SMEs in the MEA

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Egypt: Key Financial/Business Needs

Key financial/business needs for small and medium enterprises in Egypt include access to credit services and export support.

Access to Credit Services

  • Access to credit is one of the key financial needs of small and medium enterprises in Egypt. Expert at the 20th annual Euromoney Conference in Egypt identified access to finance as a major obstacle to Egyptian enterprises' growth. This suggests a need for reorientation of lending strategies to make credit services accessible to SMEs in Egypt.
  • According to the Middle East Institute, a "lack of access to finance has long been recognized as a key obstacle" for small and medium enterprises. This is despite the actions taken by the government and lenders which have been ineffective.
  • According to Oxford Business Group, the financing gap for small and medium enterprises in developing countries such as Egypt is partly due to the difficulties that banks face in assessing the creditworthiness of these enterprises, "which can discourage lending to these firms".
  • According to a 2019 Euro-Mediterranean Network for Economic Studies (EMNES) survey, found only "3.4% of businesses started out with a business loan".
  • According to AFC, lending to small and medium enterprises is "underrepresented in total banking assets accounting for not more than 6% of all lending".
  • The World Bank Enterprise Survey shows that Egypt's value of collateral for small and medium enterprises stands at "296-317% of the value of the loan compared to 203% MENA's regional indicator".

Export Support

  • According to the Journal of Islamic Financial Studies, small and medium enterprises in Egypt are "under performing when it comes to exporting".
  • SMEs in Egypt, Jordan, and Bahrain represent over 95% of these countries' total private enterprises while the export share is less than 20%.
  • According to Oxford Business Group, small and medium enterprises "lack the infrastructure and support mechanisms to engage in international trade". This limits their growth potential.
  • An experiment done by a group of researchers in partnership with Aid to Artisan (ATA) showed an increase in profits from 16% to 26% among random Egypt "SMEs offered the opportunity to export".
  • A 2018 OECD report shows that only 10-25% of industrial SMEs export their goods relative to 90% of large corporations in global trade.
  • The 2016 World Trade Organization's report shows that domestic exports account for 7.6 percent of the overall revenue of small and medium enterprises in the manufacturing sector in developing countries.
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Nigeria: Small and Medium Enterprises

The most recent statistics on Nigeria’s small and medium-sized enterprises published by the National Bureau of Statistics is from 2017. Based on the report, there are 41.5 million Micro, Small and Medium Enterprise (MSMEs) in the country, out of which 41.4 million are micro-enterprises, 71,228 are small businesses, and only 1,793 are medium enterprises. The 5 key industry segments in Nigeria that have the largest share of MSMEs are Wholesale/Retail Trade, Agriculture, Other Services, Manufacturing, and Accommodation and Food Services.


  • According to the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Nigeria has 41.5 million MSMEs, out of which 41.4 million (99.8%) are micro-enterprises, 71,228 (0.17%) are small businesses, and only 1,793 (0.004%) are medium enterprises.
  • The five major industries in the country with the highest number of MSMEs include Wholesale/Retail Trade, Agriculture, Other Services, Manufacturing, and Accommodation and Food Services. Below is a breakdown of the MSMEs in each sector.

1. Wholesale/Retail trade

  • The majority of MSMEs are in the Wholesale/Retail Trade industry, constituting 42.3% of all the small and medium enterprises.
  • The industry makes up 18% of licensed small businesses, 13% of licensed medium-sized businesses, and 42.3% of licensed micro-sized enterprises.

2. Agriculture

  • Nigeria's Agriculture sector has second-highest number of MSMEs, representing 20.9% of the total enterprises.
  • The industry makes up 1% of licensed small businesses and 20.9% of licensed micro-sized enterprises.

3. Other Services

  • The Other Services industry represents 13.1% of the total MSMEs in Nigeria.
  • The industry constitutes 3% of licensed small businesses, 2% of licensed medium-sized businesses, and 13.1% of licensed micro-sized enterprises.

4. Manufacturing

  • Nigeria’s Manufacturing industry makes up 9% of the total MSMEs in the country.
  • These businesses constitute 23% of small enterprises, 43% of medium enterprises, and 9.0% of licensed micro-sized enterprises.

5. Accommodation and Food Services

  • This industry represents 5.7% of all MSMEs. It makes up 3% of small enterprises, 2% of medium enterprises, and 13.1% of licensed micro-sized enterprises.

Additional Statistics

  • Lagos, the country’s commercial hub, has the highest number of SMEs in the country, with a total of 8,395, followed by Oyo and Osun with 6,131 and 3,007 SMEs, respectively. (s. 1)
  • As of 2017, the states with the lowest number of SMEs in Nigeria are Borno, Bayelsa, and Yobe.
  • The Agriculture, Wholesale/Retail Trade, and Other Services industries constitute 76.3% of all Nigerias micro-sized enterprises.
  • Education, Wholesale/Retail Trade, and Manufacturing make up 68% of the country’s small enterprises.

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South Africa: Small and Medium Enterprises

The five key industry segments in South Africa that have the largest share of small and medium enterprises include 'Wholesale & Retail', 'Community and Social Services (CSP)', 'Financial', 'Construction', and 'Manufacturing'. We have provided below a detailed overview of the micro, small, and medium-sized enterprises in each of these industry segments.

Wholesale & Retail

  • According to the data published in a 2018 research paper from the University of Cape Town, 'Wholesale & Retail' industry segment has the largest share of small and medium enterprises in South Africa. The same stood at 30.4% of all SMMEs in South Africa.
  • The industry segment comprises 29.1% of micro-enterprises, 27.9% of small enterprises, and 24.6% of medium enterprises.

Community and Social Services (CSP)

  • The 'Community and Social Services (CSP)' industry segment has the second-largest share of small and medium enterprises in South Africa. The same stood at 23.3% of all SMMEs in South Africa.
  • The industry segment comprises 19.8% of micro-enterprises, 23.9% of small enterprises, and 27.7% of medium enterprises.


  • The 'Financial' industry segment comprises 13.7% of all SMMEs in South Africa and has the third-largest share of small and medium enterprises in the country.
  • The industry segment comprises 10.0% of micro-enterprises, 14.6% of small enterprises, and 16.3% of medium enterprises.


  • The 'Construction' industry segment comprises 10.6% of all SMMEs in South Africa and has the fourth-largest share of small and medium enterprises in the country.
  • The industry segment comprises 16.3% of micro-enterprises, 11.7% of small enterprises, and 9.1% of medium enterprises.


  • The 'Manufacturing' industry segment has the fifth-largest share of small and medium enterprises in South Africa. The same stood at 9.5% of all SMMEs in South Africa.
  • The industry segment comprises 7.1% of micro-enterprises, 7.5% of small enterprises, and 10.8% of medium enterprises.

Other Helpful Findings

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United Arab Emirates: Small and Medium Enterprises

Introduction & Research Strategy

By the end of Q3 2019, there were approximately 572,615 business permits in the United Arab Emirates. Of these, GO-Gulf calculates that 95% were micro-, small-, and medium-sized businesses (SMEs). Broken down by size, approximately 72% of all business in the UAE are micro firms, while 18% are small businesses, 5% are medium-sized businesses, and 5% are large enterprises.

Although a few pre-compiled sources were located that ranked the top enterprises by number of businesses, they appeared to be slightly outdated and/or did not include the entirety of the country. Many provided values only for Dubai and Abu Dhabi, as these two cities alone account for 70.6% of all businesses in the UAE. As a result, in order to provide the most accurate data for the entirety of the country, we used triangulation to provide a more exact estimate of the top rankings by industry and number of businesses. In addition, we did locate one source from the National Economic Register of the UAE Government, which appeared as though it contained this data pre-compiled and broken down by industry and number of businesses. Unfortunately, we were unable to access this source as a result of a security firewall. Just in case it is accessible in another manner, this source has been included as well.

Below is a ranking of the top 5 industries for SMEs in the United Arab Emirates based on the total number of businesses in that segment. From there, a breakdown of the estimated number of micro-, small-, and medium-sized businesses within each industry have been calculated, as well. The values obtained via this method appeared to be more accurate than those identified in the pre-compiled sources that contained data only for Dubai, Abu-Dhabi, or older records for the country as a whole based on the fact that they are larger and justify the mentioned growth rates in other sources.

Initial Calculations to Determine Top Industries:

  • According to the Emirates News Agency (WAM), there were a total of 572,615 business permits in the United Arab Emirates at the end of August 2019.
  • Of all businesses, GO-Gulf determined that approximately 95% are SMEs. This equates to about 543,984 SMEs in the UAE.
    • Calculation: [572,615 total businesses in UAE] * [95% SMEs] = 543,984 SMEs in UAE
  • The top three sectors of businesses in the UAE based on total number of companies as of 2019 were found to be trading (57%), services (35%), and manufacturing (8%).
    • Calculation: [543,984 SMEs in UAE] * [57% trading SMEs] = 310,070 trading SMEs in UAE
    • Calculation: [543,984 SMEs in UAE] * [35% services SMEs] = 190,394 services SMEs in UAE
    • Calculation: [543,984 SMEs in UAE] * [8% manufacturing SMEs] = 43,518 manufacturing SMEs in UAE
  • In the trading segment, the top two industries by total number of businesses were found to be consumer goods trading (25%) and textile/garments trading (16%).
    • Calculation: [310,070 trading SMEs in UAE] * [25% consumer goods trading SMEs] = 77,517 consumer goods trading SMEs in UAE
    • Calculation: [310,070 SMEs in UAE] * [16% textile/garments trading SMEs] = 49,611 textile/garments trading SMEs in UAE
  • In the services segment, the top two industries by total number of businesses were found to be real estate/renting (33%) and construction/contracting (31%).
    • Calculation: [190,394 services SMEs in UAE] * [33% real estate/renting SMEs] = 62,830 real estate/renting SMEs in UAE
    • Calculation: [190,394 services SMEs in UAE] * [31% construction/contracting SMEs] = 59,022 construction/contracting SMEs in UAE
  • In the manufacturing segment, the top two industries by total number of businesses were found to be food/beverage (24%) and basic metals/fabrication (21%).
    • Calculation: [43,518 manufacturing SMEs in UAE] * [24% food/beverage SMEs] = 10,444 food/beverage SMEs in UAE
    • Calculation: [43,518 manufacturing SMEs in UAE] * [21% basic metals/fabrication SMEs] = 9,138 basic metals/fabrication SMEs in UAE

1. Consumer Goods Trading

  • Based on the above calculations, there are approximately 77,517 consumer goods trading SMEs in the United Arab Emirates.
  • Broken down by size, the number of consumer goods trading businesses are as follows:
    • [77,517 consumer goods trading SMEs] * [72% micro firms] = 55,812 micro-sized consumer goods trading SMEs in UAE
    • [77,517 consumer goods trading SMEs] * [18% small businesses] = 13,953 small-sized consumer goods trading SMEs in UAE
    • [77,517 consumer goods trading SMEs] * [5% medium businesses] = 3,875 medium-sized consumer goods trading SMEs in UAE

2. Real Estate & Renting

  • Based on the above calculations, there are approximately 62,830 real estate and renting SMEs in the United Arab Emirates.
  • Broken down by size, the number of real estate and renting companies are as follows:
    • [62,830 real estate/renting SMEs in UAE] * [72% micro firms] = 45,237 micro-sized real estate and renting SMEs in UAE
    • [62,830 real estate/renting SMEs in UAE] * [18% small businesses] = 11,309 small-sized real estate and renting SMEs in UAE
    • [62,830 real estate/renting SMEs in UAE] * [5% medium businesses] = 3,141 medium-sized real estate and renting SMEs in UAE

3. Construction & Contracting

  • Based on the above calculations, there are approximately 59,022 construction and contracting SMEs in the United Arab Emirates.
  • Broken down by size, the number of construction and contracting businesses are as follows:
    • [59,022 construction/contracting SMEs in UAE] * [72% micro firms] = 42,495 micro-sized construction and contracting SMEs in UAE
    • [59,022 construction/contracting SMEs in UAE] * [18% small businesses] = 10,623 small-sized construction and contracting SMEs in UAE
    • [59,022 construction/contracting SMEs in UAE] * [5% medium businesses] = 2,951 medium-sized construction and contracting SMEs in UAE

4. Textile & Garments Trading

  • Based on the above calculations, there are approximately 49,611 textile and garments trading SMEs in the United Arab Emirates.
  • Broken down by size, the number of textile and garment trading businesses are as follows:
    • [49,611 textile/garments trading SMEs in UAE] * [72% micro firms] = 35,719 micro-sized textile and garments trading SMEs in UAE
    • [49,611 textile/garments trading SMEs in UAE] * [18% small businesses] = 8,929 small-sized textile and garments trading SMEs in UAE
    • [49,611 textile/garments trading SMEs in UAE] * [5% medium businesses] = 2,480 medium-sized textile and garments trading SMEs in UAE

5. Food & Beverage

  • Broken down by size, the number of food and beverage companies are as follows:
    • [10,444 food/beverage SMEs in UAE] * [72% micro firms] = 7,519 micro-sized food and beverage SMEs in UAE
    • [10,444 food/beverage SMEs in UAE] * [18% small businesses] = 1,879 small-sized food and beverage SMEs in UAE
    • [10,444 food/beverage SMEs in UAE] * [5% medium businesses] = 522 medium-sized food and beverage SMEs in UAE
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Egypt: Small and Medium Enterprises

There are over 3.8 million small and medium enterprises in Egypt, with the majority of them (85.4%) being micro companies with less than 20 employees. The five biggest SME sectors include manufacturing, trading, food and beverage, construction, and healthcare.


  • According to Egypt's Census published by the OECD, there were about 3.8 million small and medium enterprises in 2017, which represent the latest available data.
  • According to data from 2014, micro businesses, those with less than 20 employees, accounted for 85.4% of all the SMEs.
  • Small businesses, those that have between 20 and 50 employees, accounted for 8.2% while medium businesses, those with 50 to 200 employees, accounted for 6.3% of all SMEs.
  • According to the same study, the 5 biggest sectors in terms of SME prevalence include manufacturing (51.1%), trading (40.5%), food and beverage (1.7%), construction(1.6%), and healthcare (1.3%).
  • While we did find more recent statistics, it only took into account SME factories in 2 different regions in the country, encompassing only about 1600 companies.
  • A specific breakdown of the exact number of micro, small and medium businesses in each sector was also not readily available. As such, we decided to use the general SME breakdown to estimate the exact number of micro, small and medium-sized businesses in each of the sectors.


  • As the manufacturing sector comprises 51.1% of the total number of SME businesses that means that there are about 1.94 million SME companies (0.511 * 3.8 million) working in manufacturing.
  • Assuming that the breakdown of SME businesses remains the same in the manufacturing sector, 85.4% of the companies will be micro companies, 8.2% will be small businesses, while 6.3% will be medium-sized businesses.
  • This means that there are 1.66 million micro, 159,080 small businesses, and 122,220 medium companies in the manufacturing sector.


  • As the trading sector accounts for 40.5% (0.405 * 3.8 million) of the total number of SME businesses, that means that there are about 1.54 million SME companies working in manufacturing.
  • Assuming that the breakdown of SME businesses remains the same in the trading sector, 85.4% of the companies will be micro companies, 8.2% will be small businesses, while 6.3% will be medium-sized businesses.
  • This means that there are 1.31 million micro, 126,280 small businesses, and 97,020 medium companies in the trading sector.

Food and Beverage

  • Food and beverage companies account for 1.7% (0.017 * 3.8 million) of the total number of SME businesses in Egypt or 64,600 companies.
  • Assuming that the breakdown of SMEs remains the same in the food and beverage sector, there are 55,168 micro, 5,287 small, and 4,070 medium companies in the country.


  • Construction companies account for 1.6% (0.016 * 3.8 million), or 60,800, of the total number of SMEs in Egypt.
  • Assuming that the breakdown of SME businesses remains the same in the construction sector, there are 51,923 micro, 4,986 small, and 3,830 medium companies in Egypt.


  • Healthcare only accounts for 1.3%, or 49,400 (0.013 * 3.8 million), of the total number of SME companies in Egypt.
  • Assuming that the breakdown of SMEs remains the same in the healthcare sector, there are 42,188 micro, 4,051 small, and 3,112 medium companies in the country.

Research Strategy

We focused our research on government databases and industry reports but most of the information was in Arabic, with no translation options available on the site. As such, we used information that was either published by the Egyptian government or supported by it. We used information from the OECD and several reports that were published by the Egyptian Central Bank. Unfortunately, we were not able to find information about the specific breakdown of the number of micro, small, and medium businesses in each category. The information for the breakdown of SMEs by industry was also from 2014 as we were not able to find a more recent breakdown.
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Nigeria: Key Financial/Business Needs


Small and medium-sized enterprises in Nigeria need many things in order to be successful over time. However, the most notable factors according to business owners in the country are access to finance, electricity, and reduced corruption in the government assistance programs set up to help them. These findings were determined based on data gathered by Enterprise Surveys, which is run by the World Bank Group. In this manner, the top obstacles rated by business owners in Nigeria were identified. From there, additional research studies and news articles from foundations were used to compliment the findings and further understand why these obstacles are so vital to business success in the nation. Below are insights related to each of these key needs, followed by data explaining why they are vital and the negative impacts that they have on Nigerian entrepreneurs.

Access to Finance

Small and medium businesses need more lenient and available access to finance options, such as loans, grants, etc. so that they no longer rely on personal funds or savings.
  • According to data collected by Enterprise Surveys, the number one problem that SMEs report having to deal with is gaining access to finance. This was reported to be the top issue by 30.2% of SMEs in Nigeria.
  • Many banks, loan providers, etc. in Nigeria require collateral and a mountain of paperwork to prove the credibility of a recipient prior to offering them a small business loan. As approximately 60% of the entire population in Nigeria lives in poverty, this proves to be very difficult for many business owners.
  • In 2019, only 10% of business owners in Nigeria reported having a bank loan or line of credit. A study published in the International Journal of Scientific and Research Publications determined that the most common reasons for this are inadequate collateral, poor record keeping, and high loan interest rates
  • In a study conducted in 2017 regarding the access that SMEs in Nigeria have to finance, it was determined that a majority are sourcing funds from their own savings, friends, etc. As a result, almost 80% of small and medium-sized companies go out of business within 5 years of starting because they ran out of money.

Access to Electricity

SMEs in Nigeria need constant and reliable access to electricity so that their businesses can operate under normal standards and bring in revenue.
  • Approximately 27.2% of small and medium-sized business owners in Nigeria reported that their number one obstacle to opening and running a company is access to electricity.
  • According to Power Africa, Nigeria as a country is currently capable of producing 12,522 MW of electric power every year. However, they only put out approximately 4,000 MW annually, with 36% being consumed in rural areas and 55% in urban areas. There are around 20 million households in the country that do not have any access to electricity at all. For perspective, the U.S. used a total of 3,749,538,000 MW of electricity in 2019.
  • The cost of providing electricity to developing businesses in Nigeria increased in 2019 as a result of government fiscal deficits and rising debt.

Reduced Government Corruption

Although out of their hands, Nigerian small and medium businesses need to see reduced corruption in the types of programs that are set out to assist SMEs so that they can actually make use of the full range of assistance that is supposed to be available to them.
  • The number one problem reported by 12.7% of Nigerian business owners to running their company is the amount of corruption in the government system designed to help them.
  • Government assistance programs for SMEs in Nigeria are highly corrupt, with many officials of these programs taking a cut of the funding for themselves. This leaves little funds for the actual businesses and only drains money from the economy.
  • In 2015, approximately $236 million was taken out of a fund provided by the Central Bank of Nigeria for small businesses and instead distributed to 24 state governors the night before the election. Instances such as these drain funds from the companies they were meant for.
  • SME assistance programs are mainly a cover for embezzlement and fraud in the current political system, rather than access to funding for the businesses that need it most.
  • Between 2014 and 2018, over $1 billion was lost from SME profit as a result of corruption in the system in the form of embezzlement, fraud, political patronage, and even gang-related activity.
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Kenya: Key Financial/Business Needs

Small and Medium Enterprises (SME) in Kenya are responsible for a considerable portion of the countries GDP. Yet several of the needs of SMEs are not being met. These include the lack of investment in the sector and the failure of banks to serve the needs of SMEs in a meaningful way. Both of these impact on the growth of these SMEs.

Capital and Finance

  • One of the biggest issues facing SMEs in Kenya is the complete lack of cohesion in the sector. There is not even an agreement of the number of businesses in the industry, with estimates ranging from 2.3 million to 12.6 million (excluding those in agriculture). The problem runs deeper, with 90% of small businesses in Kenya operating in what is known as the informal economy and there being no official registration record for most of these businesses.
  • One of the flow-on effects of this anomaly is many of the SMEs in Kenya are self-funded. A recent survey found that 68% of Kenyan businesses consider finance as one of their key needs. Self-financing is, in many situations, ideal, but it also comes with limitations; in particular, it can mean that opportunities for expansion, productivity, and growth can be severely restricted. There is a need for capital investment in Kenya's SMEs if they are to grow to their full potential.
  • If Kenya's SMEs are to grow, then capital investment is fundamental; without investment, the full potential of SMEs in Kenya will never be realized, which given the role SMEs play in the Kenyan economy, means that Kenya will struggle to grow and develop its economy.
  • An analysis of Kenya's SME business lending adds some detail to this picture. 50% of SMEs in having never approached a bank. The average number of SMEs accessing loans in the OECD is 51%; in Kenya, it is just 36%. This means that any number of SMEs in Kenya never meet their potential due to a lack of cash and the inability to access finance.
  • SMEs in Kenya make up an important part of the economy; they employ 80% of the countries workers and contribute 20% to the GDP of Kenya. However, their ability to grow will remain difficult as long as their ability to access finance is limited.
  • When analyzed further, there are several aspects to this ongoing need. The lack of seeding and angel capital is due in part to the informal nature of SMEs in Kenya. Currently, Angel investors fund about 2% of Kenya's startups, with 40% of those funded receiving less than $1,200, and only 7% receiving more than $120,000.
  • One of the difficulties is that private investors have an expectation of a 20% return on capital, which most SMEs in Kenya can't meet, and banks are unable to meet the growing demand for capital. It is estimated there is a $5 billion credit gap. Inflexible demands for collateral, high collateral requirements, and high-interest rates are just some of the issues facing Kenyan SMEs looking for investment capital.

Need for Banks to Understand and Serve SMEs Better

  • Banks need to understand and serve SMEs better. Kenyan SMEs are poorly serviced by banks, with banks tending to automatically place them in the "mini-corporate" company category when this does not accurately reflect their ongoing needs. It means that often banks fail to form meaningful relationships with SMEs and as a result the potential for growth and expansion is severely limited, which negatively impacts the Kenyan economy as a whole, given the role SMEs play in it.
  • Banks need to better understand the needs of SMEs if they are to serve them properly. The rigidity with which eligibility criteria and similar are assessed is not a true reflection on the diversity and success of Kenyan SME businesses. Admittedly the informal nature of the economy is one of the key reasons for this, but their needs to be a better way of assessing a SMEs financial position beside the organizations' financial records. The way SMEs are structured in Kenya means that the "owner manager's complete portfolio" should form part of the assessment, but currently, it rarely does.
  • There are 43 banks in Kenya, but seven of these banks control 80% of the market capital, which creates a situation which has the flow-on effect of limiting competition, ultimately this has the effect of SMEs have no incentive to innovate.
  • Sub Saharan Africa has revenue from SMEs of approximately $12 billion, with a growth rate of 20% annually. There is huge potential for growth in this area for financial institutions, yet consistent studies by mystery shoppers on behalf of McKinsley show that Kenyan Banks are not capitalizing on this due primarily to their first impressions and initial service delivery.
  • It is a statement about the relationship between the banks and SMEs in Kenya that it is Safaricom, not the banks that is pushing the mobile payment system in Kenya. It has developed M-Pesa, a system that allows payments from mobile phones. In Kenya, mobile phone payments make up 55% of the non-cash payments in Kenya as a result. This is in preference to the banks' offerings of debit and credit card payments. 69% of Kenyan adults have made a digital payment, yet only 11% have used a debit card and 3% a credit card.
  • While Kenya is a model of how to evolve payment systems without the assistance of banks, ultimately it is detrimental to the business model as the relationship between banks and businesses suffers and is totally lacking as a result, which means other aspects of a banking relationship that could benefit SMEs are never explored. Banks need to step up and recognize SMEs as businesses in their own right.
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United Arab Emirates: Key Financial/Business Needs

Two key financial needs for small and medium enterprises in the United Arab Emirates are access to affordable lending and convenient credit cards.

Access to Affordable Lending

  • Access to affordable lending was determined to be a key financial need of small and medium enterprises (SMEs) in the United Arab Emirates (UAE) based on the fact that the availability of bank loans has been highlighted as a significant gap for such organizations in the region by a wide variety of industry experts, including business media (e.g., Entrepreneur), industry researchers (e.g., 4SightGlobal), Middle East newspapers (e.g., The National) and local businesses (e.g., Jitendra Consulting Group).
  • According to Jitendra Consulting Group, obtaining access to bank financing is the "core challenge faced" by SMEs in the UAE, particularly following the recent regional economic slowdown.
  • Jitendra Consulting Group adds that bankers in the UAE generally consider SMEs as not bankable, due to the fact that small and medium enterprises in the region often lack sufficient collateral, have limited credit history, have less robust business plans and financial records and have a general "reputation of bad debts."
  • As evidence of this challenge, the National reports that 65% of SMEs are rejected for lending in the UAE (approximately 5 times higher than in OECD countries) and are charged "extremely high" interest rates of between 14% and 24% on banking loans.
  • In parallel, a 2019 survey of UAE SMEs by 4SightGlobal reported that 40% of small and medium enterprises in the region find it difficult to obtain loans, while 33% find local interest rates on loans to be unaffordable.
  • Anecdotal evidence from the survey similarly reported that "not all banks are open" to giving SMEs business loans, and that many banks "laugh in their face" when they apply.

Convenient Credit Cards

  • In parallel, convenient credit cards were selected as another key financial need of SMEs in the UAE, given that this business gap was identified in a 2019 survey of UAE SMEs and further corroborated by top-tier national reporting (i.e., The National) and business media (i.e., Entrepreneur).
  • According to the 2019 survey by 4SightGlobal, a majority (62%) of small and medium enterprises in the region do not have a business credit card.
  • Moreover, 25% of SMEs in the region that don't have a business credit card report difficulties in qualifying for such credit options and/or the substitution of personal cards for such purposes.
  • According to UAE SME founder Karl Naim, one major hurdle for SMEs in obtaining corporate credit cards in the region is the requirement for six months of operations before a UAE bank will issue such a credit facility.
  • Mr. Naim adds that, once authorized, credit cards are also less convenient for SMEs in the region, given that they "act more as a debit card" and require having an amount blocked on current accounts.
  • While the National reported last year that Noor Bank, First Abu Dhabi Bank and other banking institutions are newly targeting SMEs in the region for new business credit card offerings, many of these options still come with challenging or less convenient stipulations, such as minimum business turnover, high annual fees and the requirement for businesses to be in operation for a minimum number of years.
  • Overall, 4SightGlobal determined that credit cards were a significant but "latent" business need for SMEs in the UAE, given that there is a "lot of head room" for banks to make credit cards available for these types of businesses and offer convenient solutions.
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VISA and SMEs: Global

VISA has partnered with various organizations and companies around the world to help SMEs flourish amidst the COVID-19 pandemic and other business challenges.

VISA Partnerships that Benefit SMEs

VISA's Initiatives for SMEs Worldwide

  • VISA has pledged to fund two initiatives that aim to help SMEs.
  • To respond to the urgent need for support from various local communities during the COVID-19 outbreak, VISA is in the process of giving $10 million to frontline charities that are involved in providing public health and food relief services to combat the outbreak.
  • This amount will include the charities from all the regions where VISA has a presence such as North America, Latin America and the Caribbean, Europe, Asia Pacific, and Central Europe, the Middle East, and Africa.
  • The rest of the $200 million will be allocated as part of a five-year program that aims to support women's economic endeavors.
  • VISA will distribute this amount to non-government organizations (NGOs) and investment companies that can help SMEs.
  • The fund can also help as a relief for the $300 billion annual credit deficit in funding for SMEs owned by female entrepreneurs.

VISA and Dubai SME

  • VISA has inked an agreement to partner with Dubai SME, the Government of Dubai's Department of Economic Development (DED). As part of the agreement, benefits will be offered to the top 100 SMEs in the payments sector every time they swipe their Visa Business Card.
  • SMEs can get discounts and savings from selected merchants around the world for their business-related expenses.
  • They are also invited to attend training sessions on effective working capital management when using the VISA Business Card.
  • There is a two-year validity period for this benefit that coincides with the duration of the ranking in the list.

VISA and Billhop

  • VISA has also partnered with Billhop to assist SMEs in Ireland.
  • Billhop is a Swedish payment platform.
  • The payment collaboration with VISA was first deployed by Billhop in the UK and Sweden.
  • As part of the new agreement, Billhop can now let its customers from Ireland to provide payment to their suppliers using their current credit cards without the need to enroll them.
  • The agreement will allow current Billhop customers to pay for their invoices with an effective rate of 1.99% using the credit card. This rate is already reduced as the typical interest is at 2.95%.
  • This agreement came about to address the preference of SMEs to pay using their cards as this channel is more convenient, simple, and easy to monitor.

VISA's Partnership with Neat

  • VISA has partnered with Neat, Pacific Century Group, and MassMutual Ventures Southeast Asia to support an initiative to accumulate $11 million in funding round for SMEs,
  • Neat is a fintech company that provide accounts in various currencies to SMEs and startups.
  • Neat will use the funds to further take on more SMEs and startups worldwide.
  • The participation of VISA will also enable Neat to offer corporate expense cards to SMEs for their ATM transactions and shopping needs.

VISA and ShopAppy

  • VISA has collaborated with, an e-commerce platform that lets SMEs promote and sell their products or services through digital channels.
  •'s goal is to offer urgent help to the SMEs to enable them to stay afloat and ready to re-open their shops once the outbreak has subsided.
  • Visa’s collaboration with is one of its major endeavors to assist SMEs after deploying its "Where You Shop Matters campaign last Christmas."
  • VISA is providing help to by investing in the platform to help it to expand more. VISA is also sharing its digital and brand marketing knowledge to enable more SMEs to enroll in the program.

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Visa's response to the COVID-19 crisis includes financial and technological support for its employees, clients, and communities. Some noteworthy measures taken by the company to fight the global pandemic include financial assistance of $210 million for women-led small businesses, commitment for no COVID-19-related layoffs, fee wavier for online payments, and COVID-19 Dispute Monitoring Program, among others.

Support for Employees

Support for Clients

Support for Business Operations

Support for Community

  • Visa and iFundWomen announced grants of $10,000 each to four female entrepreneurs who plan to expand their businesses by offering products and services that will bring relief during the COVID-19 pandemic.
  • The company launched a new tool that enabled customers to view the list of small stores that have completed a Visa transaction in the last 24 hours. The tool allows customers to sort businesses by type, city, and zip codes.
  • The Back to Business Project tool connects customers looking for grocery stores, handyman, or flower shops to small businesses that are open during the COVID-19 pandemic.
  • Visa launched the 2020 Visa Everywhere Initiative, challenging startups to develop support services for small businesses to recover from the financial impact of the COVID-19 crisis.
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VISA has primarily partnered with MEA-based companies to offer incentives or virtual cards to existing cardholders or attract people who currently don't have a bank account. Recently, VISA has partnered with Dubai Silicon Oasis Authority, Branch, Interswitch, Jumeirah Group, MFS Africa, and Paga.

Dubai Silicon Oasis Authority

  • VISA "partnered with Dubai Silicon Oasis Authority (DSOA) in a $1 million investment in the Dubai Smart City Accelerator that aims to support start-ups and FinTech companies."
  • Visa also hosted the "Dubai Smart City Accelerator's FastTrack mentoring session" in the summer of 2018.
  • The Dubai Smart City Accelerator focuses on startups that are developing innovative ways of making cities smarter and finding solutions to challenges concerning waste, energy, and congestion.
  • The partnership between VISA and DSOA also allows both of the organizations to increase awareness of emerging and innovative payment solutions technologies in MEA through workshops, hackathons, and events.


  • In April 2019, VISA partnered with Branch, a finance app that offers services in Nigeria, Kenya, and Tanzania, since both companies envision driving financial access to "more than two billion people" globally who are "unbanked."
  • Through the partnership, Visa and Branch will provide virtual prepaid debit cards to Branch's "unbanked and underbanked" clients to receive credits at ATMs without needing bank accounts.
  • The partnership will also enable people to receive a virtual Visa account in order to make an account on Branch’s app. This will allow Branch to reach larger populations such as Nigeria, "where cards have factored more prominently than mobile money in connecting unbanked and underbanked populations to finance."


  • In November 2019, VISA paid "$200 million for 20% stake in Interswitch," which is one of the largest electronic payments firms in Africa.
  • Interswitch's services include online payment platforms, point-of-sale terminals, and a debit card network that has over 19 million active cards.
  • Some tech investors believe VISA’s investment in Interswitch will greatly change the continent's "fintech landscape" and it also "confirms the strategic interest of global payment giants in Africa’s financial services industry."

Jumeirah Group

MFS Africa


  • In March 2020, VISA partnered with Nigeria-based startup Paga, which has more than 14 million customers in the country that uses Paga to pay bills, transfer money, and purchase items online "through its mobile-app or 24,840 agents."
  • VISA has been looking to expand in MEA as more people are opting for digital payments, and this partnership with Paga will allow VISA to "work together on tech" in Africa.
  • The partnership is predicted to allow both companies to achieve "larger payment volumes" and "drive financial inclusion."
  • Both company's engineering teams are now collaborating to "launch QR codes and NFC payments" by the second quarter of 2020.
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SMEs in the Middle East

Small and Medium Enterprises comprise the majority of registered companies in the Middle East and North Africa region, and they account for approximately 50% of jobs in the area. However, they receive insufficient funding, with the lowest bank lending percentage worldwide and the highest financial gap.

Size and Estimated Growth

  • According to the World Economic Forum 96% of the companies registered in the MENA region are SMEs.
  • In 2018, the value of Small and Medium Enterprises (SMEs) in the entire Middle East and North Africa (MENA) region was calculated at $1 trillion.
  • Furthermore, according to a study, the SME market in the Gulf Cooperation Council (GCC) sub-region, which includes the United Arab Emirates, Qatar, Oman, Bahrain, and Kuwait, will be $920 million by 2022.

Type of Businesses

  • Start-ups represent 0.3% of the companies in the MENA region, which might be a result of insufficient funding.
  • As for the composition of SMEs in the region by sector, a study by Allied Investment Partners Research revealed that the vast majority of SMEs in the region are dedicated to trading.

Influence in Employment

  • The World Economic Forum has also established that approximately 50% of employment in the MENA region is provided by SMEs.
  • In addition, SMEs employment benefits could increase during the following years according to this Forum. In total, if financing for these companies increases, their growth could lead to the creation of approximately 15 million jobs by 2025.

Bank Funding and Loans

  • Despite this, current funding for SMEs in the MENA region is the lowest in the world, as bank lending allocated to these companies only represents 7% of total loans in the region.
  • In addition, according to the World Bank, the MENA region has the "highest proportion of the finance gap compared to potential demand", with a total of 88%.
  • This funding and financial gap statistics have to do with the little access to funding SMEs have in the region. Furthermore, it has been estimated that this number would be even larger if informal SMEs, which are not registered, were to be considered.
  • Interestingly, large funding differences are observed across the MENA region, with Moroccan banks allocating 24% of their loans to SMEs, while banks in GCC countries only assign an estimated 2% of their loans to these enterprises.

Alternative Funding

  • However, certain governments have decided to take measures to fuel the growth of SMEs. One example of this is Dubai, where SMEs will receive 5% of capital projects endorsed by the government.
  • Other alternatives to bank lending have emerged to fund the growth of SMEs. Some of these include Peer-2-Peer lending and crowdfunding.

Research Strategy

We searched through industry reports, reputable news sources, and international economic studies to identify information specific to the Middle East. However, we found that the vast majority of reports, studies, and news outlet refer to the position, influence, and general statistics about SMEs in the Middle East and North Africa region, which is why we have provided statistics for this region.

From Part 04
  • "SME businesses account for 42% of the workforce, and contribute around 40% to the total value-add generated in Dubai’s economy"
  • "Micro firms account for 72% of the overall business count in Dubai, followed by Small and Medium Firms (SMBs) accounting for 18% and 5% of the business count"
  • "Sector-wise SMEs by Number of Establishments: - Trading: 57% - Services: 35% - Manufacturing: 8%"
  • "License Issued Statistics by Sector: Manufacturing: - Food & Beverages: 24% - Basic Metals and Fabricated: 21% - Others: 55% Services: - Real Estate, Renting: 33% - Construction & Contracting: 31% - Others: 36% Trading: - Consumer Goods Trading: 25% - Textiles and Garments Trading: 16% - Others: 59%"
  • "SME Workforce Employed by Each Industry Category: - Trading: 33% - Services: 51% - Manufacturing: 16%"
  • "Some 400,000 SMEs already contribute over 60% of the non-oil economy and provide 86% of the private workforce. They make up 73 percent of the UAE’s wholesale and retail trade sector, 16% of the services sector, and 11% of the industrial sector."
  • "Contributors to Dubai GDP 2017: - Wholesale & Retail Trade: 26.6% - Transport & Storage: 11.8% - Financial & Insurance: 10.4% - Manufacturing: 9.4% - Real Estate: 7.1% - Construction: 6.3% - Accomodation & Food (largely tourism): 4.9% - Information & Communictation: 4.1% - Others: 14.3%"
  • "The report by Diligencia, Gulf Capital and MEED reveals that the number of small and medium-sized enterprises (SME) entering the UAE has grown by 30% over the past decade"
  • "According to the Ministry of Economy, SMEs account for about 94% of all companies operating in the UAE and they employ about 86% of the country’s private sector’s workforce"
  • "It reports that an average of 1,000 new company licences were registered every year in Dubai from 2015 to 2018"
  • "- Trade and repair services: 131,000 - Construction: 66,000 - Manufacturing: 31,000 - Real estate, rental and business services: 30,000 - Transportation, storage, and communication: 25,000 - Community, personal services and other: 24,000 - Hotels and restaurants: 19,000 - Others: 10,000 - Educational services and studies: 2,000 - Financial intermediation: 2,000"
  • "A total of 32,256 business licences were issued in the UAE over the first eight months of the year, signalling growing investor confidence in the country"
  • "The increase brought to 572,615 the total number of business permits in the country, a growth of 6 percent from 540,359 at the end of December"
  • "Abu Dhabi and Dubai accounted for 70.6 percent of the total number of business licences issued across the country by the end of August (404,492), according to the Ministry of Economy's National Economic Register"
From Part 06
  • "% of firms choosing access to finance as the biggest obstacle: 30.2%"
  • "% of firms choosing electricity as the biggest obstacle: 27.2%"
  • "% of firms choosing corruption as the biggest obstacle: 12.7%"
  • "% of firms choosing tax rates as the biggest obstacle: 5.9%"
  • "% of firms choosing transportation as the biggest obstacle: 5.7%"
  • "% of firms choosing political instability as the biggest obstacle: 4.4%"
  • "% of firms choosing the informal sector as the biggest obstacle: 4.3%"
  • "% of firms choosing access to land as the biggest obstacle: 2.6%"
  • "% of firms choosing trade regulations as the biggest obstacle: 2.2%"
  • "% of firms choosing tax administration as the biggest obstacle: 1.6%"
  • "high borrowing costs, multiple taxation, currency volatility, infrastructure shortfalls, and red tape all make doing business in Nigeria exceptionally difficult"
  • "Businesspeople like the wheeler-dealers of Balogun Market are not only undermined by everyday graft—shakedowns by licensing officials, extortion by safety inspectors, racketeering by police, customs officers, and local gang members—they are also hurt by the grand corruption that pervades government programs meant to help them"
  • "they are set up to fail—eroding trust in government and functioning as conduits for embezzlement, contract fraud, and the distribution of political patronage. This top-down corruption amounted to over $1 billion between 2014 and 2018—more than Nigeria’s combined capital expenditure on health and education over the same period"
  • "Partner, Tax, Regulatory & People Services, KPMG in Nigeria, Ajibola Olomola, urged the government to intensify efforts towards building domestic capacity across critical sectors such as manufacturing and ensure that tax enforcement practices do not stifle business growth."
  • "more than 90 per cent of the country’s foreign exchange earnings are from crude oil and gas, adding that the huge gap between the foreign exchange supply and demand leads to price distortions and increased demand in the parallel market."
  • "such loans can be very hard to get, however, as smaller or younger businesses tend to lack the kind of collateral and paper trail loan officers like to see. This gap between the financing needs of micro, small, and medium enterprises (MSMEs) and the availability of bank loans is often called “the missing middle."
  • "nd while worldwide, one-third of business owners reported having a bank loan or line of credit, for sub-Saharan Africa, that number dropped to about one-fifth, and for Nigeria, it was lower still at only one-tenth"
  • "GDP growth over the past five years has been unimpressive for such a resource-rich developing country"
  • "Economic freedom and economic development have been battered by Nigeria’s chronic and severe political instability, intervention in the economy by the central bank and government, and pervasive corruption"
  • "The government maintains an overvalued official rate for Nigeria’s currency so that gasoline subsidies can be maintained. Additionally, the economy is held back by power shortages, insecurity, high inflation, and tight credit conditions"
  • "Protection of property rights is weak. Bribery is a common practice when starting a business and registering property. The judiciary is hobbled by political interference, understaffing, underfunding, inefficiency, and corruption. Pervasive corruption is rarely investigated or prosecuted, and impunity remains widespread at all levels of government"
  • "Incremental improvements in starting a business, getting electricity, and enforcing contracts outweigh the added opaqueness that has been added to the property registration system"
  • "More than 60 percent of Nigeria’s people live in extreme poverty. A vibrant labor market has yet to develop. The cost of funding government electricity and fuel subsidies soared in 2019 as the country grappled with fiscal deficits and rising debt levels"
  • "Nigeria is the largest economy in sub-Saharan Africa, but limitations in the power sector constrain growth. Nigeria is endowed with large oil, gas, hydro and solar resource, and it already has the potential to generate 12,522 megawatts (MW) of electric power from existing plants, but most days is only able to generate around 4,000 MW"
  • "Current Access Rate: 45% (Rural: 36%, Ubran: 55%) Households without Power: 20 mllion"
  • "Installed Capacity: 12,522 MW (Thermal: 10,142 MW, Hydro: 2,380 MW) Reached Financial Close: 3,034 MW Power Africa 2030 Pipeline: 11,750 MW"
  • "Corruption is endemic within Nigerian government agencies meant to help MSMEs. Relative to their high cost, these agencies’ programs appear to help very few actual small business people. Instead, they are set up to fail—eroding trust in government and functioning as conduits for embezzlement, contract fraud, deliberate waste, and the distribution of political patronage"
  • "MSME-related corruption rarely grabs headlines, making it an attractive target for Nigeria’s resourceful kleptocrats. Civil servants, unscrupulous business people, legislators, and even some presidential appointees appear to be complicit. Officials routinely obfuscate and stonewall journalists and civil society groups when asked about these programs. Anticorruption agencies, meanwhile, have shown little interest in investigating this increasingly prevalent form of corruption"
  • "Nigerian officials use populist, private-sector friendly rhetoric to justify new MSME assistance programs even though they are a drain on public finances because corruption and mismanagement negates their intended impact"
  • "The destructive effects of corruption limit how much the MSME sector can contribute to Nigeria’s socioeconomic development. Unless the government reforms its programs, the future potential of small businesses to boost GDP, soak up unemployed youth, generate tax revenue, and stabilize postconflict areas will remain limited"
  • "This type of corruption undermines small business’s trust in government and sows enmity between borrowers and lenders, making public-private assistance programs less successful with each iteration. Nigerian government agencies need to open up and more closely involve the organized private sector in the planning and implementation of MSME-focused programs. International partners could play a role in facilitating this closer cooperation"
  • "small businesses in Nigeria are mostly financed through personal savings and loans from informal sources such as families, friends, and cooperative associations"
  • "It was discovered that the mortality rate of small businesses in Nigeria is high to the extent that 80% are out of businesses within the first five years"
  • "If small businesses can access financing from formal financial institutions in Nigeria, the tendency that they will grow and be quoted as public companies are high if such financing is strategically applied to innovative businesses."
  • "Small business owners and managers are discouraged to apply for a loan from a financial institution because of administrative frustrations involved in the loan application procedures "
  • "A study by Oliyide (2012) discovered financial institutions in Nigeria does not associate with risk involving SMEs loans, while Opara (2011) stated that SMEs inadequate collateral and bad records are the reasons why financial institutions avoided SMEs loan applications. High interest rate is one of the factors that prevent SMEs from applying for financial institutions loans"
From Part 10