Dubai to develop Shariah-compliant trade finance platform for SMEs
The Dubai Multi Commodities Centre (DMCC) and Dubai SME are partnering to develop a Shariah-compliant web-based trade finance platform for small and medium enterprises (SMEs) to pledge their assets for lending purposes, DMCC said in a media statement.
The platform will operate under the DMCC Authority regulatory framework.
''This cooperation between DMCC and Dubai SME opens a new avenue for funding and financing SMEs. We are all aware that SMEs have had a challenge securing financing to grow their businesses, this cooperation will be valuable to all SMEs based in Dubai," said DMCC CEO Gautam Sashittal.
According to the media statement, DMCC is working with Dubai-based Islamic consultancy firm Alternative International Management Services (AIMS) to make the platform Shariah-compliant.
DMCC and Dubai SME did not say when the platform will be completed.
DMCC has been operating a Shariah-compliant commodity trading platform since 2013. The murabaha trading platform allows the trading of warehouse receipts that represent ownership of commodities stored at warehouses. It was followed in 2016 by a salam platform for forward-financing of transactions.
DMCC is a free zone for trade and enterprises and is home to over 14,100 companies, around 80 percent of which are SMEs, it said.
Dubai SME is a division of the Dubai government’s Department of Economic Development.
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