To start a business in Dubai, it is not enough to get all your financial support from one source. Sometimes, there are several choices that exist in the market that are easier to raise your start-up capital. The first and best option that comes in our mind is to get a business loan in Dubai that can give your business a path towards success. These needs differ from business to business and range from buying assets and inventory to paying employees to lease a shop or factory or arranging funds to meet working capital needs. Here are we mentioned a quite few things that will help you to get a business loan for your business in Dubai.
Getting an appropriate business loan can support you to survive in an economy where is one fight after another to stay ahead. By taking benefit of these fast company loans in Dubai, a company can use the money to fulfill the financial requirements related to the regular task of the company like paying employees’ salaries, purchasing equipment, and inventory, for marketing purposes, etc. Which will present the development of the company. Having quick access to company loans in Dubai can empower you financially and will permit your company to continue and expand its worldly operations.
What are the Eligibility Criteria to Get a Business Loan in Dubai
The very vital thing you have to contemplate prior to approaching a bank for getting the loan is the eligibility criteria offered by the concerned bank.
The following are the common criteria that all the banks consider.
The business must be in operation for at least one year
If your association is a branch or subsidiary of any offshore company then obtaining a loan would be considered to be easy.
An annual turnover of AED 1 million at least is needed to obtain a loan.
The banks of UAE offer different categories of the loan of business. The period for a business loan is 1 to 4 years.
Documents Required to Get a Business Loan in Dubai
The necessary documents that you need to prepare to get business or company loans in Dubai are mentioned below:
Bank statements for the last 12 months
Memorandum of Association Board Resolution or a Share certificate
Passport and visa of all the partners
Emirates ID
Office EJARI
Owners home residence tenancy contract or sharing accommodation later
High volume transaction invoices
VAT certificate
Audit report
List of employees obtained from Ministry of Labor
Landing bill
Trade license
Common Grounds for Rejection of Business Loan in Dubai
Low Credit Score
The very common reason for loan rejection is a low credit score. Banks check the business owner’s personal credit score in the procedure of evaluating applications for business or company loans in Dubai. A personal credit score is a vital aspect to check loan applications for startups or small businesses.
The reason for this move is simply as banks are concerned regarding the management of money by the business owners. If the owner is not able to handle its personal credit score how can the bank trust them to repay the loan.
Low Business Performance
If a business is conducting in low revenue and the cash flow position shows that there is no fund for day-to-day operation then the banks assume that the business isn’t in a position to repay the loans. Cash flow obstacles in the business persist but if the business conducts on these lines of low cash flow, then the bank won’t sanction your loan application.
Too Much Debt
While the applicant applies for a business loan, the bank considers monthly loan responsibilities. In case the bank figures out that you can’t pay the monthly installments then simply the business loan would not be sanctioned. Bank considers the credit usance for sanctioning a business loan application. Banks provide a suggestion that applicants cannot utilize over 30% of the available credit.
Insufficient Collateral
Collateral is referred to as a business property like investment, retained income, property, vehicles, and another concerned asset. Banks need collateral protection to issue a business loan. In case the collateral is not sufficient then there are chances that your business loan application may be rejected by the bank.
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