Financing is still a top challenge facing entrepreneurs, according to 45 per cent of the 152 small and medium enterprises surveyed recently, out of which 21 of them said acquiring funds is proving to be very difficult for small business owners in the UAE.

The new MEED survey of SMEs in the UAE was conducted ahead of this year’s edition of the Gulf Capital SME Awards, which is not accepting entries for its annual recognition programme honouring outstanding business leaders and entrepreneurs as well as successful small businesses.

Many SME owners still turn to family and friends as their top source for acquiring finance (49 per cent), followed by banks (41 per cent) and other sources such as private firms, angel investors, credit cards and savings (10 per cent), it said.

Dr Karim El Solh, chief executive officer of Gulf Capital, a leading alternative investment firm in the Middle East and headline sponsor of the awards, said: “The SME sector has been a critical element of the UAE’s economic success story, providing thousands of jobs and contributing over 95 per cent to the country’s annual GDP.

“While many financial institutions have significantly increased allocations for loans and other financing packages for aspiring start-ups and small business owners, there remains a need for a more SME-friendly support system that will provide easy access to funds for aspiring entrepreneurs  and for supporting the growth aspirations of existing businesses.”

While the government has intensified its support for SMEs through the Khalifa Fund for Enterprise Development in Abu Dhabi, as well as an equity fund and other financial support provided by Dubai SME, many expatriate-owned start-ups, which account for almost 95 per cent of the SME sector, still face  huge obstacles in acquiring financing, said the survey.

Becky Crayman, head of Awards, MEED, said: “Much of the difficulty in acquiring financing is rooted in the SMEs’ ability to provide a solid business and financial plan, though that needs to be addressed, entrepreneurs who have built a track record of success should find it easier than most to secure financing.

“This is where public recognition comes in, as it lends greater exposure for successful  SMEs and affirms that they have a solid growth plan.”

In addition to recognising new businesses through the ‘Start-up Business of the Year’ category, the awards is also inviting SMEs to submit entries in the following categories - ‘Gulf Capital Business of the Year’, ‘Emirati Business of the Year’, ‘Small Business of the Year’ and ‘Online Business of the Year.’

The annual SME awards programme also honours impressive performance in key business success factors such as innovation, customer focus, employee-oriented initiatives, as well as sustainability practices and will be accepting nominations for ‘Business Innovation of the Year’, ‘Customer Focus of the Year’, ‘People and Culture of the Year’, and ‘Sustainable Business of the Year’.

Meanwhile, the ‘Entrepreneur of the Year’ and ‘Business Leader of the Year’ awards will recognise outstanding entrepreneurial efforts and inspirational leadership.

The deadline for submission of entries is on May 28. - TradeArabia News Service