Finance House unveils SME Loans against Gold

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Finance House’s new gold loans will allow SME owners to borrow up to AED 1 million in cash, using gold as a collateral, whether in the shape of jewellery, coins or bars….reports Asian Lite News

Finance House, one of the UAE’s leading financial institutions, launched MENA’s first instant loan facility for Small and Medium-sized Enterprises (SMEs) in the UAE, against their gold holdings or gold-related investments.

While SMEs represent the vast majority of the UAEs businesses, securing a bank loan remains one of their biggest challenges and a major hurdle to their development. The aim of Finance House’s SME gold loan is to provide finance-seeking entrepreneurs with faster, easier and cost-effective access to liquidity to meet their various business needs.

Earlier in January 2022, Finance House also became MENA’s first licensed lender to offer gold loans to individuals across the UAE. Building on this experience and its now established expertise in the segment, the group has extended its offering by introducing a similar product line tailored to the specific needs of SMEs.

T.K. Raman, the CEO of Finance House, stated: “In the backdrop of evolving commodity markets, Finance House found an opportunity for customers to benefit from more favourable gold prices and get immediate money for the value of an otherwise idle asset, without having to sell it. We are extremely proud today to be pioneering another new segment in the UAE’s fast growing finance services sector, being the first licensed financial institution in the region to offer gold loans to both individuals and now also SMEs.”

Finance House’s new gold loans will allow SME owners to borrow up to AED 1 million in cash, using gold as a collateral, whether in the shape of jewellery, coins or bars. The value of gold at the time of its assessment determines the amount of money that can be borrowed.

Mr. Raman added: “This new product line reflects our determination, once again, to constantly innovate and provide creative, adaptable, and faster financial solutions that meet our customers’ unfulfilled needs in the market. SMEs are the backbone of the UAE economy and play a critical role in the development of our country’s private sector. Finance House is therefore committed to further supporting them by easing their access to resources to help them achieve their full potential, while strengthening the UAE’s financial ecosystem.”.

Gold loans by nature are backed by a secure and tangible asset, which makes them accessible to any type of customer, regardless of credit history, business plan, or development strategy, as long as the borrower can provide suitable gold as a collateral for the loan, and is registered in the UAE, either as an SME or as an individual. They also have typically lower interest rates than other business loans.

Finance House being a public shareholding company licensed and regulated both by The Central Bank of the UAE, and the Securities & Commodities Authority (SCA), the group’s gold loans are also significantly more secure for gold owners than similar credit options provided by unregulated players in the market.

Main features and advantages:

Finance House Gold loans offer multiple repayment options for periods varying between 6 and 48 months. Advantages include; Lower interest rates than other business loans, Faster access due to shorter processing times, No restrictions regarding the way the money should be used, Flexible and early repayment options, Basic documentation requirements AJD and Security of the gold – deposited in a licensed entity with appropriate insurance cover

In addition to gold loans, Finance House has been supporting SMEs since inception in 2004 with a variety of alternative financial solutions, including collateral fee financing, flexible payment periods of up to 48 months, competitive interest rates and business loans of up to AED 1 million. Earlier in November 2022, the group also partnered with Khalifa Fund for Enterprise Development to further facilitate access to financial services for SMEs owned by UAE Nationals.

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