Dubai Airshow 2021: Tawazun reveals progress of Venture Debt Programme

The UAE's Tawazun revealed on 17 November that it had provided AED350 million (USD95.3 million) in loans to Emirati firms through its Venture Debt Programme, which is managed by the organisation's Strategic Development Fund (SDF).

Since its launch two years ago, the Venture Debt Programme has supported 15 projects in the defence and security, technology, and aviation sectors, among others. At its launch in November 2019, the programme had a maximum fund of AED700 million, with the SDF expecting the funding to increase its current commitments by another AED300 million.

Abdulla Naser Al Jabaari, SDF managing director and chief executive officer, said that the “programme offerings are primarily targeted towards supply chain contracts, bank guarantees, capital expenditure, with a ticket size of AED10–60 million”.

Zeyana Salah Al Hemeiri, principal, Venture Debt Programme, said the programme had witnessed increasing interest from small and medium-sized enterprises (SMEs), and therefore, “we are currently studying the possibility of increasing the allocated fund, expanding target market segments to include new industrial sectors, and diversifying the products offerings”.

An expansion of the programme could include allowing foreign-owned companies based in free zones access to the programme. Companies have to be 51% Emirati owned, and serving government contracts if they are operating in the free zones.

The Venture Debt Programme supports SMEs operating in the defence, security, and aviation sectors with low-cost loans to support capital expenditure and supply chain financing, or innovation projects. Capital expenditure and supply chain loans are limited to between AED10 million and AED60 million, while innovation projects are limited to AED5–20 million.