legal Documents: Copies of contracts, agreements, or any legal documents relevant to the business operations.
9. Collateral Documents: If the loan requires collateral, provide documents related to the collateral, such as property deeds or asset appraisals.
10. Business License Renewal Certificate: A valid and up-to-date business license renewal certificate.
11. VAT Registration Certificate: If applicable, provide the Value Added Tax (VAT) registration certificate.
12. Utility Bills: Recent utility bills for the business premises as proof of address.

How To Get Business Loan In UAE     

Getting a business loan in the UAE involves a systematic process. It is not something you rush. Here’s a step-by-step guide to help you navigate through the application process:

1. Understand Your Needs

Clearly define the purpose of the loan. Whether it’s for working capital, expansion, equipment purchase, or any other specific business need, having a clear understanding will help you determine the loan amount and terms.

2. Determine the Loan Type

There are three loan types in Dubai, and each has its peculiarities. They are as follows:

• The Standard Loan: Standard business loans refer to loans subject to certain conditions. The loan amounts and interest rates are negotiable, and repayments are made in fixed monthly installments. It usually has fixed and variable interest rates. 
• The Islamic Loan: Islamic finance is the financing that operates on Sharia law. A business loan gotten from the Islamic loan platform is interest-free, but your company will give the bank a portion of its profits instead of interest on the loan. If you want to do business in Dubai and achieve moral and ethical dimensions, this type of loan is the best for you.
• Small Business Association Backed Loan (SBA): If you have applied for several business loans and your request has all been rejected. This is a good loan option to consider. This is because the UAE government solely backs it up.

3. Evaluate Your Eligibility

Different lenders have varying eligibility criteria, and this goes for the different loan types. Check the requirements of potential lenders to ensure that your business meets their criteria regarding business type, years in operation, revenue, and other relevant factors.

4. Check Your Credit Score

Your personal and business credit history will be assessed by lenders. Ensure your credit score is in good standing. If there are issues, resolve them before applying for a loan.

5. Prepare a Comprehensive Business Plan

Create a detailed business plan that outlines your business, its mission, goals, financial projections, and how you plan to use the loan. A well-thought-out business plan is crucial for convincing lenders of your business’s viability.

6. Gather Necessary Documents

Collect all the required documentation, including business registration documents, financial statements, bank statements, proof of ownership, and any other documents specified by the lender.

7.  Research Lenders

Identify potential lenders that offer business loans in the UAE. This could include traditional banks, online lenders, government-backed programs, or specific financial institutions catering to small businesses.

8. Initiate Contact with Lenders

Contact the selected lenders to inquire about their loan products, application process, and requirements. Many lenders provide information online or through dedicated business relationship managers.

9. Submit Loan Application:

Complete the loan application form provided by the lender. Ensure that you provide accurate and complete information. Attach all required documents to support your application.

10. Attend Meetings or Interviews

Some lenders may request a meeting or interview to discuss your business and loan requirements further. Be prepared to answer questions about your business plan and financials.

11. Wait for Approval

After submitting your application, patiently await the lender’s decision. This process can take time as they review your application, conduct credit checks, and assess the risk.

12.  Review Loan Terms

If your loan is approved, carefully review the terms and conditions before accepting. Understand the interest rate, repayment schedule, fees, and other essential details.

13. Complete Legal Formalities

Fulfill any legal requirements, such as signing loan agreements and providing necessary collateral if applicable.

14. Receive Funds

Once all formalities are completed, the approved funds will be disbursed to your business account.

Who Is Eligible For Business Loan In UAE?

The eligibility criteria for a business loan in UAE differ. Here are the general requirements to fulfill:

• Your business must be valid and functional for at least a year.
• You must have a business account in one of the banks in the UAE.
• You must not be less than 21 years old.
• Your business must have an annual turnover of at least AED 1 million
• It is easier to obtain a business loan if your business is a branch or subsidiary of an offshore operational company

How Can I Get an Instant Cash Loan In UAE?

Getting an instant cash loan in the UAE typically involves applying through online platforms or mobile apps that offer quick and convenient loan processing. One of the best fintech apps where you can get instant cash loans in UAE is Cindy. Credy offers a wide range of loan options, such as business loans, personal loans, credit card financing, and business loans. Application is fast, and you can get funded hours after approval.

Cash App is a well-known instant cash loan provider in the UAE. The application process is straightforward, and the disbursement turnaround is fast. Its repayment schedule is flexible and allows you to repay your loan on time. Another app you can try out when looking for an instant cash loan in UAE is IOU. IOU uses advanced technology to check the eligibility of the applicants, which helps ensure a fast application process.

Lastly, NowMoney allows low-skilled in the UAE to borrow up to AED 2000 and get the money transferred directly to their account within 24 hours of approval.

Is It Easy To Get A Business Loan In UAE?

It can be easy to get a business loan in UAE if your business is an established one with a solid financial track record and a clear repayment plan.  Established businesses with a proven track record of financial stability and profitability are generally viewed more favorably by lenders. Startups or businesses with inconsistent financial performance may find it more challenging to secure a loan.

Also, both personal and business credit histories are crucial factors for lenders. A good credit score enhances your eligibility and may result in more favorable loan terms. Additionally, offering collateral, such as business assets or personal assets, can improve your chances of getting approved for a loan. This makes it easier to access secured business loans than the unsecured ones.

How Much Money Required To Start A Small Business In UAE?

The amount of money required to start a small business in the UAE varies widely depending on the nature of the business, the industry, and the specific location in the UAE. Here are some general considerations and estimated ranges for starting different types of small businesses in the UAE:

Service-Based Businesses

• Low-Range Estimate: AED 50,000 to AED 100,000
• High-Range Estimate: AED 200,000 to AED 500,000
• Examples: Consultancy services, freelance services, tutoring, etc.

Retail Businesses

• Low-Range Estimate: AED 100,000 to AED 200,000
• High-Range Estimate: AED 300,000 to AED 1 million
• Examples: Small retail shops, online stores, boutique stores, etc.

Food and Beverage Businesses:

• Low-Range Estimate: AED 150,000 to AED 300,000
• High-Range Estimate: AED 500,000 to AED 1.5 million
• Examples: Cafes, small restaurants, food trucks, etc.

Consultancy and Professional Services

• Low-Range Estimate: AED 50,000 to AED 100,000
• High-Range Estimate: AED 200,000 to AED 500,000
• Examples: Legal firms, accounting firms, marketing agencies, etc.

Technology and E-commerce Businesses:

• Low-Range Estimate: AED 100,000 to AED 200,000
• High-Range Estimate: AED 300,000 to AED 1 million
• Examples: Software development, online retail, tech services, etc.

These estimates are general and intended to provide a rough idea. The actual cost can vary based on factors such as the location, size of the business, rental costs, licensing fees, marketing expenses, and the need for specialized equipment.

What Is Documentation Required For A Business Loan In UAE?

The documentation required for a business loan in the UAE differs depending on the lender, the type of loan, and the specific circumstances of your business. Here is a general list of documents commonly requested by lenders when applying for a business loan:

1. Business Plan: A comprehensive business plan that outlines your business model, mission, goals, market analysis, and financial projections.
2. Company Registration Documents: Trade license, Memorandum of Association (MOA), and Articles of Association (AOA).
3. Financial Statements: Audited or unaudited financial statements, including income statements, balance sheets, and cash flow statements for the last 2-3 years.
4. Bank Statements: Recent bank statements for business and personal accounts, typically covering the last 6 months.
5. Tax and VAT Registration Certificate: A copy of your tax and VAT registration certificate (if applicable).
6. Ownership and ID Documents: Copies of passports and Emirates IDs for all business owners, partners, and key stakeholders.
7. Legal Agreements: Copies of contracts, agreements, or any legal documents relevant to the business operations.
8. Management Profiles: Resumes or profiles of key management personnel, highlighting relevant experience and qualifications.
9. Business License Renewal Certificate: A valid business license renewal certificate.

Can I Get A Loan Without A Job In UAE?

Yes, you can get a loan without a job in UAE, but it can be difficult, as lenders typically require proof of income and employment stability to assess your ability to repay the loan.

If you do not have a job and want a loan, the best type is a secured loan, where you provide collateral such as property, valuable assets, or investments. Lenders may be more willing to provide a loan if there is a valuable asset securing it. You can also get a co-signer or guarantor with a stable income and good credit history to apply for guaranteed-based loans.

Peer-to-peer lending platforms can also be helpful as they connect borrowers with individual lenders. While income requirements may still apply, these platforms may have more flexible criteria than traditional banks. Lastly, you can explore government-backed programs or initiatives that support entrepreneurship or provide financial assistance to individuals in specific situations.

Can I Apply For A Loan In UAE?

You can only apply for a loan in UAE if you are a resident with a valid means of identification and up to 21 years of age. Also, you must have a current account with any legitimate bank in UAE, and your monthly salary must be between AED 3,000 and AED 10,000.

Conclusion

Obtaining a small business loan in the UAE without bank statements can be a feasible option for entrepreneurs seeking alternative financing solutions. While traditional banks may require extensive documentation, and it might not be possible with them, emerging financial technologies and specialized lenders are here to cater to the evolving needs of small businesses. By exploring these alternative options, business owners can find accessible funding options to accelerate the growth of their businesses.