Abu Dhabi skyline
UAE Central Bank wants banks to accelerate the flow of relief funds to businesses and individuals in distress as a consequence of COVID-19. Image Credit: Gulf News Archive

Dubai: The Central Bank of UAE (CBUAE) has urged all banks operating in the country to extend help for corporates, small and medium enterprises (SMEs), and individuals to mitigate all risks associated with the COVID-19.

On Sunday, Abdulhamid Saeed, the Governor of the Central Bank of the UAE, held his first meeting with CEOs of banks operating in the country to emphasize the systemic significance of extending support to private sector companies and individuals who can benefit from the announced Dh256 billion Targeted Economic Support Scheme (TESS).

At the meeting, bank CEOs endorsed the exceptional measures taken by the CBUAE in a short time span and welcomed the efforts of the Central Bank  to support the banking sector and the national economy from the impact of the spread of COVID-19. They expressed their willingness to participate in the TESS.

In addition, the CEOs confirmed to the CBUAE their decision to avail the benefits of TESS.

The Governor hosted an in-depth discussion of the measures implemented under TESS and stressed the importance of banks’ commitment to utilising the Scheme to the full extent possible for the benefit of corporates, individuals and the economy in general.

TESS takes off

A number of CEO of banks shared the progress of their utilization of TESS tand their targeted outreach programme to support affected customers, including individuals, private corporate customers, and micro, small and medium enterprises (MSME’s).

Since the launch of the TESS on March 14, Dh10 billion has been provided to banks in the form of zero interest funding, and over Dh61 billion in lowered cash reserve requirements, which are to be deployed to directly benefit companies and consumers adversely impacted by the pandemic.

“It is encouraging to see that banks operating in the UAE are drawing upon the Targeted Economic Support Scheme to support the liquidity needs of customers, as we aim to cushion the economic impact of the pandemic on companies as well as individuals,” said Saeed.

Abdulhamid Saeed, UAE Central Bank governor

The Central Bank said in a statement that it encourages all boards and managements of banks to accelerate their confirmation to implement TESS measures. "From our side, CBUAE will be reaching out to the banks during the coming days to better understand how they plan to serve the objectives of TESS and help their customers to cope with the consequences of the pandemic," the governor added.

“I am confident that the Scheme will act as a catalyst to strengthen economic activity and effectively mitigate financial risk, while also ensuring that the businesses are prepared for the post-COVID-19 era.”