Accessing business loans and credit facilities as a UAE free zone company is possible but requires a track record with your bank. Here is what financing is available and what lenders look for.
Types of Business Financing Available in UAE
Overdraft Facility
An overdraft allows your business account to go into negative balance up to an approved limit. Overdraft interest rate: 6–10% per annum on the utilised amount. Minimum requirement: 12 months of banking history with the lender + AED 500,000+ annual turnover through the account. Collateral: often unsecured up to AED 500,000 for established businesses; secured (property or deposits) above that amount.
Business Term Loan
Fixed-amount loan repaid over 12–60 months. Minimum requirement: 2 years of audited financial statements + 12 months banking history. Interest rate: 7–12% per annum. Maximum amount: typically 1–2x annual net profit (assessed from audited accounts). Best banks: Emirates NBD Business, FAB Business, ADCB Business.
Invoice Discounting / Receivables Finance
Submit outstanding invoices to the bank and receive 80–90% of their face value immediately. Particularly useful for free zone companies with long payment terms (30–90 days). Best for: B2B service companies with reliable enterprise clients. Banks offering this: Emirates NBD, Mashreq, FAB. Discount rate: 8–12% per annum.
Government Financing Programs
Mohammed Bin Rashid Fund (Dubai): Loans for SMEs up to AED 3 million at preferential interest rates. Available to UAE mainland companies (not exclusively free zones) with 2+ years of operation. Khalifa Fund (Abu Dhabi): Grants and soft loans up to AED 3 million for Abu Dhabi-based businesses. Open to free zone companies in Abu Dhabi free zones.