How to Apply for a Business Loan in Dubai

If you’re starting a business or looking to expand in Dubai, a loan can be a great way to get the necessary funding.

Getting investment can be tough, especially for new businesses. But if you want to keep things running and grow your business, securing a loan is important.

Dubai is an attractive destination for small and medium-sized businesses. It offers flexible economic policies, tax exemptions, and great infrastructure.

UAE banks have given nearly AED 93.4 billion in loans to businesses, making it a great choice for entrepreneurs. They offer loans in the range of AED 50,000 and AED 5 million, depending on the applicant’s financial profile.

The repayment time is normally 2-5 years, with interest rates of 15%-25% per year. The interest rate depends on credit history, monthly income, number of active loans, loan amount, etc. The lender must have a current account in one of the UAE banks as evidence.

Business Loan Types in Dubai

• Standard Loan
  • It is given on certain conditions, including monthly repayments. Loan amounts can be negotiated with interest rates.
• Small Business Association (SBA) Backed Loan
  • SBA supports small businesses in getting funding for loans. It is government-backed, so there is low risk involved.
• Islamic Loan
  • This business loan is interest-free and you will be required to share your profits with the bank.
• Credit Card
  • It is given via credit card funds. However, it comes with heft interest rates.

Loan Application Eligibility Criteria

• Applicant must be at least 21 years old.
• Business must be operating for a year at least.
• Business must have a corporate bank account.
• Bank statements for the last 6-12 months.
• Yearly revenue must be at least AED 1 million to be eligible for a loan. However, this varies from bank to bank.
• If your business is a subsidiary or a branch of a foreign company, it might be easier to get a loan.

Documents Required

• Trade License.
• Bank application.
• Loan applicant’s passport copy.
• Bank statement (last 6-12 months).
• Copy or original of Articles of Association
• Copy or original of Power of Attorney
• Copy or original of Memorandum of Association.
• Tenancy agreement.
• Audit reports.
• Ministry of Labor issued employees’ list.
• Original or copy of Emirates ID.
• Original or copy of commercial lease papers (if asked).
• Original and copy of value-added tax (VAT) certificate.
• Lading bill (if asked).

How to Improve Chances of Getting a Business Loan in Dubai

• Ensure that your credit score is above 750.
• All dues such as loans, credit card bills, or any other debts are settled on time.
• You’re not applying for loans at multiple banks or financial institutes.