Dubai: Noor Trade, Sharia compliant banking service from Noor Bank for small and medium enterprises (SMEs) is fast expanding its reach across key SME locations while expanding its sales staff to reach out to customers across the country, Usman Khakwani Head of Business Banking & Liabilities, Noor Trade told Gulf News in an interview.
“SME business is the fastest segment within Noor Bank. Over the last one year the bank has increased its sales staff by more than 300 per cent. This year again we are planning to double staff,” said Khakwani.
Noor Bank created the concept of Noor Trade in 2013 to cater exclusively to SMEs. Unlike most banks that have their SME business residing partly in the corporate banking or partly in the retail banking business, Noor Bank wanted to create a specialised division and talent pool to specifically address the needs of SMEs.
Within Noor trade there are two distinct business units which are Business Banking and Emerging Corporates. While the Business Banking focuses on companies that have turnovers in the range of Dh2 million to Dh75 million, Emerging Corporates segment caters to companies with turnovers from of Dh75 million to Dh350 million.
With the recent opening of its new business hub at the Noor Takaful office in Al Quoz area, Noor Trade currently has three dedicated business centres including one in Dubai Multi Commodities Centre (DMCC) and another in Deira. In addition to these centres, Noor Bank has 12 trade desks across its branch network.
“We are fast expanding our reach through our dedicated centres, trade desks in Noor Bank branches, a growing sales force and multiple digital channels such as call centres and internet banking. This year we are planning two more new centres, one in Dubai World Central and another in Bur Dubai,” said Khakwani.
The new business hubs Noor Trade has been creating are in proximity to key areas that have significant concentration of SMEs. For example the Al Quoz area is covered by the branch located at the Noor Takaful office, DMCC office covers the Jumeira Lake Tower (JLT) area. Similarly, Dubai World Central will cover the new business area that is being developed close to the new airport and the Expo 2020 site.
“As a strategy we will continue to develop our presence into those newly developing areas. Currently we have a very robust sales team that actually goes to the newly developing business areas and services the clients there. In addition to this we have a very comprehensive online banking platform, which helps our clients to do their banking on digital platforms. Our clients have got 24/7 access to our call centres,” he said.
Noor Trade has set out a target of Dh5 billion financing for SMEs by 2017, Khakwani said the division is certain to meet this target while in terms of client base it has more than doubled the numbers over the last year.
On the liabilities side Noor Trade offers a wide variety of products. The basic ones are the day-to-day transactions. It also offers cash management and investment solutions in addition to foreign exchange services.
The SME segment of the business is comfortable with the current level of non-performing loans (NPLs) “Loss rates in the SME segment of the business is fast evolving. From the very high levels during the economic down turn, it has been moderating over the last two years. Earnings have stabilised for most SMEs while a lot more new entrants are coming in,” said Khakwani.
Despite the recent sharp decline in oil prices Khakwani says the UAE economy looks very robust. “We are keeping an eye out for any risk indicators that might be there, currently we do not foresee any such thing, but we are cautious and we are always on lookout for any triggers that might indicate trouble, but as such we don’t see anything on the horizon,” he said.
Noor Trade uses its own tools to analyse the risk profiles of business it intend to finance. “Businesses are assessed on their financial strength. There are lot of tools and analysis that is done before financing. We visit our client, sit with them and try to understand their business. We do assess our clients upfront and we will look at risk elements that we have learnt from experience,” said Khakwani.