The barriers that our solution address are as follows:
a) Lack of collateral: Most start-ups have difficulties in putting up the level of collateral that banks require against loans. This barrier is addressed by the Khalifa Fund financial schemes. These schemes were established to support SMEs that provide entrepreneurs with interest and collateral free loans to support them in starting up their businesses.
b) Lack of financial capacity: one of the main constraints that prevent SMEs from succeeding is the lack of financial capacity when needed, SMEs usually need financial support in the first 3 years of their lifecycle, and financial institutions are reluctant to provide businesses that do not have a proven financial track record with the necessary funds. Our financial solutions addresses this issue.
c) Lack of SME access to skills / knowledge / markets: Khalifa Fund recognizes that counseling, training, mentoring and implementation support are key components to supporting entrepreneurs We conduct specialized training courses to meet the entrepreneurs’ needs.We continuously update and improve our training curriculum to further develop our entrepreneurs and provide them with all of the tools necessary to succeed. In addition we provide marketing support, by providing introductions to government and private sector, for orders/waivers.
d) Unavailability of financial products tailored to SME needs:
SME start-ups and businesses in expansion phase face the challenge of getting appropriate financial products tailored to their requirements, at the right interest rates. KF lending schemes are tailored appropriately, as per the SMEs requirements. In addition, the promoter's contribution is only upto 10% and the loans are interest free. This allows the new SMEs to establish and build themselves for success.
e) Lack of financing to women entrepreneurs:
Although women entrepreneurs had support initiatives in Abu Dhabi (eg: Mobdeaa initiative by the AD Chamber of Commerce to support home based businesses, and Abu Dhabi Business women council), those were not financial programs.KF financial solutions (especially micro financing) filled this gap. We are working closely with our stakeholders to ensure that women entrepreneurs can benefit from all of the different support programs offered for them.
f) Specific barriers to fragile and weak states:
KF recognizes its socio economic role, of developing the rural areas within Abu Dhabi, through developing entrepreneurs in these areas (especially Western Region), to be self reliant, since there are limited employment opportunities, even for educated youth. .
KF tailored "Sougha" program to support the Khutwa funding scheme, which targets women in the Western Region, which is the rural region of the Emirate of Abu Dhabi. It is mostly desert, and accounts for 80% of the total land. Employment opportunities are very limited, even for the educated youth.